HQ 0734390 - Country of Origin Marking - Construction and Industrial Scaffolding; Rentals; 134.32(f); Ultimate Purchaser. - United States International Trade Commision Rulings

United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org Rulings By Number Rulings By Category Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1992 HQ Rulings > HQ 0734281 - HQ 0734440 > HQ 0734390

HQ 734390

March 20, 1992

MAR-2-05 CO:R:C:V 734390 NL

CATEGORY: MARKING

Mr. Gary R. Wilmarth
Day, Berry & Howard
CityPlace
Hartford, CT 06103-0100

RE: Country of Origin Marking - Construction and Industrial Scaffolding; Rentals; 134.32(f); Ultimate Purchaser.

Dear Mr. Wilmarth:

This is in response to your letter dated October 30, 1991, concerning a waiver of country of origin marking requirements on behalf of your client, Aluma Systems Corp. (Aluma) and its related companies, Umacs of Canada, Inc., Aluma Systems, Inc., and the Burke Company (the affiliates). As there is no provision for waivers of country of origin marking requirements under the applicable statute and regulations, we are considering your letter as a request for approval of various exceptions from country of origin marking.

FACTS:

The business of Aluma and its affiliates consists of renting or leasing scaffolding, shoring, and forming equipment. Accompanying descriptive literature indicates that the equipment is in the nature of engineered structural systems which consist of numerous interlocking components. The components and systems are manufactured in the U.S. and a number of foreign countries. Equipment is generally exported to the U.S. from Canada by Umacs of Canada as intercompany transfers or sales for the accounts of the U.S. affiliates. The equipment may remain permanently in the U.S. in the affiliates' rental inventories, or may be resold in Canada or elsewhere. Over its useful life a piece of equipment may be moved numerous times between the U.S. and Canada without being sold.

You represent that for purposes of these multiple cross- border movements, the equipment is eligible for exception from country of origin marking pursuant to 19 CFR 134.32(c) as articles which cannot be marked prior to shipment to the U.S. except at an expense economically prohibitive of their importation. In support of this position you state that: 1) the age of the equipment in the rental fleet makes tracing the country of origin of the pieces; 2) A significant portion of the equipment acquired from another company, and the majority of this equipment is over 20 years old and unidentifiable as to its origin; and 3) Weather conditions and cleaning requirements for this equipment causes existing labels and manufacturer identifications to be removed; and 4) the large numbers of pieces (in the hundreds of thousands) makes marking of all pieces "near impossible".

You also request that the exemption provided at 19 CFR 134.32(f) be approved, since the merchandise is leased on short term and remains the property of the Aluma affiliate. That section provides an exception from marking for articles imported for use by the importer and not intended for sale in their imported or any other form.

Finally, you state that in rare instances the equipment is sold either during or at the end of a lease term, and you propose to provide Customs and the purchaser with certain certifications concerning the marking of this equipment.

ISSUE:

Under what circumstances may this equipment be excepted from country of origin marking?

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, permanently, and indelibly 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.

Part 134, Customs Regulations, implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. To the extent that the equipment will not be sold, but is being imported to become part of the stock of Aluma or one of its affiliates available for lease or rental, the equipment will be eligible to be excepted from country of origin marking pursuant to 19 CFR 134.32(f), implementing 19 U.S.C. 1304(a)(3)(F), which excepts from marking requirements "articles imported for use by the importer and not intended for sale in their imported or any other form." Customs generally has taken the approach that a person who receives imported articles for his use in a rental business is considered the ultimate purchaser of the imported articles, and the articles are excepted from marking. See, e.g., HQ 733267 (June 27, 1990)(company which rents shop towels considered ultimate purchaser of imported towels; individual towels excepted from marking, as marking of bags will suffice per 19 CFR 134.32(d).)

Here, the company doing the importing is also the company doing the renting or leasing. Thus the articles are not intended for sale in their imported form, but are for the importer's use as the ultimate purchaser within the meaning of 19 CFR 134.32(f). Accordingly, except as set forth below, the imported equipment may be excepted from country of origin marking pursuant to 19 CFR 134.32(f). Moreover, as provided at 19 U.S.C. 1304(b), the containers of articles excepted under 19 U.S.C. 1304(a)(3)(F) are not required to be marked with the country of origin of their contents.

Because the above-referenced exception from marking is available to Aluma and its affiliate for this equipment, we find it unnecessary to consider your claim of exception pursuant to 19 CFR 134.32(c) that the expense of marking would be economically prohibitive of its importation.

As indicated your submission, in some cases the equipment imported for consignment to Aluma or its affiliates is subsequently sold. It is not possible to determine at the time of importation whether a given item of equipment will later be sold. Under these circumstances Customs will require, as a condition for approval of importations excepted from marking under 19 CFR 134.32(f), that Aluma submit a declaration at importation that if the articles are later sold they will be marked in accordance with the requirements of section 304 of the Tariff Act and Part 134, Customs Regulations.

HOLDING:

The scaffolding equipment and components are imported for the use of Aluma and its affiliates, which are the ultimate purchasers of the equipment. Pursuant to 19 U.S.C. 1304(a)(3)(F), 19 U.S.C. 1304(b), and 19 CFR 134.32(f), the imported equipment and its containers may be excepted from marking. This exception will be approved provided that the importer submits to Customs the declaration described above.

Sincerely,

John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling