MAR-2-05 CO:R:C:V 554957 KG
Daniel McClary
16303 Larch Way North
Lynwood, Washington 98037
RE: Country of origin marking of imported ophthalmic sutures
Dear Mr. McClary:
This is in response to your letter of December 7,1987,
requesting a country of origin ruling regarding imported
ophthalmic sutures. You have already received a ruling letter
dated March 8, 1988 (NY 827131), addressing the item 807, Tariff
Schedules of the United States issue. We regret the delay in
responding to your inquiry.
FACTS:
The imported article consists of two curved needles attached
on either end to a 12" piece of black monofilament nylon thread
mounted on a shaped piece of styrofoam. You submitted two
samples for examination.
The stainless steel wire from which the needle is made is a
product of the U.S. The wire is sent to West Germany in spools
where it is cut to length, curved, flattened and the tip is cut
and sharpened to a 6-point tip in West Germany. The nylon thread
is made and dyed in the U.S. and sent to West Germany in spools
where it is cut to length and attached to the needles. The
completed suture is then mounted on styrofoam in West Germany.
The styrofoam will be of either U.S. or West German origin.
The mounted sutures are then shipped to the U.S. in bulk
where they are sterilized and repackaged. Each suture is
individually packaged in a sealed sterile packaging. A dozen
sutures in individual packages are then inserted into an unsealed
paper sleeved tray. You state that the sutures are sold only in
lots of a dozen in a sleeved tray. You propose to mark the
sleeve tray with the phrase "Needles made in W. Germany-Sutures
made in U.S.A." below the U.S. address and phone number of the
company selling the product.
ISSUE:
Whether marking the imported ophthalmic sutures, as
described above, satisfies section 304 of the Tariff Act of 1930,
as amended.
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, 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 U.S. the English name
of the country of origin of the article. The Court of
International Trade stated in Koru North America v. United
States, 701 F.Supp. 229, 12 CIT (CIT 1988), that: "In
ascertaining what constitutes the country of origin under the
marking statute, a court must look at the sense in which the term
is used in the statute, giving reference to the purpose of the
particular legislation involved. The purpose of the marking
statute is outlined in United States v. Friedlaender & Co., 27
CCPA 297 at 302, C.A.D. 104 (1940), where the court stated that:
"Congress intended 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."
Part 134, Customs Regulations (19 CFR Part 134), implements
the country of origin marking requirements and exceptions of 19
U.S.C. 1304. Section 134.1(b), Customs Regulations (19 CFR
134.1(b)), states that the country of origin means 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 the meaning of Part 134.
A substantial transformation occurs when articles lose their
identity and become new articles having a new name, character or
use. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 at 270
(1940), National Juice Products Association v. United States, 10
CIT 48, 628 F.Supp. 978 (CIT 1986), Koru North America v. United
States, 12 CIT ___, 701 F.Supp. 229 (CIT 1988). In The
Torrington Company v. United States, 764 F.2d 1563 (Fed. Cir.
1985), a case arising under the generalized system of preference
statute, the court found that sewing machine needles made in a
beneficiary developing country ("BDC") from wire manufactured in
a non-BDC were substantially transformed in the BDC. Customs
ruled in HQ 730999 (December 12, 1988), that imported surgical
needles attached to thread in the U.S. and thereby made into
sutures suitable for use in cardiovascular surgery were
substantially transformed in the U.S. Customs stated in that
ruling that "the surgical needles alone, prior to processing,
have no apparent use; it is only after the addition of surgical
thread that the article becomes known as a suture and is suitable
for use in surgery to bind body tissue." In this case, the
spools of wire and thread are made into an ophthalmic suture, a
new article having a new name, character or use in West Germany.
In accordance with HQ 730999 and consistent with Torrington, the
West German processing is considered a substantial
transformation. Therefore, the country of origin of the
imported article for marking purposes is West Germany.
The term "ultimate purchaser is defined in section 134.1(d),
Customs Regulations (19 CFR 134.1(d)), as generally the last
person in the U.S. who will receive the article in the form in
which it was imported. If the article is to be sold at retail in
its imported form, the purchaser at retail is the ultimate
purchaser. In this case, medical offices and hospitals would
purchase the finished imported articles. Therefore, the ultimate
purchaser would be the hospital or medical office which ordered
and paid for the imported ophthalmic sutures.
Pursuant to 19 U.S.C. 1304(a)(3)(D) and section 134.32(d),
Customs Regulations (19 CFR 134.32(d)), imported articles for
which the marking of the containers will reasonably indicate the
origin of the articles are not required to be individually
marked. The exception set forth in 19 U.S.C. 1304(a)(3)(D) and
19 CFR 134.32(d) applies 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 its unopened marked container.
Because the imported article in this case will be packaged
in the U.S. after importation, section 134.34, Customs
Regulations (19 CFR 134.34), would apply. This section states
that an exception may be authorized under section 134.32(d) in
the discretion of the district director 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 articles to
an ultimate purchaser in the U.S. (2) The importer arranges for
supervision of the marking of the containers by Customs officers
at the importer's expense or secures such verification, as may be
necessary, by certification and the submission of a sample or
otherwise, of the marking prior to the liquidation of the entry.
The individual packages, which contain one suture each, are
sealed sterile containers. Clearly, it would be acceptable to
mark the country of origin on each individual container.
However, you propose to only mark the country of origin on the
unsealed paper sleeves. If the district director is satisfied
that the ophthalmic sutures are only sold in bulk and packaged in
these sleeves and that the ophthalmic sutures only reach the
medical offices in these sleeves, then the imported article and
the individual packaging may be excepted from marking, in the
discretion of the district director, in accordance with 19 CFR
134.34.
The container must be marked to indicate that the country of
origin of the ophthalmic sutures is West Germany. The package
may also indicate the country of origin of the various
components, but the phrase "sutures made in U.S.A." would be
considered misleading. The word "sutures" refers to the
completed product and could mislead the ultimate purchaser as to
its country of origin.
We also note that section 134.46, Customs Regulations (19
CFR 134.46), would apply to any U.S. addresses appearing on the
packaging. Section 134.46, Customs Regulations (19 CFR 134.46),
requires that when the name of any city or locality in the U.S.,
other than the name of 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. The purpose of this section is to prevent the
possibility of misleading or deceiving the ultimate purchaser as
to the actual origin of the imported article. If, as proposed,
the only U.S. address appearing on the packaging is just above
the country of origin marking and in comparable size, the marking
would satisfy the requirements of 19 CFR 134.46.
HOLDING:
The spools of wire and thread are substantially transformed
in West Germany into ophthalmic sutures. If the district
director is satisfied that the ophthalmic sutures are only sold
in bulk and packaged in these sleeves and that the ophthalmic
sutures only reach the medical offices in these sleeves, then the
imported article and the individual packaging may be excepted
from marking, in the discretion of the district director, in
accordance with 19 CFR 134.34.
Sincerely,
Marvin M. Amernick
Chief, Value, Special Programs
and Admissibility Branch