MAR-2-05 CO:R:C:V 733151 EAB
Art Henry, President
Art Henry Golf Sales
1522 Edgewood Place
Louisville, KY 40205
Re: Country of origin marking requirements of imported golf club
heads to be used in the manufacture of golf clubs. Substan-
tial transformation; ultimate purchaser; 19 U.S.C. 1304; 19
CFR 134.1(d); 19 CFR 134.35; 19 CFR 134.36(b); 19 CFR
134.46; Koru North America v. United States; United States
v. Friedlaender & Co.; United States v. Gibson-Thomsen Co.;
National Juice Products Association v. United States; ORR
824-70; HQ 728213; HQ 724901; HQ 733185; HQ 656214
Dear Mr. Henry:
This is in reply to your letter dated August 15, 1989, in
which you request a ruling on the country of origin marking
requirements of golf club heads that you wish to import and
resell to specialty manufacturers of golf clubs. We regret the
delay in responding.
FACTS:
You wish to import golf club heads for specialty manufactur-
ers of golf clubs. These specialty manufacturers take an indivi-
dual golf club head, golf club shaft and golf club grip and cus-
tom build the parts into a product that is tailor-made for a
specific customer. You indicate that generally the heads are
imported and the shafts and grips are made in the U.S. For pur-
poses of this ruling, we are assuming the shaft and grip are of
U.S. origin. You ask if golf club heads with designations of a
city, state, region, etc., may be imported without having the
name of the country of origin stamped into the golf head.
ISSUE:
What are the country of origin marking requirements of
imported golf club heads to be used in the domestic manufacture
of customized golf clubs?
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 Interna-
tional Trade stated in Koru North America v. United States, 701
F.Supp. 229 (1988): "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 (1940) at 302: "Congress intended
that the ultimate purchaser should be able to know by an inspec-
tion of the marking on the imported goods that 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(d), Customs Regulations (19 CFR
134.1(d)), defines the ultimate purchaser as "generally the last
person in the U.S. who will receive the article in the form in
which it was imported. If an imported article will be used in
manufacture, the manufacturer may be the ultimate purchaser if he
subjects the imported article to a process which results in a
substantial transformation of the article." Under the provisions
of 19 CFR 134.35, if the manufacturer is the ultimate purchaser,
the imported article is excepted from individual marking provided
the outermost containers in which the article is imported are
marked.
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 CCPA 267 (1940);
National Juice Products Association v. United States, 10 CIT 48,
628 F.Supp. 978 (CIT 1986); Koru North America v. United States,
supra.
Customs ruled in ORR 824-70 (August 24, 1970), that a manu-
facturer who purchased imported golf club heads, either finished
or unfinished, and assembled them with shafts and grips of U.S.
origin into finished golf clubs, was the ultimate purchaser of
the imported golf club heads. The ruling directed that if the
Regional Commissioner of Customs was satisfied that the imported
golf club heads were to be used by an original equipment manufac-
turer, then the golf club heads were excepted from individual
marking. In HQ 728213 (July 3, 1985), Customs reiterated this
position. In HQ 724901 (April 9, 1984), Customs advised that the
ultimate purchaser of imported golf club grips to be used in the
manufacture of golf clubs was the golf club manufacturer. Customs
stated that golf club grips which are imported by golf club manu-
facturers in the U.S. are substantially transformed into new and
different articles of commerce, i.e., golf clubs.
In HQ 733185 (April 11, 1990) Customs reiterated the posi-
tion that golf club grips imported by golf club manufacturers or
intended to be sold to golf club manufacturers would be excepted
from individual marking. However, Customs also found that
imported golf club grips that were to be used in the repair or
replacement of grips on completed clubs that already had been
purchased or received by the consumer must be individually
marked. Customs reasoned that the mere fitting of a replacement
grip onto a golf club shaft is a simple assembly not constituting
a substantial transformation.
In this case, your customer, the specialty manufacturer of
golf clubs, is the ultimate purchaser of the imported heads. As
in ORR 824-70, your customers assemble imported golf club heads
with U.S. grips and shafts to form a new and different article,
i.e., a golf club. Pursuant to 19 CFR 134.35, only the outermost
container of the imported heads must be marked to indicate the
country of origin of the articles, provided the district director
at the port of entry is satisfied that the imported heads will be
used only by an original equipment manufacturer of golf clubs.
With regard to imported golf club heads with U.S. addresses,
it should be noted that 19 CFR 134.46 provides that in any case
in which the words "United States," or "American," the letters
"U.S.A.," any variation of such words or letters, or the name of
any city or locality in the U.S. appear 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
in a comparable size the name of the country of origin preceded
by "Made in," or "Product of," or other words of similar meaning.
In addition, as provided in 19 CFR 134.36(b), an exception from
marking shall not apply to any article bearing any words
described in 19 CFR 134.46 which imply that an article was made
or produced in a country other than the actual country of origin.
In this regard, Customs has determined that an imported golf club
head bearing the U.S. address of the importer is not excepted
from individual country of origin marking. See HQ 656214, May 25,
1990. Accordingly, the golf club heads that you import are
excepted from individual marking only if they bear no U.S.
reference. If they do, the requirements of 19 CFR 134.46 apply.
For example, "Joe Smith Custom," or "Joe Smith Custom, U.S.A.,
Made in Taiwan" or "Joe Smith Custom, Bayonne, NJ, Made in
Japan" are acceptable markings, but "Joe Smith Custom, U.S.A." is
unacceptable.
HOLDING:
Imported golf club heads which are assembled with grips and
shafts of U.S. origin by original equipment manufacturers of golf
clubs are excepted from individual country of origin marking and
only the outermost containers of such heads must be marked,
pursuant to 19 CFR 134.35, provided that (1) the heads do not
bear the words "United States," or "American," the letters
"U.S.A.," any variation of such words or letters, or the name of
any city or locality in the U.S.; and (2) Customs officials at
the port of entry are satisfied that the articles will reach the
original equipment manufacturers in their original, unopened
containers.
Statements to this effect may be required by the district
director at the port of entry.
Sincerely,
John Durant, Director
Commercial Rulings Division