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 > 1993 HQ Rulings > HQ 0734548 - HQ 0734681 > HQ 0734558

Previous Ruling Next Ruling


HQ 734558


July 22, 1992

MAR-2-05 CO:R:C:V 734558 RSD

CATEGORY: MARKING

Ms. Margaret Solinger
E.I. Dupont de Nemours & Co., Inc.
Wilmington, Delaware 19898

RE: Country of origin marking requirements for herbicide in soluble film, substantial transformation, products of U.S. exported and returned; 19 CFR 134.35, 19 CFR 134.32(m)

Dear Ms. Solinger:

This is in reference to your letter of March 24, 1992, concerning the country of origin marking for a herbicide known as accent. On June 16, 1992, Customs issued a ruling, HQ 556616, with respect to the applicability of the duty exemptions under subheadings 9801.00.10 and 9802.00.50, Harmonized Tariff Schedule of the United States (HTSUS). This ruling will address the country of origin marking issue raised in your letter.

FACTS:

E.I. Dupont de Nemours & Co. Inc. is a domestic manufacturer of various agricultural chemical products including the herbicide, "Accent." Accent is a post-emergence herbicide intended for use on field corn. It is a water dispersible granule containing 75% active ingredient by weight. Accent causes moderate eye irritation and is harmful when absorbed through the skin. Users are cautioned to avoid contact with skin, eyes and clothing.

Because of the potential hazards of accidental contact with a user's eyes or skin, you intend to export U.S. made Accent to France for incorporation into a water-soluble film. This film is a highly specialized plastic designed for compatibility with agricultural chemical and applications technology. The incorporation process will enable a grower to drop a pre- measured, sealed, water-soluble packet of Accent into a designated amount of water, where the film will dissolve, and the Accent disperse.

The Accent which you intend to export for the above- described purpose will be manufactured at your El Paso, Illinois facility. The herbicide will be transported in bulk in drums to your subsidiary in France ("Ducotech"). Ducotech has contracted with Nedi, an unrelated French concern in Les Mannes, France to perform the processing. Nedi was chosen because it possesses the technology and equipment necessary to assure product safety, quality and exact dosage application.

In France, Nedi will place the Accent in what is commonly referred to as a "form and fill" machine, which will incorporate the Accent into 3.3 oz. water soluble pouches. Four of the 3.3 oz. water soluble film pouches will be inserted into one barrier pouch. The barrier pouches are composed of aluminum between a layer of polyethylene plastic, which protects the film and its contents from adverse conditions such as humidity. The barrier pouch is then heat-sealed and placed in a carton along with eleven other inner cartons which are packed in a shipping carton. You state that all of the Accent will be returned to the U.S. You further indicate that the process whereby the Accent is incorporated into the pre-measured water soluble film does not change the chemical structure or use of the product. The identities and properties of the herbicide remain intact.

ISSUE:

Does the U.S. made herbicide, Accent, encapsulated in a water soluble film have to be marked with its 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 its 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; C.A.D. 104 (1940).

By definition, only merchandise which is "of foreign origin," i.e., of a country of origin other than that of the U.S., is subject to the requirements of 19 U.S.C. 1304. Stated differently, products of the U.S. are not subject to these requirements. Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and the exceptions of 19 U.S.C. 1304. Section 134.1(b), Customs Regulations (19 CFR 134.1(b)), defines "country of origin" as the country of manufacture, production or growth of any article of foreign origin entering the U.S. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin" within the meaning of the marking laws and regulations. The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that an article used in manufacture which results in an article having a name, character or use differing from that of the constituent article will be considered substantially transformed.

U.S. products exported and returned are specifically excepted from country of origin marking requirements under section 134.32(m), Customs Regulations (19 CFR 134.32(m)). With certain exceptions not applicable here, Customs has ruled that products of the U.S. which are exported for further processing and subsequently returned, are not subject to country of origin marking upon importation to the U.S. unless the further processing in the foreign country constituted a substantial transformation of the product. See HQ 732480, (July 31, 1989).

It is therefore necessary to determine whether the U.S. made Accent was substantially transformed when it was incorporated into the water soluble film in France. In our previous ruling on this product, HQ 556616, June 16, 1992, Customs determined that the imported Accent is eligible for the duty exemption under HTSUS subheading 9802.00.50 for articles returned to the U.S. after having been exported for repairs or alternations. In the ruling, we noted that the application of this tariff provision is precluded in circumstances where the operations performed abroad destroy the identity of the article or create a new or commercially different article. In applying this tariff provision to facts of this case, we stated that the operations performed in France do no have the effect of destroying the identity of the herbicide or changing its chemical composition. We further explained that the foreign operations do not result in any significant change in the character or use of the herbicide, and the overseas process merely facilitates the use of the herbicide and making it safer for the consumer. In other words, the product is not substantially transformed by the processing that will be done in France, and therefore it remains a product of the U.S. when it is imported into the U.S. Accordingly, under 19 CFR 134.32(m) the imported Accent is excepted from the country of origin marking requirements of 19 U.S.C. 1304. HOLDING:

Because the imported herbicide, Accent, is not substantially transformed when it was incorporated in the soluble film, it remains a product of the U.S. and it is excepted under 19 CFR 134.32(m) from the country of origin marking requirements of 19 U.S.C. 1304.

Sincerely,

John Durant, Director

Previous Ruling Next Ruling

See also: