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May 17, 1999

MAR-2 RR:NC:1:113 E81481

CATEGORY: MARKING

Ms. Susan L. Renton
Baker & McKenzie
815 Connecticut Avenue, NW
Washington, DC 20006-4078

RE: COUNTRY OF ORIGIN MARKING OF IMPORTED REPLACEMENT CARAFES; ARTICLE 509

Dear Ms. Renton:

This is in response to your letter dated April 23, 1999, on behalf of TDL Group Ltd. requesting a ruling on the country of origin marking requirements for an imported article. A marked sample was not submitted with your letter for review.

The merchandise is a replacement carafe for an electric coffee maker imported from Canada. You request that the item be marked “Made in Germany” on the box in which it is to be sold. The product consists of nine components, a lid, the carafe body, a ring locator, a pot ring, screws, a hook, a handle cap, a handle and a washer. The carafe body is made of glass that has been molded to shape in Germany. The carafe lid, ring locator, hook, handle cap and handle are made of plastic that has been made in China. The pot ring, screws and washer are made of metal and have been manufactured in China.

The German carafe is shipped to China where the plastic and metal components are added to make the finished article. The replacement carafe is then packaged and shipped to Canada, and then subsequently imported into the United States. The sealed, retail box will be marked on one side with the name and address of the Canadian distributor. The same information will be found, in French, on another side of the box. You propose that the marking “Made in Germany” be printed near this reference in the same size print on the English side of the box.

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 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 country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the North American Free Trade Agreement ("NAFTA"), as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat 2057) (December 8, 1993) and the appropriate Customs Regulations. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. The marking requirements of these goods are set forth in Part 134, Customs Regulations.

Section 134.1(b) of the regulations, defines "country of origin" as the country of manufacture, production, or growth of any article of foreign origin entering the U.S. 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 this part; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin. (Emphasis added).

Section 134.1(j) of the regulations, provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) of the regulations, defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules. Section 134.45(a)(2) of the regulations, provides that a "good of a NAFTA country" may be marked with the name of the country of origin in English, French or Spanish.

You state that the imported carafes are imported from a NAFTA country, Canada. In order to determine the country of origin marking requirements, first, we must apply the NAFTA Marking Rules in order to determine whether the imported carafe "is a good of a NAFTA country".

Part 102 of the regulations, sets forth the "NAFTA Marking Rules" for purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 of the regulations, sets forth the required hierarchy for determining country of origin for marking purposes. Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that, for marking purposes, the imported carafe is not a good of Canada.

Since the imported carafes are not goods of a NAFTA country, the general substantial transformation test (change in name, character or use), must be applied in order to determine who is the ultimate purchaser pursuant to 19 CFR 134.35(a) of the regulations. The "country of origin" is defined in 19 CFR 134.1(b) 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 . . “ For tariff purposes, the courts have held that a substantial transformation occurs if a new and different article emerges having a distinctive name, character or use. Anheuser?Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982).

In this case, we find that the imported carafes are not substantially transformed as a result of the Chinese assembly, and therefore the carafe remains a product of Germany. Accordingly, the imported article and/or container must be marked to indicate "Made in Germany" as the country of origin of the imported article in accordance with the marking requirements of 19 U.S.C. 1304 and 19 CFR Part 134.

An article is excepted from marking under 19 U.S.C. 1304 (a)(3)(D) and section 134.32(d), Customs Regulations (19 CFR 134.32(d)), if the marking of a container of such article will reasonably indicate the origin of such article. Accordingly, if Customs is satisfied that the article will remain in its container until it reaches the ultimate purchaser and if the ultimate purchaser can tell the country of origin of the contents by viewing the container in which it is packaged, the individual carafes would be excepted from marking under this provision.

Carafes which are imported in containers that are marked in the manner described above, are excepted from marking under 19 U.S.C. 1304 (a)(3)(D) and 19 CFR 134.32(d). Accordingly, marking the container in which the carafes are imported and sold to the ultimate purchaser in lieu of marking the article itself is an acceptable country of origin marking for the imported carafes provided the port director is satisfied that the article will remain in the marked container until it reaches the ultimate purchaser.

In addition, Section 134.46, Customs Regulations (19 CFR 134.46), deals with cases in which the 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, and those words, letters or names may mislead or deceive the ultimate purchaser as to the actual country of origin. In such a case, 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. The proposed marking, as described above, satisfies the marking requirements of 19 U.S.C. 1304 and 19 CFR Part 134 and is an acceptable country of origin marking for the imported carafes. The information in French on another side will not be considered to deceive the ultimate purchaser as to the country of origin of the items.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR Part 181).

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 212-637-7008.

Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229.

Sincerely,

Robert B. Swierupski
Director

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