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NY B88657





August 25, 1997

MAR-2 RR:NC:MM:113 B88657

CATEGORY: MARKING

Mr. Andy Leung
Galaxy Freight Service, Ltd.
P.O. Box 30644
JFK Airport Station
Jamaica, NY 11430

RE: Country of origin marking of imported book rings

Dear Mr. Leung:

This is in response to your letter dated August 15, 1997, on behalf of Labelon Noestring, requesting a ruling on the marking of book rings from China. A marked sample was not submitted with your letter for review.

The merchandise is steel book rings. Labelon intends to import the metal book rings for a customer, Lakeview Designs. Lakeview will put 5 rings onto a hanger piece to become a "Round A Belt Organizer." The hanger piece resembles a common wire clothes hanger with a scalloped bottom cross piece in which the rings can rest. The importer is requesting a waiver of marking of the rings, and intends to mark the finished item "Made in USA." The exceptions you cite are 19 CFR 134.32(g) or (h).

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.

The exceptions you rely upon read:

The articles described or meeting the specified conditions set forth below are excepted from marking requirements . . .

(g) Articles to be processed in the United States by the importer or for his account otherwise than for the purpose of concealing the origin of such articles and in such manner that any mark contemplated by this part would necessarily be obliterated, destroyed, or permanently concealed;

(h) Articles for which the ultimate purchaser must necessarily know, or in the case of a good of a NAFTA country, must reasonably know, the country of origin by reason of the circumstances of their importation or by reason of the character of the articles even though they are not marked to indicate their origin.

19 ? 134.32(g) is inapplicable, since the importer is selling the rings to another party, not processing them himself. The reference to 19 ?134.32(h) raises first the question of who is the ultimate purchaser of the rings. In HQ 731432 (June 6, 1988), Customs set forth some factors to be considered in determining whether imported goods combined in the U.S. with domestic products were substantially transformed for country of origin marking purposes. The following six factors were considered:

1) whether the article is completely finished;

2) the extent of the manufacturing process of combining the imported article with the domestic article as compared with the manufacturing of the imported article;

3) whether the article is permanently attached to its counterparts

4) the overall importance of the article to the finished product;

5) whether the article is functionally necessary to the operation of the finished article or whether it is an accessory which retains its independent function; and

6) whether the article remains visible after the combining.

These factors are not exclusive and there may be other factors relevant to a particular case and no one factor is determinative. Applying these factors to this case, we note that the book rings are a class or kind of merchandise which normally is considered a part of something else, usually a looseleaf binder, even though in this case they will be used in a belt organizer. The assembly operation of attaching five rings to the completed organizer neither is complex nor requires a great deal of skill. You have not provided any information as to the condition of this merchandise at the time of purchase. You have not described how it will be packaged, except to say that it will be in a box. The "assembly" of the rings consists merely of opening them up and closing them around the wire hanger. (We have some doubt that even this much assembly will take place, since the retail purchaser would have to open them to use them anyway). Thus they are assembled, if at all, in a nonpermanent manner. The rings are necessary to the function of the completed article. The rings remain visible after the assembly.

Assessing the factors noted above, we find that the rings do not lose their separate identity when they are combined with the hanger to form the completed article. Assembly of the rings with the hangers in no way changes the characteristic of the rings, and the rings are clearly recognizable both before and after the assembly. After examining all the factors we find that the imported rings are not substantially transformed when combined with the hangers and neither your company nor Lakeview may be considered the ultimate purchaser of the imported rings under 19 CFR 134.35.

Section 134.1(d), Customs Regulations (19 CFR 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. The definition then gives examples of who might be the ultimate purchaser if the imported article is used in manufacture, if the imported article is sold at retail in its imported form and if an imported article is distributed as a gift. If an article is to be sold at retail in its imported form, the purchaser at retail is the ultimate purchaser. Since the rings are not substantially transformed, they are not considered to undergo a change in their imported form. Therefore, the retail purchaser is the ultimate purchaser and the rings must be individually marked with their country of origin. Because the rings are combined with domestic hangers before delivery to the ultimate purchaser, the rings should be marked in a manner which clearly shows that the origin indicated is that of the rings alone (e.g., "Rings Made in China"). See 19 CFR 134.14.

Your request did not include any information on the ultimate packing of the finished article, which would allow us to judge whether the marking of the retail container would be sufficient. Since the rings will be repackaged with the hanger to form a belt organizer after importation into the U.S., they are subject to the requirements of section 134.34, Customs Regulations (19 CFR 134.34), which provides that an exception from marking may be authorized in the discretion of the port director under 19 CFR 134.32(d) for imported articles which are to be repacked after release from Customs custody under the following conditions: (1) The containers in which the articles are repacked will indicate the origin of the article to an ultimate purchaser in the U.S.; (2) The importer arranges for supervision of the marking of the containers. Therefore, approval for marking the retail package instead of the individual rings must be obtained from the port director at the port of entry.

In addition, because the rings will be repacked in the U.S. prior to sale to the ultimate purchaser the certification requirements of 19 CFR 134.26 apply.

(a) Certification requirements. If an article subject to these requirements is intended to be repacked in retail containers (e.g., blister packs) 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.

As we have pointed out, you have not indicated that there will be any marking other than "Made in USA" on the retail container. First, approval of markings of "Made in the U.S.A." is within the jurisdiction of the Federal Trade Commission and not the Customs Service. In order to get approval for marking the rings "Made in the U.S.A.," you should contact the Federal Trade Commission, Division of Enforcement, 6th & Pennsylvania Avenue, N.W., Washington, D.C. 20508.

Second, Section 134.46, Customs Regulations (19 CFR 134.46), requires that in any case in which the words "United States," or "American," the letters "U.S.A.," any variation of such words or letters, or the name of any city or locality in the United States, or the name of any foreign country or locality other than 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.

In order to satisfy the close proximity requirement, the country of origin marking must generally appear on the same side(s) or surface(s) in which the name or locality other than the actual country of origin appears.

Based on the circumstances you outlined, the rings must be individually marked with the country of origin as described in order to satisfy the requirements of the regulations.

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

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist James Smyth at 212-466-2084.

Sincerely,

Robert B. Swierupski
Chief, Metals and Machinery Branch

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