HQ 559261 - Country of Origin Marking; Paperboard Sleeves; Kitchen Knives; Kitchen Forks; - United States International Trade Commision Rulings

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HQ 559261

February 13, 1996

MAR-05 RR:TC:SM 559261 KKV

CATEGORY: MARKING

Ms. Laura Deniz
Import Manager
Evans & Wood & Co.
P.O. Box 610005
Dallas/Fort Worth Airport, TX 75261

RE: Country of Origin Marking; Paperboard Sleeves; Kitchen Knives; Kitchen Forks;
19 CFR 134.46

Dear Ms. Deniz:

This is in response to your letter dated June 9, 1995, on behalf of B & F System, Inc., which requests a ruling concerning the country of origin marking requirements for marking appearing on paperboard sleeves for kitchen knives and kitchen forks. A sample of the paperboard sleeve intended for use with the kitchen knife has been submitted. No sample of either the knife or fork has been submitted.

FACTS:

You state that your client wishes to import kitchen knives and kitchen forks into the United States which are contained in paperboard sleeves. Your state that the polypropylene handle of both the knives and forks is molded in Japan with a slot in which the fork or blade may be inserted. The steel for the blade or fork is manufactured in Japan and is shipped to China in finished sheets of stainless steel which has been processed to the necessary thickness.

In China, the individual blades and forks are stamped out of the steel sheets and the DIAMOND CUT logo and the country of origin (China) are stamped into each piece. A sharp edge is ground onto the knife blades, and the finished blade is inserted into the handle. The forks undergo the same process, except that the edges are not ground, as with the knives, but rounded before insertion into the handle. Your client proposes to mark the paperboard sleeves in the following manner.

The front side of the paperboard sleeve containing the kitchen knife will state "Diamond Cut" and "French Chef Knife." The back side of this paperboard sleeve will contain the following warranty information:

LIMITED LIFETIME WARRANTY - This knife is guaranteed for the life of the original purchaser. Send with $1.00 for S/H to CSC, P.O. Box 224442, Dallas TX 75222. This warranty gives you specific legal rights and you may have other rights varying from state to state. We aren't responsible for incidental/consequential damage. Some states do not allow exclusions so this exclusion may not apply.

The bottom of the back side of the sleeve will read "Handle Mfg. In Japan. Steel Mfg. In Japan, Knife Mfg. In China, Diamond Cut USA."

The front side of the paperboard sleeve containing the kitchen fork will state "Diamond Cut" and "Fork." Identical to the sleeve detailed above, the back side of this sleeve will contain warranty information, including a U.S. address (CSC, P.O. Box 224442, Dallas TX 75222). The bottom of the back side of the sleeve will read "Handle Mfg. In Japan. Steel Mfg. In Japan, Knife Mfg. In China, Diamond Cut USA."

ISSUE:

Does the marking which appears on a paperboard sleeve for a kitchen knife and kitchen fork satisfy the country of origin marking requirements of 19 U.S.C. 1304 and 19 CFR Part 134?

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 United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or 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. 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, 302 (1940). 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.

"Country of origin" is defined in section 134.1(b), Customs Regulations, as
the country of manufacture, production, or growth of any article of foreign origin entering the United States. 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 this part.

A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, or use which differs from the original material subjected to the process. Texas Instruments, Inc. v. United States, 631 F.2d 778, 782 (CCPA 1982). In determining whether the assembly of parts or materials constitutes a substantial transformation, the issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article. See, Uniroyal Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (CIT 1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983). Assembly operations which are minimal or simple, as opposed to complex or meaningful, will generally not result in a substantial transformation. See, C.S.D. 80-111, C.S.D.85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D.89-129 and C.S.D.90-97.

In this case, steel sheets from Japan are sent to China, where the knives and forks are stamped out to individual shapes. The DIAMOND CUT logo and country of origin are stamped into each piece. A sharp edge is ground onto the knife blades before insertion into the Japanese handle. The edges of the kitchen forks are rounded before insertion into the Japanese handle. Upon review, Customs finds that the above operations performed in China substantially transforms the Japanese materials into a new and different article having a new name, character and use. The Japanese steel sheets which have multiple uses are dedicated to a specific use when stamped out into the shapes of knife blades and forks, with the blades being further assembled into the finished knives. In addition the handles do not provide the essence of either the finished knives or forks when assembled into these articles and thus, lose their identities and become integral parts of a new and different article. Therefore, the knives and forks are of Chinese origin and must be marked accordingly.

Part 134, Customs regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. One of the exceptions to the general marking requirement is codified in 19 U.S.C. 1304(a)(3)(D) (as implemented by 19 CFR 134.32(d)), which provides that an article may be excepted from marking if the marking of its container will reasonably indicated its origin to the ultimate purchaser.

Section 134.46, Customs Regulations (19 CFR 134.46), contains more restrictive marking requirements designed to alleviate the possibility of misleading an ultimate purchaser with regard to the country of origin of an imported article. Specifically, 19 CFR 134.46 requires that, in instances where the name of any city or locality in the U.S., or the name of any foreign country or locality other than the name of the country or locality in which the article was manufactured or produced, appears 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. Customs has ruled that in order to satisfy the close proximity requirement, the country of origin marking must appear on the same side(s) or surface(s) in which the name of the locality other than the country of origin appears (See HQ 708994, dated April 24, 1978).

In this case, the paperboard sleeve designed for the kitchen knife is marked with a non-origin geographical reference on each side. On the front side is printed the phrase, "French Chef Knife" and the other side is printed with a U.S. address. With regard to the front side, inasmuch as the knife is a product of China, the prominent reference to France, which is not the country of origin, is potentially misleading, thus triggering the applicability of 19 CFR 134.46. Therefore, the reference to France may remain on the sleeve only if the country of origin of the knife is clearly indicated and the requirements of section 134.46 are met. To effectively meet these requirements, the country of origin, China, must be preceded by "Made in," "Product of" or other words of similar meaning. Further, in light of the proximity requirement, the origin marking must appear on the same side of the paperboard sleeve as the non-origin geographical reference to France and must be printed in at least a comparable size to the phrase "French Chef Knife."

The reverse side of the paperboard sleeve for the kitchen knife is printed with a paragraph explaining warranty information, including a U.S. address (CSC, P.O. Box 224442, Dallas TX 75222). The bottom of the back side of the sleeve is also marked, "Handle Mfg. In Japan. Steel Mfg. In Japan, Knife Mfg. In China, Diamond Cut USA."

In HRL 559245, dated December 13, 1995, Customs considered proposed country of origin marking for cutlery and an accompanying wood block. Customs held that a reference to a non-origin locality geographical reference which is clearly designated as a customer service point of contact which is marked on the retail container of the cutlery and block is not potentially confusing and does not trigger the more stringent marking requirements of 19 CFR 134.46.

Here, the U.S. address is directly preceded with the initials "CSC," which appears to be an abbreviated reference to"Customer Service Center." Ideally, while we would prefer a less abbreviated customer service designation, we find that this function may be inferred from the context in which it appears. Moreover, the U.S. address immediately precedes country of origin information for the product (Handle Mfg. In Japan. Steel Mfg. In Japan, Knife Mfg. In China, Diamond Cut USA."). Upon review, we find that the combination of the customer service reference together with the non-origin geographical reference in such close proximity to the detailed country of origin information is sufficient to alleviate the possibility that a potential purchaser will be misled with regard to the actual country of origin and therefore, the special marking requirements of 19 CFR 134.46 are not triggered.

Notwithstanding the above determination regarding the applicability of section 134.46, we find that the proposed origin marking for the reverse side will not satisfy the general requirements of permanency, legibility and conspicuousness under 19 U.S.C. 1304 and 19 CFR Part 134 unless the country of origin information for the article, "Knife Mfg. In China" is used alone or, in the alternative, is set forth first, if used in combination with component origin information. We find that the statement "Diamond Cut USA" to be misleading and not appropriate in any circumstances. Once the article has been correctly marked with the country of origin, there is no additional marking requirement for indicating the origin of component parts, thus these references "Handle Mfg. In Japan, Steel Mfg, In Japan," may be deleted from the retail container.

We are informed that the front side of the paperboard sleeve designed for use with the kitchen fork will be marked "Fork," with no geographical reference of any type, while the reverse side will be marked with language identical to that used with regard to the reverse side of the paperboard sleeve designed for the kitchen knife, as previously detailed above. In accordance with the analysis set forth above, in light of the combination of the customer service reference together with the non-origin locality reference in such close proximity to the detailed country of origin information, it is our determination that an ultimate purchaser will not be misled with regard to the actual country of origin of the imported kitchen fork. Having thus concluded that the non-origin locality reference would not mislead or deceive an ultimate purchaser as to the country of origin of the imported article, we find that, with regard to the reverse side of the paperboard sleeve designed for use with the kitchen fork, the special marking requirements of 19 CFR 134.46 are not triggered. However, as with the kitchen knife, it is our determination that the proposed marking for the reverse side will not satisfy the general requirements of permanency, legibility and conspicuousness under 19 U.S.C. 1304 and 19 CFR Part 134 unless the country of origin information for the article, "Fork Mfg. In China" either is used alone or, is set forth first in the order of presentation, if used in combination with component origin information. As is the case with the kitchen knife, the statement "Diamond Cut USA" is misleading and must be deleted.

HOLDING:

Based upon the information provided, we find that both the kitchen knife and fork are products of China. With regard to the paperboard sleeve designed for the knife, the phrase "French Chef Knife" may remain on the front side of the paperboard sleeve only if the country of origin of the knife is clearly indicated and the requirements are 19 CFR 134.46 are met. The country of origin, China, must be preceded by "Made in," "Product of" or other words of similar meaning. Further, the origin marking must appear on the same side of the paperboard sleeve as the non-origin geographical reference to France and must be printed in at least a comparable size type. The proposed origin marking for the reverse side of the paperboard sleeve for both the knife and fork will not satisfy the general requirements of permanency, legibility and conspicuousness under 19 U.S.C. 1304 and 19 CFR Part 134 unless the country of origin information for the article, "Knife Mfg. In China,""Fork Mfg. In China," is used alone or, in the alternative, is set forth first, if used in combination with other origin information. Neither of these articles may bear the marking "Diamond Cut USA."

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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