MAR-2-05 CO:R:C:V 734190 GRV
District Director of Customs
U.S. Customshouse
1 East Bay Street
Savannah, GA 31401
RE: Internal Advice relative to country of origin marking
of reusable (piped edged and zippered) vinyl bags
imported to be filled with durable good (blankets and
pillow) merchandise. 19 CFR 134.22(b); 19 CFR
134.23(a); C.S.D. 87-1; 731661; 733675; 732823; 19 CFR
134.24; 730530; 729476; C.S.D. 88-28; 733716; 19 CFR
134.24(c); disposable packaging
Dear Sir:
This is in response to your memorandum of May 23, 1991,
requesting internal advice relative to the country of origin
marking requirements applicable to certain vinyl bags imported
empty to be filled with blankets and pillow merchandise. A
sample vinyl bag was submitted for examination.
FACTS:
Clear vinyl bags, designed to completely enclose the mer-
chandise contained therein, are imported empty by the Vinyl Bag
Company to be sold to the Piedmont Paper Company, which fills the
bags with pillows and blankets for retail sale. The vinyl bags
are imported in cartons containing 144 bags each. The cartons
are marked with the country of origin of the vinyl bags, but the
individual bags are not marked. The bags are box-like when
filled, measuring approximately 18" in length, 15" in width, and
5" in depth. The edges of the bag are piped with a white vinyl
strip that is sewn on. A zipper is attached at one end of the
bag; opening only three sides of one bag end, to allow access to
the contents.
Internal advice is requested because the importer claims
that he has been subjected to inconsistent treatment at various
ports regarding whether the bags have to be marked with thier
country of origin marking or not. The importer contends that the
bags are disposable--not capable of reuse--and, therefore, are
exempt from marking requirements under the provisions of 19 CFR
134.24(c). Your office contends that the vinyl bags are reusable
--not disposable--and, therefore, should be marked in accordance
with 19 CFR 134.23(a). Your position is based on the sturdy
construction and durability of the bag, as well as the zipper
feature. Further, you state that because the bag is not dedi-
cated to a specific shape it can store various articles, attest-
ing to its reusable character.
Two other issues raised by the circumstances of this case
are (1) the identity of the ultimate purchaser, and (2) whether
the imported bags could not be marked prior to their shipment to
the U.S. except at an expense economically prohibitive of their
importation--a condition which excepts the imported articles
from the marking requirements. Regarding the identity of the
ultimate purchaser, the importer contends that Piedmont Paper
Co., is fully aware that these bags are made in China, and that
the retail consumer is buying the article in the bag, not the bag
itself, whereas, your office contends that since the bag is not
substantially transformed by Piedmont Paper--only filled--they
are not the ultimate purchasers. Regarding the economically
prohibitive marking expense issue, although the importer claims
that it is a very expensive procedure that exceeds the cost of
the item itself, your office dismisses this argument because no
documentary evidence was submitted in support of this claim.
Further, it was not clear whether the importer was claiming that
domestic marking operations were expensive or that foreign
marking operations were expensive.
Your office also requests that if Headquarters agrees with
your assessment in this matter to provide an acceptable manner of
marking the bag.
ISSUE:
Whether the vinyl bags (piped and zippered) imported empty
to be filled with blanket and pillow merchandise constitute
reusable or disposable packaging for purposes of the country of
origin marking requirements of 19 U.S.C. 1304 and 19 CFR Part
134, Subpart C.
LAW AND ANALYSIS:
The marking statute, 304 of the Tariff Act of 1930, as
amended (19 U.S.C. 1304), provides that, unless excepted, every
article of foreign origin (or its container) imported into 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 pur-
chaser the English name of the country of origin of the article.
Part 134, Customs Regulations (19 CFR Part 134), implements the
country of origin marking requirements and exceptions of 19
U.S.C. 1304.
The purpose of this provision is to permit the "ultimate
purchaser" in the U.S. to choose between domestic and foreign-
made products, or between the products of different foreign
countries. See, United States v. Friedlaender & Co., C.A.D. 104,
27 CCPA (1940); National Juice Products Association v. United
States, 10 CIT 48, 628 F.Supp. 978 (1986). The "ultimate
purchaser" is defined generally as the last person in the U.S.
who will receive the article in the form in which it was
imported. 19 CFR 134.1(d).
In C.S.D. 87-1 (dated October 10, 1986) we considered
whether imported plastic shopping bags, given by retail stores to
their customers with the purchase of items, were subject to the
country of origin marking requirements of 19 U.S.C. 1304. In
that case we found that the "ultimate purchaser" of the plastic
shopping bags was not the retail store, but its customer who was
the user of the bags and the last to receive them in the form in
which they were imported. Similarly here, the ultimate purchaser
of the imported vinyl bags is the customer and not Piedmont
Paper, as the customer is the last person in the U.S. to receive
the item in the form in which it is imported.
Where the articles imported constitute containers, 19 CFR
Subpart C is applicable, and section 134.22(b) of this subpart
provides generally that containers for imported merchandise which
are subject to treatment as imported articles under the
Harmonized Tariff Schedule of the United States (19 U.S.C. 1202),
shall be marked to indicate clearly the country of their own
origin in addition to any marking which may be required to show
the country of origin of their contents. However, the country of
origin marking requirements applicable to containers imported
empty depend, in part, on whether the containers are reusable or
disposable in nature. Specifically, 134.22(d)(3) and 134.24(c)
provide that disposable containers imported by persons or firms
who fill them with various products which they sell may be
excepted from individual marking pursuant to 19 U.S.C. 1304(a)
(3)(D). However, this exception is not applicable if the
imported containers are reusable. Thus, the vinyl bags may be
excepted from individual marking only if they are disposable
containers, as provided at 134.24. Section 134.24(a) provides
that disposable containers subject to the provisions of this
section are the usual 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.
In contrast, under 134.23, containers are considered
reusable if they are either designed for or capable of reuse
after the contents have been consumed, or impart the essential
character to the whole importation. Such containers, whether
imported full or empty, must be individually marked to indicate
the country of their own origin with a marking such as,
"Container Made in (name of country)." Illustrative examples of
the containers contemplated by this section include heavy duty
steel drums, tanks, and other similar shipping, storage,
transportation containers capable of reuse.
In determining whether particular containers are reusable or
disposable, Customs has considered both the construction of the
container and its function. For example, in Headquarters Ruling
Letter (HRL) 732823 dated January 19, 1990, we considered whether
imported cardboard shoe boxes used to package U.S.-origin shoes
were disposable and, therefore, exempt from individual country of
origin marking or reusable and, therefore, required to be indi-
vidually marked with their country of origin. Finding that card-
board shoe boxes constituted the primary, i.e., usual and ordi-
nary, types of containers for shoes and that, being made of non-
corrugated cardboard, they were ordinarily discarded after their
contents had been consumed, we concluded that they fell squarely
within the category of disposable containers and, thus, were
exempt from individual marking.
However, in C.S.D. 87-1 we distinguished between plastic
bags that were flimsy, of the "throw-away" variety, and those
that were durable, with a separate identity and use apart from
the products which may be carried in them, and concluded that
these latter bags, which were durable enough to be used again,
must be individually marked with their country of origin. This
decision was affirmed on reconsideration (HRL 730530 dated July
9, 1987). See also 729476 dated October 10, 1986 (plastic
shopping bag was durable and capable of reuse). Cf., C.S.D. 88-
28 and HRLs 733716 dated June 6, 1991, 733675 dated May 16, 1991,
and 731661 dated December 16, 1988 (finding that the subject
containers were disposable).
Applying these considerations to the vinyl bags at issue,
and after examining the sample submitted, we believe they do not
constitute the usual ordinary types of containers ordinarily
discarded after the contents have been consumed. Rather, they
constitute the type of durable plastic bags "clearly suitable for
repetitive use;" distinguishable from simple, "flimsy" bags
ordinarily discarded after the contents are consumed. Therefore,
the bags are not excepted from individual marking under 134.24
and 19 U.S.C. 1304(a)(3)(D) and must be conspicuously marked to
indicate their own country of origin. This determination is
based on the following factors: (1) the sturdy construction of
the bag; the edges are reinforced with piping to encourage, if
not ensure, continued reuse; (2) the zipper feature at one end of
the bag allows repetitive access to the bag; (3) the plastic
employed to make these bags is of a durable, i.e., thick, nature,
in contrast to the "flimsy," i.e., thin, "throw-away" variety,
considered in C.S.D. 87-1; and, (4) a consideration of the
nature of the merchandise packaged in the vinyl bags: pillows
and blankets are durable goods that can be seasonally used and
put away. Accordingly, the marking provisions of 134.23(a) are
applicable and the vinyl bags must be individually marked.
An appropriate marking for the bags would be "Bag made in
_____."
Regarding the issue of whether the individual bags could not
have been marked prior to shipment to the U.S. except at an
expense economically prohibitive of the articles importation--a
condition which excepts the articles from marking requirements
under 19 U.S.C. 1304(a)(3)(C) and 19 CFR 134.32(c), no documen-
tary evidence has been submitted to support this claim. Accord-
ingly, we cannot determine whether this exception is applicable.
However, it should be noted that consideration of this marking
exception requires a factually-intense review of all relevant
cost data associated with the articles' costs prior to
importation.
HOLDING:
The reinforced, zippered vinyl bags imported empty to be
filled with durable (blankets and pillow) merchandise constitute
reusable packaging for purposes of the country of origin marking
requirements of 19 U.S.C. 1304 and 19 CFR Part 134, Subpart C.
Accordingly, the bags must be individually and conspicuously
marked "Bag made in " (or other similar marking), so that
the ultimate purchaser--the customer, not the manufacturer of the
merchandise to be packaged--in the U.S. can find the country of
origin marking easily and read it without strain.
As no documentary evidence was submitted to support the
claim that the individual bags could not be marked prior to
shipment to the U.S. except at an expense economically prohibi-
tive of their importation, we cannot determine whether this
marking exception under 19 U.S.C. 1304(a)(3)C) and 19 CFR
134.32(c) is warranted.
Sincerely,
John Durant, Director
Commercial Rulings Division