MAR-02 RR:TC:SM 559627 MLR
Sidney H. Kuflik, Esq.
Lamb & Lerch
233 Broadway, 51st Floor
New York, NY 10279
RE: Country of Origin Marking; Down Comforters; Chinese
Shell; Section 334 Uruguay Round Agreements Act; 19 CFR
134.46
Dear Mr. Kuflik:
This is in reference to your letter dated January 2,
1996, requesting a ruling on behalf of American Down &
Textile Company ("AD&T"), concerning the country of origin
marking of down comforters. A meeting was held at the
Office of Regulations and Rulings on May 9, 1996.
FACTS:
AD&T plans to import Chinese-origin down proof cotton
shells, classifiable under subheading 6307.90, Harmonized
Tariff Schedule of the United States (HTSUS), on and after
July 1, 1996. It is stated that the special tightly woven
cotton shell which contains the down feathers is not
available in the U.S. In the U.S., AD&T will fill the shell
with down which has been fully processed in the U.S. The
filled comforter shell is then closed and quilted to
complete the down comforter. It is stated that the only
imported component is the shell.
AD&T proposes to mark the finished down comforters
classifiable under subheading 9404.90, HTSUS: "Made in the
U.S. of U.S. Components and Chinese Shell," "Made in the
U.S. of U.S. and Imported Components," or "Comforter Filled,
Sewn and Finished in the U.S. With Shell Made in China."
ISSUE:
Whether the finished down comforters may be marked "Made
in the U.S. of U.S. Components and Chinese Shell," "Made in
the U.S. of U.S. and Imported Components,"
or "Comforter Filled, Sewn and Finished in the U.S. With
Shell Made in China."
LAW AND ANALYSIS:
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 imported in 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. 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. Inc., 27 CCPA 297, 302, C.A.D. 104
(1940). Part 134, Customs Regulations (19 CFR Part 134),
implements country of origin marking requirements and
exceptions of 19 U.S.C. 1304.
You contend that section 334 is intended to apply to
goods imported into the U.S., but that for goods which
undergo post-importation processing in the U.S., the
statutorily applicable Customs and Federal Trade Commission
(FTC) marking requirements apply, including the Customs
country of origin marking exceptions provided for under 19
U.S.C. 1304. Therefore, you allege that the imported shells
are entitled to an exception from marking based upon their
"substantial transformation" into down comforters by their
ultimate purchaser, AD&T. Furthermore, you claim that the
identification of the imported origin of the shell is in
compliance with applicable FTC requirements, such that the
markings "Made in the U.S. of U.S. Components and Chinese
Shell," or "Made in the U.S. of U.S. and Imported
Components" are acceptable. As support, you cite New York
Ruling Letter (NYRL) 899334 dated July 22, 1994, where
imported shells were deemed to be substantially transformed
when they were converted into down comforters in the U.S.
Accordingly, you claim that the imported shells are eligible
for a marking exception under 19 U.S.C. 1304(h), which is
applicable when:
an ultimate purchaser, by reason of the character of
such article or by reason of the circumstances of its
importation, must necessarily know the country of origin
of such article even though it is not marked to indicate
its origin.
In this case, you claim that it is not an expressed or
impled rationale underlying the enactment of section 334
that the country of origin marking standards of 19 U.S.C.
1304 be imposed on imports that are substantially
transformed in the U.S. You urge that once the country of
origin is established for the shells that are imported into
the U.S., the marking exemption under 19 U.S.C. 1304 will
apply.
As cited above, the marking statute specifically states
that "every article of foreign origin (or its container)
imported into the U.S. ... shall be marked ... in such a
manner as to indicate to the ultimate purchaser in the U.S.
... the country of origin of the article." (Emphasis
added). In this case, the article imported into the U.S. is
the shell, and it is of foreign origin. In order to
determine whether the imported shell, after it has been used
to make a down comforter, remains an article of foreign
origin for purposes of the marking requirements under 19
U.S.C. 1304, Customs must apply the statutory rules of
origin set forth in section 334 of the Uruguay Round
Agreements Act (codified at 19 U.S.C. 3592), which are
applicable for the determination of the country of origin of
all textile and apparel products to be entered, or withdrawn
from warehouse, for consumption, on and after July 1, 1996.
Thus, Customs regulations set forth in paragraph (c)(1)
through (5) of section 102.21, which implement section 334
also will be used to determine the country of origin for
marking purposes. See 60 FR 46188 (September 5, 1995).
In Headquarters Ruling Letter (HRL) 559625 dated January
19, 1996, the marking of down comforters produced in the
U.S. from imported Chinese origin comforter shells was
considered. Without reiterating the law and rationale
applied in HRL 559625, it was held that since section 334
applies "for purposes of the customs laws" and 19 U.S.C.
1304 is a Customs law, section 334 must be applied for
purposes of determining the country of origin marking
requirements under 19 U.S.C. 1304 for the down comforters
finished in the U.S. The rule set forth in 19 CFR 102.21
for subheading 9404.90 was applied, which states that:
the country of origin of a good classifiable under
subheading 9404.90 is the country, territory, or insular
possession in which the fabric comprising the good was
formed by a fabric-making process.
Accordingly, the country of origin of the finished down
comforters was China based upon the Chinese-origin fabric
used to make the shell in China. As such, we also find that
the imported shells in this case remain of Chinese origin
when combined with down feathers and sewn in the U.S., and,
therefore, may not be marked "Made in the U.S. of U.S.
Components and Chinese Shell" or "Made in the U.S. of U.S.
and Imported Components," as these markings would not comply
with 19 CFR 134.46.
Section 134.46, Customs Regulations (19 CFR 134.46),
requires the name of the country of origin to appear
legibly, permanently, in close proximity, and in at least
comparable size, preceded by the additional words "Made in,"
"Product of," or other words of similar meaning to the name,
when any city or locality in the U.S. or the name of any
foreign country or locality which is not the country of
origin appears on the imported article or its container.
The purpose of this section is to prevent the possibility of
misleading or deceiving the ultimate purchaser.
Accordingly, since the shell's country of origin remains
China, for purposes of 19 U.S.C. 1304, the article which
reaches the ultimate purchaser must indicate that the shell
is from China. If AD&T wishes to make reference on the
shell to a locality which is not its country of origin, the
name "China" must be preceded by "Made in," "Product of," or
words of similar meaning pursuant to 19 CFR 134.46.
However, to the extent that AD&T wishes to use any added
references on the finished comforters, which include a "Made
in USA" claim, this is a matter within the jurisdiction of
the FTC.
In regard to the marking "Comforter Filled, Sewn and
Finished in the U.S. With Shell Made in China," we find that
the requirements of 19 CFR 134.46 are satisfied. Since, the
country of origin of the shell will be preceded by "Made
in," and the marking will indicate to the ultimate purchaser
that the article imported into the U.S. is of foreign
origin, we find that the marking "Comforter Filled, Sewn and
Finished in the U.S. With Shell Made in China" on the
finished down comforter will be acceptable. Furthermore, we
note that unlike the marking, "Comforter Assembled in U.S.
From Fabric Made in China," which was rejected in HRL
559625, in this case, specific reference is made to the
imported article, the shell, as required by 19 U.S.C. 1304.
Additionally, upon importation, it will be sufficient to
only mark "China" on the container in which the shells are
imported, provided the certification requirements of 19 CFR
134.26 are satisfied. Section 134.26, Customs Regulations
(19 CFR 134.26), as amended by T.D. 95-78, provides in
pertinent part that:
If an imported article subject to these requirements is
intended to be repackaged 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 that 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 . . . .
HOLDING:
Based upon the information submitted and pursuant to 19
U.S.C. 3592(b)(2)(A) and 19 CFR 102.21(c)(2), we find that
the country of origin of the imported shell remains China
after the additional operations performed in the U.S. When
combined with other articles to make the down comforters,
the shells may be marked, "Comforter Filled, Sewn and
Finished in the U.S. With Shell Made in China." However,
upon importation, it will be sufficient only to mark "China"
on the container in which the shells are imported, provided
the requirements of 19 CFR 134.26 are satisfied. The
markings "Made in the U.S. of U.S. Components and Chinese
Shell" and "Made in the U.S. of U.S. and Imported
Components" are not acceptable for Customs purposes as they
do not satisfy the requirements of 19 CFR 134.46.
Due to the changeable nature of the statistical
annotation (the ninth and tenth digits of the
classification) and the restraint (quota/visa) categories,
you should contact your local Customs office prior to
importation of this merchandise to determine the current
status of any import restraints or requirements.
The holding set forth above applies only to the specific
factual situation and merchandise identified in the ruling
request. This position is clearly set forth in section
177.9(b)(1), Customs Regulations {19 CFR 177.9(b)(1)}. This
section states that a ruling letter is issued on the
assumption that all of the information furnished in the
ruling letter, either directly, by reference, or by
implication, is accurate and complete in every material
respect. Should it be subsequently determined that the
information furnished is not complete and does not comply
with 19 CFR 177.9(b)(1), the ruling will be subject to
modification or revocation. In the event there is a change
in the facts previously furnished, this may affect the
determination of country of origin. Accordingly, it is
recommended that a new ruling request be submitted in
accordance with section 177.2, Customs Regulations (19 CFR
177.2).
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 officer
handling the transaction.
Sincerely,
John Durant, Director
Tariff Classification Appeals
Division