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HQ 559892





October 4, 1996

MAR-2-05 RR:TC:SM 559892 MLR

CATEGORY: MARKING

Mr. Howard Meyer
PBB Group
P.O. Box 950
434 Delaware Avenue
Buffalo, NY 14202

RE: Country of origin marking for costume jewelry; returned to U.S. distributor; damaged; overstocked; jewelry boxes; 19 CFR 134.26

Dear Mr. Meyer:

This is in reference to your letter of June 3, 1996, requesting a ruling on behalf of TMS Marketing, concerning the country of origin marking requirements for certain costume jewelry. Samples were submitted with your request.

FACTS:

The article at issue is costume jewelry stated to be made in the Far East. The jewelry will be returned from TMS Marketing in Canada to its one U.S. distributor, as it is stated that the jewelry is either damaged or is overstocked merchandise which is not suitable for resale without further conditioning. In a telephone conversation with a member of my staff, you indicated that the imported jewelry will either be destroyed, shipped abroad to the country where the jewelry was manufactured (in this case Korea), or possibly repacked and resold in the U.S.

Each of the pieces of jewelry is stated to be indelibly marked with the country of origin. The samples submitted, a ring, bracelet, pin, and earrings, are stamped with "Korea." The jewelry is also individually boxed and many of the boxes are bubble-sealed. The boxes submitted are either constructed of a black hard-shell plastic or of a hard-shell plastic covered by a gray velvet type material. Both types of boxes open and close with the aid of a hinge, and the top inside section of both boxes is covered with a smooth satin material, while the bottom inside section contains a cardboard insert covered by either black or gray velvet type material.

ISSUE:

What are the country of origin marking requirements of the costume jewelry and jewelry boxes at issue?

LAW AND ANALYSIS:

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.

The first question that must be resolved is who is the ultimate purchaser of the imported jewelry pieces. For the pieces destroyed or returned to the manufacturer abroad, the U.S. distributor will be the ultimate purchaser. Therefore, it will be sufficient, pursuant to 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d), if the outside container in which the jewelry pieces are packed is marked to reasonably indicate to the U.S. distributor the origin of such pieces. For those pieces which will eventually be sold at the retail level, the retail customers will be the ultimate purchasers and the jewelry pieces will need to be marked in accordance with 19 U.S.C. 1304 and 19 CFR Part 134.

The second question to be resolved is whether the imported jewelry pieces which eventually will be resold to retail customers are marked in accordance with the requirements of the marking statute. In Headquarters Ruling Letter (HRL) 734481 dated August 19, 1992, Customs ruled that certain jewelry engraved with the origin of the jewelry near the clasp did not satisfy the requirements of 19 U.S.C. 1304 and 19 CFR Part 134. The importer was instructed to mark the chains by some other method which was easy to read, such as hang tags. In reaching this conclusion, Customs looked to C.S.D. 79-47 (August 7, 1978) and C.S.D. 79-379 (April 9, 1979), where Customs required corrective marking (string tags) on gold jewelry because the existing indelible marking failed to meet the standard of legibility and/or conspicuousness. The result in all three of these decisions would have been different had the indelible markings been sufficiently legible and conspicuous. See HRL 735225 dated August 17, 1993 (tag marking was not required because the quality of the indelible marking on the clasp resulted in well-defined lettering that could be read without difficulty). In that case, the origin markings measured approximately 1/16" by 1/8".

In this case, while the origin markings on the submitted samples are approximately the same as those approved in HRL 735225, the print quality on each sample is not legible. Furthermore, the location of the marking on each sample, except for the ring, is not conspicuous. Therefore, we find that for all pieces, the indelible marking on the jewelry by itself is not sufficiently legible and that a hang tag, such as the one described above, or an adhesive sticker placed on the cardboard insert inside the jewelry box will be needed to correct the marking. We note that if the print size on the ring can be increased, the ring would not need to be marked with an adhesive sticker or hang tag.

We note that the submitted bracelet is also packaged in a plastic bag marked with "Made in Korea" inside the jewelry box. However, in HRL 735218 dated January 11, 1994, Customs ruled that silver pendants imported in plastic bags marked with the country of origin of the pendants were not legally marked because it was likely that the pendants would be removed from the bags prior to retail sale. Rather, it was determined that string tags or adhesive stickers would be acceptable methods of marking the pendants. Similarly, although the bracelets are imported in plastic bags indicating their country of origin, we find that the bracelets would need to be marked with a hang tag in accordance with HRL 735218, especially since it is likely that they will be removed from the plastic bag in order to examine their condition and determine whether they are eligible for retail sale.

In order to ensure that the pieces intended for sale at retail will be marked to inform the retail customer of the jewelry's country of origin, the procedures of 19 CFR 134.26 shall be followed. This section provides in pertinent part that:

If an imported article subject to these requirements is intended to be repacked in retail containers ... after its release from Customs custody, or if the port director having custody of the article, has reason to believe such article will be repacked after its release, the importer shall certify to the port director that: (1) If the importer does the repacking, he shall not obscure or conceal the country of origin marking appearing on the article, or else the new container shall be marked to indicate the country of origin of the article in accordance with the requirements of this part; or (2) if the article is intended to be sold or transferred to a subsequent purchaser or repacker, the importer shall notify such purchaser or transferee, in writing, at the time of sale or transfer, that any repacking of the article must conform to these requirements. The importer, or his authorized agent, shall sign the following statement.

A copy of 19 CFR 134.26 is enclosed. Accordingly, this procedure shall be used since the U.S. distributor will be repacking the jewelry pieces. The requirements of the marking statute and 19 CFR 134.26 will be satisfied if the outside container in which the jewelry is imported is properly marked with the jewelry's country of origin; if TMS Marketing notifies the U.S. distributor that the jewelry pieces intended for sale at the retail level need to be marked; and the U.S. distributor marks each jewelry piece intended for retail sale with a hang tag or adhesive sticker indicating the country of origin of the jewelry piece.

We also note that the jewelry boxes are subject to marking requirements. In Bausch & Lomb Incorporated v. United States, 17 CIT 790 (August 5, 1993), the United States Court of International Trade considered the question of whether imported sunglasses cases were disposable containers for purposes of the country of origin marking requirements. The outer layer of the cases consisted of pebble grain expanded vinyl with a hard plastic insert and a metal snap closure which secures the sunglasses in the case. The court pointed to the durability and protective quality of the sunglasses cases and noted that they were not similar to cans, bottles, paper or polyethylene bags, or paperboard boxes which 19 CFR 134.24 lists as examples of disposable containers not required to be individually marked with their own country of origin. The court found that the plaintiff failed to establish that the sunglass cases were ordinarily discarded by the consumer after any particular amount of usage or after any particular event and determined that they were not disposable containers exempt from the marking requirements under 19 CFR 134.24(c)(1). Relying on Bausch & Lomb, in HRL 734691 dated January 7, 1994, Customs found that jewelry boxes similar to the type in this case were separate articles of commerce that had to be individually marked with their own country of origin. Additionally, pursuant to 19 CFR 134.14, words or symbols were required on the jewelry box to show that the origin indicated was that of the jewelry box and not of the other articles with which it may be sold or combined.

Therefore, in this case, similarly upon importation, the individual jewelry boxes may be excepted from individual country of origin marking indicating their own country of origin, pursuant to 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d), if the marking of the container in which the individual jewelry boxes (along with the jewelry pieces) are packed will reasonably indicate to the U.S. distributor the origin of the jewelry boxes (and jewelry pieces) contained therein. However, as with the jewelry pieces, for those jewelry boxes which will eventually be sold with the jewelry pieces at the retail level, the retail customers will be the ultimate purchasers and the jewelry boxes will need to be marked with their own country of origin, along with the country of origin marking of the jewelry piece. Similarly, as with the jewelry pieces, the requirements of 19 CFR 134.26 apply and will be satisfied if the container in which the jewelry boxes are packed is properly marked with the origin of the boxes, and if TMS Marketing notifies the U.S. distributor that the jewelry boxes, intended for retail sale, need to be labeled with a marking such as "Box Made in (country of origin)" with an adhesive sticker.

HOLDING:

Based on the facts and samples submitted, the jewelry pieces and jewelry boxes may be excepted from marking pursuant to 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d) and only the outer container in which the jewelry boxes and jewelry pieces are packed must be marked with the country of origin of both the jewelry boxes and jewelry pieces. Furthermore, the jewelry pieces and jewelry boxes intended for retail sale may be repacked and manipulated after their release from Customs custody if the requirements of 19 CFR 134.26 are satisfied. The requirements of the marking statute and 19 CFR 134.26 will be satisfied if the outside container in which the jewelry is imported is properly marked with the jewelry's country of origin; if TMS Marketing notifies the U.S. distributor that the jewelry pieces intended for sale at the retail level need to be marked; and the U.S. distributor marks each jewelry piece intended for retail sale with a hang tag or adhesive sticker indicating the country of origin of the jewelry piece. Additionally, each jewelry box must be marked with its own country of origin and the requirements of 19 CFR 134.14 must be satisfied by using a marking such as "Box Made in (country of origin)."

A copy of this ruling letter should be attached to the entry documents filed at the time the goods are 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
Tariff Classification Appeals

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