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HQ 558944




May 23, 1995

MAR-2-05 R:C:S 558944 DEC

CATEGORY: MARKING

Mr. Earl A. Roberts
R.L. Jones Customhouse Brokers, Incorporated P.O. Box 472
Calexico, California 92231

RE: NAFTA; Article 509; 19 CFR 102.11; 19 CFR 102.18; Country of origin marking for sunglasses and reading glasses; 19 CFR 102.14; 19 CFR 134.43

Dear Mr. Roberts:

This is in response to your letter dated July 23, 1994, on behalf of your client, Greatech Vision, requesting a ruling on the country of origin marking requirements for finished sunglasses and reading glasses.

FACTS:

On behalf of your client, Greatech Vision, you have submitted various samples of sunglass frames, sunglass lenses, reading eyeglass frames, and lenses. Greatech Vision plans to manufacture plastic lens blanks in the United States. The lens blanks will be sent to Mexico to be washed in detergent, dipped in a silicone solution for hard coating, oven dried, cut to shape, and inserted into plastic frames that are manufactured in Mexico. Greatech Vision intends to mark the lenses with a self-stick paper label stating "Precision Optical Lenses Made in U.S.A." or "Lenses Made in U.S.A.", with the words "Assembled in Mexico" directly below. The sample reading glass and sunglass frames have the word "Mexico" screen printed on one of the temples of the frames.

ISSUE:

What are the proper country of origin marking requirements for the finished sunglasses and reading glasses that are produced as described above?

LAW AND ANALYSIS:

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. origin imported into the United States 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 United States the English name of the country of origin of the article. The Customs Regulations implement the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Part 134 of the Customs Regulations implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.41(b), mandates that the ultimate purchaser in the United States must be able to find the marking easily and read it without strain.

Part 102 of the interim regulations (Customs Regulations (19 CFR Part 102)), sets forth the NAFTA Marking Rules for purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 of the interim regulations sets forth the required hierarchy for determining country of origin for marking purposes. Section 102.11(a) of the interim regulations states that

[t]he country of origin of a good is the country in which:

(1) The good is wholly obtained or produced; (2) The good is produced exclusively from domestic materials; or
(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section 102.20 and satisfies any other applicable requirements of that section, and all other requirements of these rules are satisfied.

"Foreign Material" is defined in section 102.1(e) of the interim regulations as "a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced."

Section 102.11(a)(1) and section 102.11(a)(2) do not apply to the facts presented in this case because neither the sunglasses or reading glasses are wholly obtained or produced in Mexico nor are they produced exclusively from domestic (Mexican) materials. In fact, the glasses are produced from materials from the United States and Mexico. Since an analysis of sections 102.11(a)(1) and 102.11(a)(2) will
not yield a country of origin determination, we look to section 102.11(a)(3). Section 102.11(a)(3) provides that the country of origin is the country in which "[e]ach foreign material incorporated in that good undergoes an applicable change in tariff classification in ? 102.20. . .." When imported into Mexico, the plastic lenses used to produce the sunglasses and the reading glasses are classified under subheading 9001.50.00, Harmonized Tariff Schedule of the United States (HTSUS). The finished sunglasses and reading glasses are classified under heading 9004, HTSUS. The applicable tariff shift rule found in section 102.20(r) provides as follows:

HTSUS Tariff Shift and/or other requirements 9004........... A change to heading 9004 from any other heading, except from subheading 9001.40 or 9001.50.

Thus, the U.S.-produced lenses that are transported to Mexico to be processed into finished glasses do not undergo an applicable tariff shift. The rule set forth above specifically precludes a tariff shift where lenses are processed into finished glasses. Since the foreign material that is to be incorporated into the finished article does not undergo a tariff shift, a country of origin determination cannot be made under section 102.11(a)(3).

Since no country of origin determination could be made applying section 102.11(a), the analysis continues with section 102.11(b) which instructs us to examine the article's essential character to determine its country of origin. Section 102.11(b) provides that where the country of origin cannot be determined under section 102.11(a), and the good is not specifically designated as a set pursuant to the Harmonized System nor classified as a set under General Rule of Interpretation 3, the country of origin of the article is "the country or countries of origin of the single material that imparts the essential character of the good. . .."

In determining the "essential character" of the finished glasses, section 102.18(b)(2) of the interim regulations provides as follows:

For purposes of applying ?102.11, only domestic and foreign materials (including self-produced materials) that are classified in a tariff provision from which a change in tariff classification is not allowed in the rule for the good set out in ? 102.20 shall be taken into consideration in determining the essential character of the good.

In this case, the materials that do not undergo the applicable tariff shift are the lenses. Therefore, the U.S.-origin lenses are the components that impart the essential character unto both the finished sunglasses and reading glasses. The country of origin of these items at this point in the analysis is the United States.

Section 102.14, however, states that

No good, last advanced in value or improved in condition outside the United States has United States origin. If under any other provision of this part such a good is determined to be a good of the United States, that determination will be disregarded and the country of origin of the good will be the last foreign country in which the good was advanced in value or improved in condition.

Consequently, the U.S.-origin determination is disregarded and the country of origin of both the sunglasses and the reading glasses is Mexico since the glasses were last advanced in value or improved in condition in Mexico.

Section 134.43(e) states that

Articles returned to the U.S. after having been advanced in value or improved in condition outside the United States. Where the country of origin of an article is determined in accordance with
?102.14, part 102 of this Chapter, such article, at the choice of the importer, exporter or producer of the good, may be marked, as appropriate, in a manner such as the following:

(1) Assembled in (name of foreign country) from U.S. components;

(2) Further processed in (name of country of origin) from U.S. materials;

(3) Product of (name of foreign country) made from U.S. components; or

(4) Product of (name of foreign country).

Since the origin determination was reached pursuant to section 102.14, the articles may be marked "Product of Mexico made from U.S. lenses" or "Product of Mexico."

HOLDING:

The finished sunglasses and reading glasses are a product of Mexico pursuant to the NAFTA Marking Rules. Accordingly, the country of origin marking is required to indicate Mexico as the country of origin of the finished glasses.

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.

Sincerely,

John Durant, Director

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