MAR-2-05 CO:R:C:V 732823 NL
John B. Rehm, Esq.
Munford Page Hall, II, Esq.
Dorsey & Whitney
1330 Connecticut Avenue, N.W.,
Washington, D.C. 20036
RE: Country of Origin Marking of Shoe Boxes
Dear Sirs:
This is in response to your submission of October 17, 1989,
in which you request a ruling on behalf of your client that
imported cardboard shoe boxes must be marked separately with
their country of origin when used to package U.S. origin shoes.
FACTS:
Your client is a domestic producer of cardboard shoe boxes.
According to your submission, shoe boxes are imported from Canada
and sold to domestic shoe manufacturers. The boxes are imported
as flats, made up by the shoe manufacturers, and used to package
shoes for retail sale. We assume, and you have not alleged
otherwise, that the shoes in question are of U.S. origin. You
state that the shoe boxes often bear the marking "Made in
U.S.A.", or words to similar effect which refer to the shoe
contents. You state that the boxes also bear the trade names of
the domestic manufacturers. Finally, you state that the
individual shoe boxes have no marking indicating their Canadian
origin.
Samples were submitted both of boxes without country of
origin marking and of boxes marked as you contend is required by
section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), i.e., "Box made in Canada". In addition, you submitted a
survey report entitled "Final Report - Shoebox Usage Study"
(Report). Based upon a telephone survey of 400 respondents the
Report projected that a majority of shoe purchasers (84 % in the
survey group) utilize shoe boxes for a secondary purpose such as
storage of photographs, records, bills, and other personal items
including shoes.
It is your position that for purposes of country of origin
marking the purchaser of boxed shoes is the ultimate purchaser of
the cardboard shoe boxes, which you argue are separate articles
of commerce from their shoe contents. From this you conclude
that the shoe boxes are not subject to the provisions of Part
134, Subpart C, Customs Regulations governing the country of
origin marking of containers, but rather that the boxes when used
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to package shoes must be individually marked with their country
of origin as separate imported articles. In the alternative, it
is your position that if the shoe boxes are subject to the
country of origin marking requirements for containers, they
should be regarded as reusable containers and accordingly marked
individually with their country of origin.
Finally, you contend that the shoe boxes may not be excepted
from country of origin marking if they bear any marking or symbol
which suggests that their origin is the U.S. You urge that 19
CFR 134.36(b) and 19 CFR 134.46 be construed to require that the
name of the country of origin of the boxes appear in close
proximity to the words or symbols which, you argue, suggest that
the shoe boxes originate in the U.S.
ISSUES:
Are imported cardboard shoe boxes used to package U.S.
origin shoes required to be individually marked with their
country of origin? Do the requirements of 19 CFR 134.36(b) and
19 CFR 134.46 apply to such boxes?
LAW & 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
purpose of the marking statute is set forth in United States v.
Friedlaender & Co., 27 CCPA 297, 302, C.A.D. 104 (1940), in which
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 a
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.
The disposition of this ruling request depends upon the
outcome of two related inquiries. First, are the cardboard shoe
boxes disposable containers? Second, who is the ultimate
purchaser of the boxes within the meaning of 19 U.S.C. 1304?
Upon consideration of the arguments and evidence presented,
taking into account the language and purposes of the statute and
regulations, and having reviewed our prior determinations, it is
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our opinion that imported cardboard shoe boxes are disposable
containers. Cardboard shoe boxes imported to be filled by
domestic shoe manufacturers are excepted from individual country
of origin marking pursuant to 19 CFR 134.24(c)(1). That section
provides that persons or firms who import disposable containers
in order to fill them with products they sell are the ultimate
purchasers of the containers. Such containers are excepted from
country of origin marking pursuant to 19 U.S.C. 1304(a)(3)(D),
although at the time of importation their outside wrappings or
packaging must be marked with the containers' country of origin.
Section 134.1(d), Customs Regulations (19 CFR 134.1(d)),
defines "ultimate purchaser" as generally the last person in the
U.S. who will receive the article in the form in which it was
imported. For example, Customs determined in HQ 729239 (January
3, 1986) that the ultimate purchaser of disposable bags is the
company that buys and uses them to package its goods, even if the
company is not the importer. After packaging, the disposable
container becomes an integral part of the article with which it
is packaged, and is no longer a separate article of commerce. As
such, the packager is the last person who receives the disposable
container in the form in which it was imported.
Subpart C of 19 CFR Part 134, which provides for the country
of origin marking of containers, recognizes two broad categories
of containers. Section 134.23 specifies that reusable
containers, which must be individually marked with their country
of origin, are either: 1) those usual and ordinary containers
designed for or capable of reuse after their contents have been
consumed, such as heavy duty steel drums, tanks, and other
similar shipping, storage, or transportation containers; or 2)
containers which give the whole importation its essential
character, having lasting value or decorative use. Section
134.24 provides that disposable containers are the usual and
ordinary types of containers or holders, including cans, bottles,
paper or polyethylene bags, paperboard boxes, and similar
containers or holders which are ordinarily discarded after the
contents have been consumed. Disposable containers which are
packed and sold in multiple units may be marked to indicate their
country of origin on the outermost container which reaches the
ultimate purchaser.
A review of our previous rulings in this area leads to the
conclusion that cardboard shoe boxes fall squarely within the
category of disposable containers. We have previously ruled
that plastic boxes with separate tops and bottoms used to store
U.S.- origin crayons were disposable containers. HQ 729943
(November 13, 1986). Similarly, in HQ 731318 (August 12, 1988)
we ruled that vinyl cases for birth control pills are disposable
containers within the meaning of 19 CFR 134.24. Finally, in HQ
729817 (November 13, 1986), we ruled that cardboard cartons to be
packed in the U.S. with bottles of wine cooler are disposable
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containers.
HQ 729476 (October 10, 1986), which you cited in your
submission, is readily distinguishable. In that ruling we
determined that the ultimate purchaser of a plastic shopping bag
was the retail customer of the store which provided it, since the
bag was durable and capable of reuse. We noted in that ruling
that, unlike the shoe boxes, the plastic bag was not the primary
container for the merchandise sold by the store, and was provided
free of charge for the convenience of the store's customers. We
have consistently ruled that when an article is provided as a
gift or convenience, the donee or recipient is the ultimate
purchaser and the article must be individually marked with its
country of origin. See, 19 CFR 134.1(d)(4); C.S.D. 89-89 (March
18, 1989); HQ 729800 (October 10, 1989). The shoe boxes, by
contrast, are the primary containers for the shoes, and it may
reasonably be assumed that the cost of the boxes is included in
the price of the shoes. The boxes are not provided merely as a
convenience to the shoe purchaser, but are the usual and ordinary
container of the shoes. For the same reason, your reliance upon
HQ 709207 (July 10, 1978) is misplaced, since the plastic bags
addressed there also were given away free of charge.
Also, we do not find your empirical arguments that shoe
boxes are reusable, and qualify as separate articles of commerce
persuasive. In construing the container provisions of subpart C
of 19 CFR Part 134, we are guided by the regulation's terms
"usual", "ordinary", "designed for" and "not designed for".
These terms indicate that we are to take into account the
ordinary purpose and capability for which the container is
created. Absent compelling reasons not shown here, we are
directed by subpart C of 19 CFR Part 134 to treat a cardboard box
as a container. It has not been demonstrated, for example, that
there is a market for shoe boxes beyond shoe manufacturers. It
has not been demonstrated that a shoe purchaser would refuse to
buy a pair of shoes on the basis that the box in which it is sold
is of foreign origin. Finally, the Report submitted addresses
entirely the secondary uses of shoe boxes, and cannot overcome
the plain fact that the normal and primary purpose of shoe boxes
is to contain shoes. We find the fact that a shoe box may be
reused for other purposes fortuitous, and have not been presented
with evidence of the kind which would indicate that a shoe box is
an article sought out by ultimate purchasers in its own right.
We find that the cardboard shoe boxes are containers subject to
the country of origin marking requirements for containers set
forth in 19 CFR Part 134, subpart C.
We note that General Rule of Interpretation (GRI) 5(b) of
the Harmonized Tariff Schedule of the United States (HTSUS)
provides that packing materials and packing containers entered
with the goods therein shall be classified with the goods if they
are of a kind normally used for packing the goods. This
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provision does not apply when the packing materials or containers
are "clearly suitable for repetitive use". We take this rule in
this case as further indication that for Customs purposes a shoe
box which is normally used to package shoes is not, when it
reaches the ultimate purchaser of the shoes, an article of
commerce separate from its contents.
As is evident from the foregoing discussion, we are also
not persuaded that shoe boxes are reusable containers. It has
not been demonstrated that, in the words of GRI 5(b), HTSUS, the
shoe boxes are "clearly suitable for repetitive use." Among the
examples of disposable containers set forth in 19 CFR 134.24 are
"paperboard boxes and similar containers". Our previous rulings
cited above, that plastic containers, pill boxes and cardboard
cartons for wine coolers are disposable containers excepted from
individual country of origin marking, are consistent with this
approach.
Your final contention is that 19 CFR 134.36(b) and 19 CFR
134.46 require that the country of origin of the shoe box appear
in close proximity to any words or symbols which indicate a
country other than the country of origin of the shoe box. The
purpose of these provisions is to prevent any misleading or
possible deception of ultimate purchasers as to the country of
origin of imported articles.
Section 134.36(b) provides that an exception from marking
shall not apply to any article or retail container bearing any
words, letters, names, or symbols described in section 134.46
which imply that an article was made or produced in a country
other than the country of origin. Facially, the sample boxes
which you contend are improperly marked present this issue. The
box for Bass shoes bears the address of the shoe manufacturer
and the words "Made in U.S.A.". The box for Sebago shoes bears
no marking other than the word "Sebago" which, arguably, is also
the kind of geographic name described in section 134.46.
However, upon consideration of our prior rulings on this point
and examination of the sample boxes, it is our opinion that the
markings on the boxes imply that the shoes to be placed in the
boxes and not the boxes themselves were made in the U.S.
Therefore, an exception from individual country of origin marking
for these shoe boxes is not precluded by section 134.36(b).
In ruling 731388 (June 11, 1988), we considered whether
potato bags from Canada imported to pack U.S.- grown potatoes
were required to be individually marked with their country of
origin. The bags were marked with the U.S. address of the bag
manufacturer as well as the U.S. address of the potato producer.
We determined that the presence of the U.S. address of the maker
of the Canadian-origin bags tended to imply that the bags were of
U.S. origin, and that pursuant to section 134.36(b) the bags
could not be excepted from individual country of origin marking.
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We stated that had the address of the produce company only
appeared on the bags these words would have implied only that the
potatoes were of U.S. origin. Similarly here, where the names
and addresses of the U.S. shoe manufacturers are the only
markings on the shoe boxes, there can be no reasonable inference
that the addresses suggest the origin of the box; they plainly
refer to the shoe manufacturer. In HQ 729817 supra, we ruled
that there was no inconsistency between a U.S. marking on an
imported disposable container for a wine cooler and the U.S.
origin of the wine. Therefore, the disposable container did not
have to be marked with its own country of origin. Similarly, the
purchaser of shoes packaged in a disposable container would fully
expect the container to bear information concerning its contents,
and there is no possibility of misleading the ultimate purchaser
as to the country of origin of the shoes. Accordingly, we find
that section 134.36(b) does not apply to preclude the granting of
an exception from individual country of origin marking for the
shoe boxes as disposable containers pursuant to 19 CFR
134.24(c)(1). Since no country of origin marking of the box is
required, the provisions of 19 CFR 134.46 do not apply.
HOLDING:
Cardboard shoe boxes imported by shoe manufacturers to
package domestic origin shoes are disposable containers excepted
from individual country of origin marking pursuant to 19 CFR
134.24(c)(1). 19 CFR 134.36(b) does not apply to such shoe boxes
to preclude the application of the exception or to require
additional country of origin marking.
Sincerely,
Marvin M. Amernick
Chief, Value, Special Programs
and Admissibility Branch