MAR 2-05 CO:R:C:V 735131 LR
Charles Routh, Esq.
Garvey, Schubert & Barer
Second & Seneca Building
1191 Second Avenue
Seattle, Washington 98101
RE: Country of origin marking of potting soil mixture; peat;
substantial transformation; mixture
Dear Mr. Routh:
This is in response to your letter dated April 15, 1993,
requesting a ruling on behalf of Fisons Horticulture Inc.
("Fisons") on the country of origin marking requirements of
potting soil imported from Canada.
FACTS:
Fisons imports potting soil from Canada. Over 80 percent of
the product by both volume and value is peat moss produced in
Canada. Although the actual proportion may vary depending on the
specific product, part of the product is lime, fertilizer,
wetting agents, perlite and other additives. A large proportion
of these items is imported into Canada from the United States.
They are mixed in Canada according to a set formula to make
potting soil mix, filled into bags wrapped in plastic and
exported to the United States. Approximately 27 different
varieties and sizes of potting soil mix are involved. You
indicate that Fisons has been importing potting soil from Canada
for eight years marked as follows: "This package contains a
mixture of products originating in Canada, U.S. or both".
However, recently Customs officials in Blaine, WA have asked that
the marking be changed to "Produced in Canada". Fisons would
like a prospective ruling in order to ensure uniform Customs
treatment throughout the country. If new wording is necessary,
Fisons would like a reasonable time to use the existing bags and
convert to the new marking.
ISSUE:
What is the proper country of origin marking for the potting
soil imported from Canada?
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. 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(b), Customs Regulations (19 CFR 134.1(b)),
indicates that the country of origin is the country of
manufacture, production, or growth of any article of foreign
origin entering the United States. Further work or material
added to an article in another country must effect a substantial
transformation in order to render such other country the "country
of origin" within the meaning of this part. A substantial
transformation occurs when the work or material added changes the
name, character or use of the article in question.
Several Customs rulings involve the combining of ingredients
according to a formula. In Headquarters Ruling Letter ("HRL")
733207, November 21, 1990, foreign and U.S. raw botanical
ingredients were variously blended together in the U.S. to create
aromatic products called "Potpourri". Customs found that the
production of the potpourri in the U.S., according to formula,
substantially transformed the imported constituent materials into
a product of the U.S. The ruling states:
The herbs, flowers, spices and woodchips lose their separate
identities upon incorporation into the potpourri, and
acquire a new name, character, and use. Despite the fact
that the botanicals, for example, remain recognizable as
parts of flowers and plants, their character and use becomes
entirely different, having taken on the commercial identity
of the potpourri.
Similarly, in HRL 734076, September 10, 1991, Customs ruled that
imported tomato powder is substantially transformed when it is
blended with specific quantities of domestic ingredients to make
seasoning mixes. The tomato powder, which constituted
approximately 6% - 23% by weight of the finished product, was
combined with seasonings, spices and other ingredients. However,
in HRL 735085, June 4, 1993, Customs determined that frozen
broccoli and cauliflower of Mexican origin were not substantially
transformed when combined in the U.S. with frozen vegetables of
U.S. origin. The determination was based in part on the fact
that the broccoli and cauliflower remain clearly identifiable
within the mixtures and are the largest (or among the largest)
constituents by volume. The potpourri ruling was distinguished
as follows:
Despite the fact that botanical items remained recognizable
as parts of flowers and plants, their character and use
became entirely different. They were blended to achieve a
single pleasant aroma. We do not believe that the combining
of the vegetables achieves the creation of a new article in
the same sense or to the same degree as in the potpourri
ruling.
In the case before us, we find that the lime, fertilizer,
wetting agents, perlite and other additives are substantially
transformed when they are combined in Canada according to formula
with Canadian peat moss to form potting soil mix. These
ingredients lose their separate identities and become an integral
part of the potting soil mix. Unlike the broccoli and the
cauliflower in HRL 735085, supra, which remained clearly
identifiable within the mixture and were the largest or among the
largest among the constituents by volume, the ingredients sent to
Canada do not remain clearly identifiable and comprise a small
portion both by volume and value of the finished product. Like
the potpourri ingredients and the tomato powder, the lime,
fertilizer, wetting agents, perlite and other additives are
substantially transformed into a new article of commerce, namely
potting soil mix, as a result of mixing them together in Canada
along with Canadian peat moss. Accordingly, we find that when
imported to the U.S., the potting soil mix is a product of Canada
and should be clearly marked "Canada", "Product of Canada" or
other similar marking.
The current marking, "This package contains a mixture of
products originating in Canada, U.S. or both", is not acceptable.
The origin of the constituent materials may be indicated only if
the country of origin of the potting soil mix, Canada, is clearly
indicated and the requirements of 19 CFR 134.46 are satisfied
(i.e., the country of origin must be preceded by words such as
"Made in" or "Product of" and must appear in comparable size
letters and in close proximity to these references). For
example, a marking such as "Product of Canada - contains Canadian
Peat Moss and other ingredients from " would be
acceptable.
Because the current method of marking has been used for so
long and provides some origin information to the consumer,
Customs officials at the port of entry are authorized to make
reasonable accommodations to allow Fison to use existing bags
while converting to the new marking. The field offices should be
contacted directly regarding this matter.
HOLDING:
The present method of marking does not satisfy the
requirements of 19 U.S.C. 1304 and 19 CFR Part 134. The potting
soil mix should be marked to indicate Canada as the country of
origin.
Sincerely,
John Durant, Director
Commercial Rulings Division
cc: Area Port Director
Blaine, WA 98230
Attn: Joe Kuttle, Import Specialist