HQ 0733267 - Country of origin marking requirements for rental shop towels - United States International Trade Commision Rulings

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HQ 733267

June 27, 1990

MAR-2-05 CO:R:V:C 733267 RSD

CATEGORY: MARKING

Marcela B. Stras, Esq.
Barnes & Thornburg
1815 H Street, Suite 800
Washington, D.C. 20006

RE: Country of origin marking requirements for rental shop towels

Dear Ms. Stras:

This is in response to your letter dated April 12, 1990, and your subsequent correspondence, in which you seek a ruling on the country of origin marking requirements for imported rental shop towels.

FACTS:

Your client imports shop towels from Bangladesh and Pakistan. The towels are imported in large bales, each containing 2500 towels. The bales in turn are imported in burlap bags that contain four sticks on each side which are bound with metal bands. The country of origin of the towels is stenciled on each of the burlap bags. Inside each bale are bundles of 50 shop towels held together by a string through a hole in each of the towels. The burlap bags are never broken--they are sold to linen supply companies that rent the shop towels to machine shops and other industrial users. At present, each towel is being individually marked with its country of origin by a sewn on cloth label. You request an exception from marking the individual towels because the marking of the containers will indicate the country of origin to the ultimate purchaser. You also indicate that it is costly to sew on a label on each towel. Photographs of the burlap bags with the proposed country of origin marking were submitted.

ISSUE:

Do the shop towels have to be individually marked with their country of origin if the burlap bags are marked with the country of origin?

LAW AND ANALYSIS:

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. "The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will." United States v. Friedlaender & Co., 27 C.C.P.A. 297 at 302 (1940).

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.41(b), Customs Regulations (19 CFR 134.41(b)), mandates that the ultimate purchaser in the U.S. must be able to find the marking easily and read it without strain.

An article is excepted from marking under 19 U.S.C. 1304 (a)(3)(D) and 19 CFR 134.32(d), if the marking of a container of such article will reasonably indicate the origin of such article. Accordingly, if the ultimate purchaser can tell the country of origin of the shop towels by viewing the container, the individual shop towels themselves would be excepted from marking under this provision. Therefore, it is necessary to ascertain who is the ultimate purchasers of the shop towels.

Section 134.1(d), Customs Regulations, (19 CFR 134.1(d)), defines the ultimate purchaser as the generally the last person in the U.S. who will receive the article in the form in which it was imported. Customs has previously considered the question of who is the ultimate purchaser when an importer sells towels to a linen supply company, who in turns rents the towels to its customers. In HQ 708979, May 31, 1978, Customs ruled that the linen supply company which purchases the towels in rolls for rental to its customers is the ultimate purchaser of those imported items. Similarly in this case, we find that the linen supply companies who buy the shop towels and rent them to machine shops and other industrial users are the ultimate purchasers of the shop towels.

You have indicated that the towels are imported in and are sold to the linen supply companies in burlap bags which are marked with the country of origin of the towels and the bales are never broken. Accordingly, if the district director of Customs at the port of entry is satisfied that the imported towels will reach the linen supply companies in bags in which they are imported which are legibly and conspicuously marked to indicate the country of origin of the contents, an exception from individual marking will be applicable.

HOLDING:

The linen supply companies that buy the towels from the importer and rent them to machine shops and other industrial users are the ultimate purchasers. The individual towels are excepted from country of origin marking under 19 U.S.C. 1304 (a)(3)(D) and 19 CFR 134.32(d) if the district director at the port of entry is satisfied that towels are imported in bags which are conspicuously and legibly marked with the country of origin of the towels and that the towels will reach the linen supply companies in these unopened marked bags.

Sincerely,

Marvin M. Amernick

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