HQ 560254 - Country of Origin Marking Requirements of Clocks and Crystal Boxes; Special Marking requirements; Chapter 91; Additional U.S. Note 4; 19 CFR 134.41(b); 19 CFR 134.43(b); 19 CFR 11.9; HRL 735158; 19 CFR 134.1(d)(4); HRL 734063; NYRL 892943; HRL 735158; HRL 735197; Ultimate Purchaser; 19 CFR 134.1(d) - United States International Trade Commision Rulings

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HQ 560254

June 17, 1997

MAR-05 RR:TC:SM 560254 DEC

CATEGORY: MARKING

David M. Hall
Expeditors International of Washington, Incorporated 1615 Cross Beam Drive
Charlotte, North Carolina 28217

RE: Country of Origin Marking Requirements of Clocks and Crystal Boxes; Special Marking requirements; Chapter 91; Additional U.S. Note 4; 19 CFR 134.41(b); 19 CFR 134.43(b); 19 CFR 11.9; HRL 735158; 19 CFR 134.1(d)(4); HRL 734063; NYRL 892943; HRL 735158; HRL 735197; Ultimate Purchaser; 19 CFR 134.1(d)

Dear Mr. Hall

This is in reference to your letter of January 7, 1997, requesting a ruling on behalf of The Tharpe Company (Tharpe), concerning the country of origin marking requirements for clocks and crystal boxes. You did not submit any samples for our examination with your ruling request.

FACTS:

Tharpe is engaged in the selling of executive giftwear for service awards based on tenure. The articles that are the subject of this ruling request are clocks and crystal boxes which are purchased domestically, but are of foreign origin. At the time of importation, all the articles will be properly marked with the country of origin. Tharpe will sell the articles to large companies who distribute the articles to their employees as awards. Tharpe etches, engraves, and applies other personalization techniques to fit the intended purpose of the award.

You state that the Tharpe Company's largest customer has requested that the various awards it purchases be free from labels and stickers to preserve the dignity of the award. Tharpe's customer is fully aware that some of the articles purchased will not be of domestic origin. Tharpe intends to mark the origin of the clocks at issue on the movement, but would not mark the clock cases. Instead, Tharpe requests permission to mark the instruction cards or battery installation instructions which are included with the item with the country of origin. The origin of the crystal boxes would also be indicated on a card included with the gift.

ISSUE:

Whether the marking on the clocks and crystal boxes as described above complies with the country of origin marking requirements.

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)), provides that the ultimate purchaser in the U.S. must be able to find the marking easily and read it without strain.

It is the position of the Customs Service 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, the clock must be marked with the name of the country of manufacture of the clock movement. The country of origin marking must also be legible and in a conspicuous place.

With respect to the country of origin marking requirements of the clocks, section 134.43(b), Customs Regulations (19 CFR 134.43(b)), in conjunction with section 11.9, Customs Regulations (19 CFR 11.9), provides that clocks must be marked in accordance with the special requirements of Chapter 91, Additional U.S. Note 4 of the Harmonized Tariff Schedule of the United States (HTSUS) (19 U.S.C. 1202). This note (hereinafter "Note 4") requires that any clock movement or case provided for Chapter 91, HTSUS, whether imported separately or attached to any article provided for in Chapter 91, shall not be permitted to be entered unless conspicuously and indelibly marked by cutting, die-sinking, engraving, or stamping or mold-marking (either indented or raised), as specified in the provisions of the Note. This marking is mandatory. You state that the marking on the clock movement is not obscured in any way. Section (b) of Note 4 requires that clock movements shall be marked on the most visible part of the front or back plate to show the name of the country of manufacture; the name of the manufacturer or purchaser; and, in words, the number of jewels, if any, serving a mechanical purpose as frictional bearings.

Section (d) of Note 4 requires that clock cases provided for in Chapter 91, HTSUS, shall be marked on the most visible part of the outside of the back to show the name of the country of manufacture. The country of manufacture for these requirements refers to where the movement and cases were manufactured, rather than where the clock was made.

In Headquarters Ruling Letter (HRL) 735158, dated December 17, 1993, we addressed the issue of whether a marking of a clock case that was die-sunk on the inside of the back of the case with the name of the manufacturer and the country of manufacture was proper. The case back was covered by a metal cap which was then inserted into a circular slot in a polystone country cottage frame. An adhesive sticker indicating "Made in China" was attached to the green felt bottom of the clock case. Customs determined that the marking of the country of manufacture on the polystone frame through the use of an adhesive sticker on the green felt bottom was unacceptable because the marking was not on the most visible part of the outside of the back.

In the instant case, you state that the marking on the movement is not obscured in any way. However, since you did not submit a sample, it is impossible to verify whether the marking on the movement of the subject clocks is in compliance with the Note 4 requirements. However, the Note 4 marking requirement of the clock cases will not be satisfied with your proposed marking of the country of origin on a card to be included with the gift containing care or battery installation instructions. This marking does not comply with the special marking requirements of Note 4 since it does not appear on the most visible part of the outside of the back to show the name of the country of manufacture nor is the clock case indelibly marked using one of the prescribed methods.

In HRL 735158, Customs held that the country of origin marking at issue was unacceptable because the marking was not placed in the most visible part of the outside of the back of the clock case pursuant to the special marking requirements contained in Note 4. New York Ruling Letter (NYRL) 892943, dated December 14, 1993, only addressed the marking requirements of 19 U.S.C. 1304 and indicated in general terms that for purposes of the marking statute, an adhesive sticker was sufficient provided it was affixed securely enough that unless it was deliberately removed it will remain on the article until it is delivered to the ultimate purchaser. NYRL 892943 was issued in response to the importer's inquiry regarding the use of "CZ" as an abbreviation of the Czech Republic to indicate that the clock was produced in the Czech Republic. It is obvious that the ruling letter was not intended to address the special marking requirements of clocks since there was no reference to Note 4. The ruling letter merely sets forth the general country of origin marking requirements of 19 U.S.C. 1304. Customs has previously held that a marking may satisfy the general 19 U.S.C. 1304 requirements, but may not be acceptable for purposes of the special marking requirements of Note 4. See HRL 735197, dated January 4, 1994

Pursuant to 19 CFR 134.1(d)(4), if the imported crystal boxes at issue are distributed as a gift, the recipient will be deemed the ultimate purchaser unless the good is a good of a NAFTA country, in which case the ultimate purchaser will be the last person who actually purchases the good. In HRL 734063, dated May 21, 1991, we held that when imported merchandise is distributed as a gift, the recipient of the gift will be the ultimate purchaser. In that case, we found that the unsealed boxes in which the article was distributed was not required to be marked to indicate the country of origin of the contents since the gift box may be opened by the recipient at the time the gift is received whereupon the country of origin will be revealed. Similarly, Customs does not object to the country of origin marking of the crystal boxes at issue appearing on the card which provides instructions to the recipient, provided it meets the general requirements of conspicuousness, legibility, and permanence. If the crystal boxes are a NAFTA good, only the outermost container that reaches the company who purchases the crystal boxes will be required to be marked.

HOLDING:

Based on the information provided, we are of the opinion that the clock cases which are required to be marked in accordance with the special marking requirements for clock cases of Additional U.S. Note 4, Chapter 91, HTSUS, are not marked properly. The marking of the crystal boxes on the instruction card will be acceptable provided the general marking requirements of 19 U.S.C. 1304 as indicated above are satisfied.

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
Tariff Classification Appeals

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