MAR-2-05 CO:R:C:V 734420 RSD
Area Director
U.S. Customs
J.F.K Airport
Building 178
Jamaica, New York 11430
RE: Country of origin marking requirements for earrings that
will be imported in bulk and repacked in the individual packages
for sale; repacking, district director discretion; 19 CFR 134.34
Dear Sir:
This is in reference to a ruling request submitted by the
law firm Sharretts, Paley, Carter & Blauvelt on behalf of their
client, Crystal Brands Jewelry Group (Crystal Brands), concerning
the importation of certain earrings imported in bulk that will be
repacked in the U.S. Since the subject of this request pertains
to on going importations in your area and we have had discussion
with your office in this matter, we are treating the ruling
request as a request for internal advice. Samples of the
earrings in the repacked retail packages were provided for our
review.
FACTS:
Crystal Brands is seeking to import earrings produced in
Costa Rica into the U.S. without individual country of origin
markings through the port of J.F.K. Airport. The earrings will
be imported in bulk. Crystal Brands states that it will file a
certification with Customs indicating that it will repack the
earrings in individual packages, which will be marked to indicate
the country of origin of the earrings, before they reach the
ultimate purchaser.
Crystal Brands indicates that after importation all of the
earrings will be shipped to a single Crystal Brands facility
located in Providence, Rhode Island. The earrings will be
mounted in pairs on plastic cards bearing the brand name Trifari.
A bar code sticker will be attached to the front panel of each
card which bears the statement "MADE IN COSTA RICA." The bar
codes will be used to convey price and inventory information at
the retail level. (On the submitted sample the bar code sticker
is affixed to the back panel of the card). All of the imported
earrings will be labelled in this manner and will reach the
ultimate purchaser wrapped in clear cellophane film, through
which the country of origin marking, "MADE IN COSTA RICA," can be
seen. Crystal Brands states that several styles of earrings
cannot be marked with their country of origin prior to
importation because of their size or configuration.
ISSUE:
When can the District/Area Director of Customs exercise his
discretion and allow certification procedures of 19 CFR 134.34
for the importation of unmarked merchandise which will be
repacked in properly marked containers?
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 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. 27 C.C.P.A. 297 at 302; C.A.D. 104 (1940).
Articles for which the marking of the containers will
reasonably indicate the origin of the article are excepted from
marking under 19 U.S.C. 1304(a)(3)(D). For an exception to be
granted under 19 U.S.C. 1304(a)(3)(D), the article must be
imported in the container and that container must reach the
ultimate purchaser unopened. See also 19 CFR 134.32(d).
Section 134.34 Customs Regulations (19 CFR 134.34), provides
that an exception may be authorized in the discretion of the
district director under 19 CFR 134.32(d) for imported articles
which are to be repacked after release from Customs custody under
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 to secure such verification, as may
be necessary by certification and the submission of a sample or
otherwise, of the marking prior to liquidation of the entry.
In HQ 732808, December 12, 1989, we indicated that the
discretion of the district director under 19 CFR 134.34 is quite
broad. He may determine whether the marking of the repacked
containers will comply with 19 U.S.C. 1304. He may determine
whether direct supervision, certification, verification, or
review of a sample is necessary to accomplish the purposes of 19
U.S.C. 1304 and to extend the 60-day liquidation period.
In that same ruling, we also indicated that the district
director would be acting within the scope of his discretion in
determining that the 19 U.S.C. 1304(a)(3)(D) exception may be
approved for all entries made over an extended or indefinite
period time, rather than on an entry-by-entry basis. An
important element in the exercise of the district director's
discretion is his assessment of whether the company requesting
the exception can be relied upon to carry through on its
undertakings. Another factor to be considered is whether the
district has adequate resources to provide the continuing
supervision necessary to ensure proper country of origin making
after importation.
Additional factors that the district director could consider
are the importer's history of violations and record in complying
with Customs procedures and regulations, whether the importer is
doing the repacking himself, or having another party do the
repacking, and whether the repacking is done on the importer's
premises within the Customs district in which the merchandise was
imported. Where the district director determines that the
importer may not utilize the certification procedure of 19 CFR
134.34, he/she must able to articulate a specific reason for this
decision.
In this case, the following factors are relevant:
1. Due to the size and shape of many of the earrings, the only
way to mark them prior to importation is by means of hangtags.
These tags would have to be removed when they are placed onto the
retail cards after importation.
2. The retail card which is to be affixed will contain not only
country of origin information but also a computer generated bar
code which is used by retailers to convey inventory and price
information. This method of displaying earrings on a retail card
is a common one. It is highly unlikely that Crystal Brands will
neglect to place the retail card on the earrings.
3. The proposed marking whether on the front or the back of the
retail card is clearly conspicuous.
4. Crystal Brands will be do the repacking itself at its own
facility; this should make supervision of the marking feasible,
even though the repacking will be done outside the Customs
district in which the goods are to be imported. Assuming Crystal
Brands has a history of complying with country of origin marking
requirements, direct supervision of the marking would not be
needed on a continual basis.
HOLDING:
Based on the above considerations, we believe that the 19
CFR 134.34 procedures were designed to cover the situation
presented by Crystal Brands and that absent good reason why such
procedures are not appropriate (e.g., the company has a history
of marking problems and cannot be relied upon to carry through
its proposal), they should be approved. Please notify Crystal
Brands of your decision.
Sincerely,
John Durant, Director,