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HQ 561839

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March 1, 2001

MAR-2-05 RR:IA 561839 RFC

CATEGORY: MARKING

Debra A. Tremblay
Affiliated USA Inc.
193 West Service Road
Champlain, NY 12919

RE: Exception of Certain Reusable Bedding and Garments from Certain Marking and Labeling Requirements

Dear Ms. Tremblay:

This is in reference to your July 19, 2000, letter relating to a ruling request on behalf of Absorb-Plus Inc., 5750 Royalmount, Suite 201, Mont-Royal, Quebec, Canada H4P 1K5, concerning whether prospective imported reusable bedding and garments said to be exclusively sold to and used by medical facilities may be excepted from certain country of origin and labeling requirements.

FACTS:

In your letter, you state that the articles under consideration are reusable bibs, resizable diapers, reusable briefs, bed sheets and pillowcases, and reusable underpads, reusable inserts and vinyl laundry. All articles are used only in medical facilities, such as nursing homes and hospitals, for the care of geriatric patients. All articles are manufactured in Canada and shipped to distributors in the United States who then send them to the medical facilities. All articles are always shipped in cardboard boxes which normally contain piece counts of from two dozen to four dozen of each article. The products are specifically manufactured for medical facility use only and are not sold in stores or catalogs, etc. where individuals are able to purchase them.

ISSUE:

Whether imported reusable bedding and garments said to be exclusively sold to and used by medical facilities may be excepted from the country of origin marking requirements under section 304 of the Tariff Act of 1930, as amended and from the marking and labeling requirements of the Textile Fiber Products Identification Act.

LAW AND ANALYSIS:

Country of Origin Marking For Purposes of Section 304 of Tariff Act of 1930

The U.S. law relating to country of origin marking for imported merchandise (“the marking statute”) is found in section 304 of the Tariff Act of 1930, as amended (19 U.S.C. § 1304). This law provides that, unless excepted, every article of foreign origin (or its container) imported into the United States 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 United States the English name of the country of origin of the article. See 19 U.S.C. § 1304(a). Products made in the United States do not have to be marked with their country of origin under this statute.

The purpose of the marking statute is to allow the ultimate purchaser of the goods to know, by simple inspection, specifically where they were made in case such knowledge might influence his or her decision to purchase the goods (i.e., to permit the ultimate purchaser in the United States to choose between domestic and foreign-made products, or between the products of different foreign countries). See generally, United States v. Friedlaender & Co. Inc., 27 C.C.P.A. 297, at 302 (1940).

The “ultimate purchaser” is defined in Part 134 of the Customs Regulations as:

[G]enerally the last person in the United States who will receive the article in the form in which it was imported; however, for a good of a NAFTA country, the ``ultimate purchaser'' is the last person in the United States who purchases the good in the form in which it was imported.

19 CFR § 134.1(d).

The Customs Service has ruled in the past that the ultimate purchaser of certain imported merchandise that is imported for sale to and use by medical facilities is the medical facilities themselves. See generally, HQ 560266 (January 17, 1997). This is based on the principle that it is the medical facility that makes the decision on whether to purchase the articles and not the patients of the facility. The patients are temporarily provided with or loaned the articles after they have been purchased by the medical facilities. Thus, the medical facilities are “the last person in the United States who will receive the article in the form in which it was imported.” Furthermore, in the instant case, as the above-mentioned articles are goods of a NAFTA country (i.e., Canada), the medical facilities are “the last person in the United States who purchases the good in the form in which it was imported.” Accordingly, the ultimate purchaser of reusable bedding and garments (from a NAFTA country) that are specifically manufactured for medical facility use only and sold only to such facilities are the medical facilities themselves.

There exist certain exceptions to the marking requirements in the marking statute. One of those exceptions can be found in section 1304 (a)(3)(D). It deals with those situations where the marking of the container that holds the imported merchandise will reasonably indicate the origin of the merchandise. Under section 1304 (a)(3)(D) to the marking statute, an imported article is not required to be marked with its country of origin if:

The marking of a container of such article will reasonably indicate the origin of such article.

Part 134, Customs Regulations (19 CFR §134) implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304. Subpart D to part 134 implements the exceptions in the marking statute. Section 134.32 (d) to subpart D lists the following exception:

Articles for which the marking of the containers will reasonably indicate the origin of the articles.

19 CFR § 134.32 (d).

The Customs Service has ruled in the past that products that are imported for sale to and use by medical facilities need not be individually marked as to their country of origin but rather could be marked on the packages or on the outside of the containers in which the products were packed provided the medical facility receives the products in such properly marked packages or containers. See generally, HQ 560266 (January 17, 1997). In the instant case, the imported reusable bedding and garments sold exclusively for use by medical facilities may be excepted from the country of origin marking requirements under section 304 of the Tariff Act of 1930 (19 U.S.C. § 1304 (a)(3)(D) and 19 CFR § 134.32 (d)).

Textile Fiber Products Identification Act

In your request, you indicate that the some or all of the articles may be textile fiber products. If any of the articles are textile fiber products that are subject to the requirements of the Textile Fiber Products Identification Act (15 U.S.C. § 70), under the rules and regulations promulgated by the Federal Trade Commission (FTC) under this act, the imported articles are required to be marked, subject to specified exceptions, with their respective fiber contents and other required information, including country of origin. See 16 CFR § 303. Pursuant to section 11.12b, Customs Regulations (19 CFR § 11.12b), the Customs Service is responsible for the enforcement of the marking and labeling requirements of this act at the time of importation of any relevant merchandise. The interpretation of the act, however, is the responsibility of the FTC. Therefore, any questions regarding the interpretation of this act (as well as implementing rules and regulations) and its application to the above-described products should be directed to the FTC which can be reached at the following address and telephone numbers:

Textile Section
Division of Enforcement
Federal Trade Commission
600 Pennsylvania, Avenue, N.W.
Washington, D.C. 20580

Telephone: 202-326-3553 or 326-2996
URL address: www.ftc.gov

HOLDING:

Based on the information submitted, the above-mentioned products may be excepted from the country of origin marking requirements set forth in the marking statute (see 19 U.S.C. § 1304) provided the cardboard boxes in which the products are packed and shipped to the medical facilities are marked with the country of origin of the products.

Questions concerning the interpretation of the Textile Fiber Products Identification Act (15 U.S.C. § 70) should be directed to the FTC.

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 Service officer handling the transaction.

Sincerely,

John A. Durant, Director
Commercial Rulings Division

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