HQ 562817 - Country of origin marking for license plates: good of a NAFTA country; ultimate purchaser - United States International Trade Commision Rulings

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HQ 562817

September 17, 2003

CLA-2 RR:CR:SM 562817 KSG

CATEGORY: MARKING

Mr. Brian Kavanaugh
Deringer Logisitics Consulting Group
1 Lincoln Blvd.
Suite 225
Rouses Point, NY 12979

RE: Country of origin marking for license plates: good of a NAFTA country; ultimate purchaser

Dear Mr. Kavanaugh:

This is in response to your submission of July 28, 2003, on behalf of Waldale Manufacturing Ltd, requesting a binding ruling regarding the appropriate country of origin marking of automobile license plates.

FACTS:

Waldale Manufacturing Ltd., is the Canadian manufacturer of automobile license plates. These license plates are purchased by various states in the U.S. for use in registering motor vehicles in those states. The license plates are not individually marked with their country of origin. The license plates are shipped in cartons that are marked to indicate that the goods are a product of Canada. Each state retains ownership of the license plate; the citizen is given the plate to place on his or her automobile as evidence of the registration of the automobile, which is required by state law.

ISSUE:

What are the country of origin marking requirements applicable to the imported license plates described above?

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 United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or 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. 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 on 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, 302 (1940). Part 134 of the Customs Regulations implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.

An "ultimate purchaser" for a good of a NAFTA country is defined in 19 CFR 134.1(d) as the last person in the United States who purchases the good in the form in which it is imported. If the imported article is distributed as a gift and the good is a good of a NAFTA country, the purchaser of the gift (rather than the recipient) is the ultimate purchaser.

Pursuant to 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d), an exception from individual marking is applicable where the marking of a container of such article will reasonably indicate the origin of the article. This exception is normally applied in cases where the article is imported in a properly marked container and Customs officials at the port of entry are satisfied that the ultimate purchaser will receive it in the original unopened marked container. Relevant factors regarding whether an article is likely to remain in its original container include the chain of distribution, the type of container, and the nature of the article.

In this case, the license plates are made in Canada and therefore, are a good of a NAFTA country. The vehicle owners pay money to the state because they are required to register the automobile and they receive the license plates essentially as a receipt to prove their registration. The vehicle owner is not purchasing the license plates; the state retains ownership of the license plates. This is analogous to a scenario dealt with in Headquarters Ruling Letter ("HRL") 561318, dated April 26, 1999, which concerned small bottles of Canadian-origin shampoo that were distributed free of charge to hotel guests. Customs ruled in that case that the hotel was the ultimate purchaser of the imported shampoo. Similarly, in HRL 558018, dated November 15, 1994, Customs ruled that when Mexican-origin videos were distributed free of charge to customers by U.S. companies, the U.S. company was the ultimate purchaser of the imported videos. In both HRL 561318 and 558018, Customs allowed marking of the container alone pursuant to 19 CFR 134.32(d).

Based on the above analysis, we find that the states are the ultimate purchasers of the imported license plates. Further, we find that pursuant to 19 CFR 134.32(d), marking the containers in which the license plates are shipped to the state satisfy the country of origin marking requirements. Accordingly, provided the outermost container is marked with the article's origin, the license plates themselves will be excepted from country of origin marking.

HOLDING:

Based on the information provided, the states are the ultimate purchaser of the imported license plates and pursuant to 19 CFR 134.32(d), marking the container in which the license plates are shipped to the states will satisfy the requirements of 19 U.S.C. 1304.

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,

Myles B. Harmon
Director, Commercial Rulings Division

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