HQ 0735474 - Country of origin marking for watches assembled in one country using movements manufactured in a second country; use of the phrase "assembled in"; HQ 735251; HQ 718311 - United States International Trade Commision Rulings

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HQ 735474
February 15, 1994
MAR-2-05 CO:R:C:V 735474 RSD

CATEGORY: MARKING

Timothy C. Stanceu, Esq.
Hogan & Hartson
555 13th, N.W.
Washington, D.C. 20004

RE: Country of origin marking for watches assembled in one country using movements manufactured in a second country; use of the phrase "assembled in"; HQ 735251; HQ 718311

Dear Mr. Stanceu:

This is in response to letter submitted by Timex Corporation (Timex) requesting a ruling on the country of origin marking requirements for imported watches assembled in one country using a movement manufactured in a second country. You have informed us that this ruling should be addressed to your office rather than directly to Timex.

FACTS:

Timex intends to import watches that are assembled ("encased") in one country using watch movements that are manufactured in another country. Timex proposes to mark such watches with the notation "Movement (English Name of country)" in close proximity to the notation "Assembled in (English name of the country in which the watch is assembled)". For example, a watch assembled in Hong Kong from a movement manufactured in the Philippines would be marked as follows:

Movement Philippines
Assembled in Hong Kong

Although no sample was submitted, Timex represents that the marking would be legibly and conspicuously placed on the case back of the watches, and the two country names will be in close proximity to each other. The watches will be imported through the port of New York and possibly other ports.

ISSUE:

Is the proposed marking of a watch indicating the country where the watch movement is manufactured and a second country where the watch is assembled acceptable?

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, and permanently as the nature of the article (or container) will permit, in such 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 of 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.

It has been the position of the U.S. Customs Service for many years that the country of origin of a watch or clock is the country of manufacture of the watch or clock movement. The addition of the hands, dial, case, or watchband add definition to the time piece but do not change the character or use of the watch or clock movement which is the "guts" of the watch or clock. Accordingly, in order to satisfy the requirements of 19 U.S.C 1304, a watch must be legibly marked with the name of the country of manufacture of the watch movement in a conspicuous place.

In a ruling issued to Timex, HQ 718311 (January 26, 1982), Customs held that the proposed marking, "Assembled in Taiwan" "Movement Japan" marked in close proximity on the case back of a watch would satisfy the requirements of section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304).

In HQ 735251 (October 7, 1993), Customs ruled that the phrase "Assembled in" was not sufficient to designate the country of origin of an article under 19 U.S.C. 1304. We also held that marking on watch "Swiss Movement Parts Assembled in China" was not acceptable because it did not properly indicate the country of manufacture of the watch movement.

These two rulings concerned different issues. HQ 735251 dealt with the question of whether the phrase "Assembled in", without any additional marking, before a country name would be sufficient to indicate the country of origin of a watch. It did not hold that phrase "assembled in" could never appear on a watch which was otherwise properly marked with its country of origin. Furthermore, it did not revoke or modify HQ 718311 and thus HQ 718311 is still in effect.

In this case, the country of origin of the watch is properly indicated by the marking "Movement Philippines". The phrase "assembled in Hong Kong" provides consumers with additional information regarding where the watch was assembled or encased and it is not false or misleading. 19 U.S.C. 1304 does not prohibit additional information, such as where certain processing is done or the name of the country where some parts are made, from being put on the article, provided that the article is properly marked with its country of origin and the information is not false or misleading.

However, if reference is made to another country or locality other than the actual country of origin, the requirements of 19 CFR 134.46 must be met. 19 CFR 134.46 provides that in any case in which the words "U.S." or "American," the letters "U.S.A.," any variation of such words or letters, or the name of any city or locality in the U.S., or the name of any foreign country or locality other than the country or locality in which the article was manufactured or produced, appear on an imported article or its container, there shall appear, legibly and permanently, in close proximity to such words, letters or name, and in at least a comparable size, the name of the country of origin preceded by "Made in," "Product of" or other words of similar meaning. In HQ 735251, Customs indicated that in the case of watches, the word "Movement" or an abbreviation for it would be the equivalent of "Made in".

HOLDING:

The proposed marking "Movement Philippines" "Assembled in Hong Kong" for imported watches is acceptable provided that the requirements of 19 CFR 134.46 are satisfied.

Sincerely,

John Durant, Director

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