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NY 806457




February 24, 1995

CLA-2-44:S:N:N8:230 806457

CATEGORY: CLASSIFICATION

TARIFF NO.: 4414.00.0000; 4420.10.0000

Mr. Thomas D. Church
Margaret Furlong Designs
210 State Street
Salem, OR 97301

RE: The tariff classification of wooden picture frames and miniature chairs from China; further processing in the United States; country of origin marking; substantial transformation; finishing; assembly.

Dear Mr. Church:

In your letter dated January 27, 1995, you requested a tariff classification ruling. Samples were submitted and will be retained for reference.

The first item to be imported is an unfinished, unassembled picture frame which will be completed by your firm, here in the U.S., prior to resale. As imported, it will consist of a sheet of wood fiberboard which has been cut to the size and shape of a frame, and which has been "milled to create the various cavities and recesses." It will also be pre-sanded and "undercoated." Included in the same shipment will be additional components intended to be assembled with the main fiberboard piece, after importation: cut glass, frame inserts and frame backs.

After receiving the import shipment, your firm will apply gold, copper or silver leaf, and a sealing varnish, to the frames, and will also produce and attach some hand-made porcelain ornaments (also surface-decorated with metal leaf). Then the glass, inserts and backs will be added to complete the articles.

The applicable subheading for the unfinished, unassembled picture frames (including glass, inserts and backs) will be 4414.00.0000, Harmonized Tariff Schedule of the United States (HTS), which provides for wooden frames for paintings, photographs, mirrors or similar objects. The rate of duty will be 5.6%.

You also requested a ruling on whether the imported frames are required to be individually marked with their country of origin, in view of the subsequent processing performed in the U.S. by your firm. You believe that "since the material and labor content of the work done domestically is considerably more costly than the raw items imported," the product will be substantially transformed in the United States, so that "Made in China" marking would be "inaccurate and unnecessary."

The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) 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.

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. Section 134.1(d), defines the ultimate purchaser as generally the last person in the U.S. who will receive the article in the form in which it was imported. 19 CFR 134.1(d)(1) states that if an imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported article to a process which results in a substantial transformation of the article. 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 and that the manufacturer or processor will be considered the ultimate purchaser of the constituent materials. In such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked. See, 19 CFR 134.35.

In this case, however, we find that the imported frames are not substantially transformed as a result of the U.S. processing, and therefore the U.S. manufacturer is not the ultimate purchaser. Customs has consis- tently held that because the types of processing involved here (applica- tions of decorative coatings/coverings, attachment of embellishments, and simple assembly operations) leave the imported merchandise essentially intact, they do not effect a substantial transformation.

Accordingly, since the retail buyer of the finished frames will be considered the ultimate purchaser, the imported article and/or the container which reaches said purchaser will be required to be marked "Made in China."

The second item to be imported is identified as a "miniature three-dimensional chair," the sample of which measures about 3 1/2" x 3 1/2" x 9" (H). It is said to be made of laser-cut wood fiberboard panels which have been glued and nailed together, then sanded and painted. (Unlike the picture frame, this item will be imported in a finished condition.) You indicate that consumers will use the chairs "for dolls, teddy bears and also for the display of collectible items."

In view of the use of these goods, you request that they be classified as toys rather than as articles of wood. We find, however, that although the miniature chairs could conceivably be used for dolls, such use is purely secondary in nature to their principal use as ornamental articles unto themselves. Chapter 95, HTS, covers toys "designed for amusement purposes." It is clear that the design of these chairs provides an aesthetic appeal which, as you indicate, may be used to display collectible items. This office finds no conclusive evidence to indicate that these chairs are designed principally for amusement purposes, and therefore cannot consider classification as toys.

Accordingly, the applicable subheading for the "miniature chairs" will be 4420.10.0000, HTS, which provides for statuettes and other ornaments, of wood. The rate of duty will be 4.7%.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177).

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,

Jean F. Maguire

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