Mar-2-05 CO:R:C:S 735555 AT
TARIFF No.: 4911.10.0080
Ms. Denise Bennett-Chavoustie
Ms. Carin Moore
Trans Continental West Printing, Inc.
1420 Fifth Avenue, Suite 2200
Seattle, Washington 98101
RE: Classification and country of origin marking requirements of
various printed material imported from Canada; Article 509;
NAFTA Marking Rules; ultimate purchaser; section 134.1(d) of
the interim regulations; 19 CFR 134.32(d)
Dear Ms. Bennett-Chavoustie and Ms. Moore:
This is in response to your letter dated February 25 1994,
forwarded to our office by the New York Seaport Area, requesting
a ruling on the appropriate classification and country of origin
marking requirements for certain printed materials imported from
Canada to be sold or distributed in the U.S. free of charge.
Samples were submitted with your letter for review. We regret
the delay in responding.
FACTS:
You state that Trans Continental West Printing, Inc. intends
to import into the U.S. from Canada printed material consisting
of unbound advertising publications, bound home and real estate
publications, bound advertising publications and bound travel
guides. You also state that the printed material will be either
sold or distributed in the U.S. free of charge. You have
requested the appropriate classification and country of origin
marking requirements for the sample printed material. By letter dated July 22, 1994, you represent that the
printed material which is to be distributed in the U.S. free of
charge will have the word "free" printed on the front cover.
Also, any printed material which is intended to be sold in the
U.S. will have a "price" printed on the front cover.
By letter dated September 12, 1994, you have withdrawn your
request for a country of origin marking ruling for the following
printed material samples:
1.Harmon Homes
2.Ernst Home and Nursery
The following samples were submitted:
1.) Unbound Advertising Publications: The two samples
submitted are sheets of paper folded to form 8 pages of
advertising. They are published by (or on behalf of) a
drug store and a super market. They consist entirely
of advertisements for products sold in the stores.
There are no dates or numbers. U.S. references (e.g.
"Neenah, Wi" or "Kankakee, Il") are printed on the
advertisements themselves or on the front or back cover
of the publications.
2.) Bound Home and Real Estate Publications: These
are paper publications bound by staples. The three
samples submitted measure approximately 11 inches by 8
inches and have 104, 84, and 40 pages. They consist
entirely of advertisements pertaining to the sale of
homes: page after page of photographed homes with a
brief description below each photo, including, in most
instances, a price. Several pages in each publication
are advertisements for real estate companies, mortgage
companies, or real estate development companies. There
are no articles of either general or specialized
interest. One of the three samples is numbered and
dated, one is only dated, and the other is only
numbered. Several U.S. references also appear on these
publications. The word "free" appears on the front
cover of one of the sample publications.
3.) Bound Advertising Publications: The three samples
of this kind are paper publications bound by staples.
They measure 10 and 3/4 inches by 8 and 1/2 inches, 10
inches, and 5 inches by 8 and 1/4 inches. The first of
these publications is dated and has about 40 unnumbered
pages consisting entirely of advertisements for a
multitude of products and services, from mattresses and
appliances to auto body repair, carpet cleaning, and
landscape work. The second sample is dated and
numbered and has 16 pages. It is published by (or on
behalf of) a home and nursery store. It consists of
advertisements for particular products sold in the
store and brief articles concerning home decorating,
maintenance, and improvements and the kinds of products
needed to perform the decorating, maintenance, and
improvements discussed. The third sample is neither
dated nor numbered and has 15 pages. It is published
by an auto parts store. It consists entirely of
advertisements and coupons for products sold in the
store. The words "Printed in Canada" appear on the
back cover of each of the sample articles in black
lettering approximately 4.5 points (a point is a unit
of measurement approximately equal to 0.01384 inches or
nearly 1/72 inches).
4.) Bound Travel Guide: This sample is a paper
publication bound by staples. It measures 10 and 3/4
inches by 8 and 1/4 inches. It has 47 pages of ferry
schedules and numerous advertisements for hotels,
resorts, restaurants, stores, shops, and points of
interest (historical, geographical, and geological).
In addition to schedules, each ferry service and the
area it serves is briefly described. The guide serves
local commuters, vacationers, and travelers. The guide
publishes schedules for Washington (state) and British
Columbia destinations, through the Puget Sound and the
Straits of Juan de Fuca and Georgia. It is printed
three times per year and is dated but not numbered. A
price "$1.95 U.S./Cdn" is printed in black lettering on
the top right corner of the front cover of the travel
guide. Various cities located in Washington state
(such as "Seattle", "Vashon", "Fauntleroy") appear on
the front and back cover of the travel guide. U.S.
references also appear on the inside pages of the
guide. The words "Printed in Canada" are printed on
the lower left corner of the back cover in black
lettering approximately 5 points.
ISSUES:
1. Are the publications described above classifiable as
periodicals in heading 4902, Harmonized Tariff Schedule of the
United States (HTSUS), or as advertising materials in heading
4911, HTSUS?
2. What are the country of origin marking requirements for
imported printed material distributed in the U.S. in the manner
described above? LAW AND ANALYSIS:
I. CLASSIFICATION OF THE PRINTED MATERIAL
Classification under the HTSUS is accomplished in accordance
with the General Rules of Interpretation (GRI's). The systematic
detail of the Harmonized System is such that virtually all goods
are classified by application of GRI 1, that is, according to the
terms of the headings of the tariff schedule and any relative
section or chapter notes. In the event that goods cannot be
classified solely on the basis of GRI 1, and if headings and
legal notes do not otherwise require, the remaining GRI's will
then be applied in numerical order. Further, the Explanatory
Notes (EN's) to the Harmonized Commodity Description and Coding
System (HCDCS), which represent the official interpretation of
the tariff at the international level, facilitate classification
under the HTSUS by offering guidance in understanding the scope
of the headings and GRI's. Accordingly, the GRI's and EN's are
applied as the basis for the classification determinations
discussed below. (See Treasury Decision 89-80, 23 Cust. Bull.
379 (1989), 54 Fed. Reg. 35,127 (August 23, 1989).)
Unbound Advertising Publications
The unbound paper advertisements described in #1 above are
nothing more than unbound advertising papers and should be
classified under subheading 4911.10.0080, HTSUS, which provides
for other printed matter, trade advertising material, other.
Bound Home/Real Estate Publications and Product Advertising
Publications
It is clear that these publications are devoted entirely or
essentially to advertising. The home and real estate
publications (#2 above) contain, almost exclusively, advertising
for particular homes, with the occasional advertisement for a
mortgage company, real estate broker, or real estate development
the only exception. The product advertising publications (#3
above) are devoted entirely to the advertisement of products (and
services, such as auto repair) sold at retail. While this is
clear, the following question is raised: Does the fact that an
advertising publication is dated and published in a continuous
series mean that it is a periodical, even though the publication
contains only advertising? The EN's for heading 4902, HTSUS, provide the following
(EN's, HCDCS, Vol. 2, p. 693):
The distinguishing feature of the publications of this
heading is that they constitute one issue in a
continuous series under the same title published at
regular intervals, each issue being dated (even by
merely indicating the period of the year, e.g., "Spring
1966") and also frequently numbered. . . . These
publications usually consist essentially of reading
matter but they may also be profusely illustrated and
may even consist mainly of pictorial matter. They may
also contain advertising material. [Italics added.]
From the above EN, we know two things about the publications
of this heading: 1) they are dated and regularly published in a
continuous series, and 2) essentially, they consist of "reading
matter." The question is: Do advertising publications qualify as
"reading matter"?
In our view, the term "reading matter" suggests something
other than mere print that can be read. In other words, not all
printed text qualifies as reading matter in the context of
heading 4902, HTSUS. Such a broad meaning of the term would be
literally boundless. Thus, "reading matter" in the context of
this heading is appropriately limited.
Heading 4902, HTSUS, provides explicitly for newspapers,
journals, and periodicals, including professional journals and
periodicals. These are good examples of reading matter. The
tariff provision does not provide for advertising publications.
It merely provides that the newspapers, journals, and periodicals
of the heading may contain, in part, advertising material. The
EN uses the words "may contain" for advertising rather than
"consist of" which it uses for reading matter, reading matter
with illustration (even profuse illustration), or mainly
pictorial matter (which implies the presence of at least some
reading matter). The publications of this heading "consist of"
the foregoing; they do not "consist of" advertising. Moreover,
the plain and ordinary meaning of the term "reading matter"
suggests something other than advertising. While one can, and
does, read advertising, this fact does not make it "reading
matter."
Furthermore, the publications at issue do not fit the EN's
description of periodicals. The EN's for heading 4902, HTSUS,
describe journals and periodicals as follows (EN's, HCDCS, Vol.
2, p. 694): (2) Journals and other periodicals, issued weekly,
fortnightly, monthly, quarterly or half-yearly, either
in the form of newspapers or as paperbound
publications. They may be mainly devoted to the
publication of intelligence on subjects of a
specialized nature or sectional interest (e.g., legal,
medical, financial, commercial, fashion or sporting),
in which case they are frequently published by or for
the organizations of the interests concerned. Or they
may be of more general interest, such as the ordinary
fiction magazine. These include periodicals published
by or for named industrial concerns (e.g., motor car manufacturers) to promote interest in their products,
staff journals normally having circulation only within
the industrial, etc., organizations concerned and
periodicals such as fashion magazines which may be
issued by a trader or an association for publicity
purposes. (Bolding in original; italics added.)
We note that advertising is not mentioned in the above EN; nor is
there anything in the text to suggest that advertising
publications are included. In addition, the language, "[journals
and other periodicals] may be mainly devoted to the publication
of intelligence on subjects of a specialized nature or sectional
interest (e.g., legal, medical, financial, commercial, fashion or
sporting)," does not reasonably suggest that advertising is
contemplated.
Regarding the home and nursery publication that contains
brief articles about home decorating, maintenance, and
improvements, we believe that it does not qualify as reading
matter or intelligence as contemplated in heading 4902, HTSUS,
for the reason that it is essentially advertising. The articles
generally discuss the kinds of products (for carrying out the
discussed activities) that are sold in the store. In addition,
the publication is published by or on behalf of the nursery,
indicating its advertising intent.
Based on the foregoing, we conclude that the bound home/real
estate publications and the bound product advertising
publications are advertising materials, not periodicals. The
language of heading 4911, HTSUS, indicates that advertising
materials are classified thereunder. It provides for "[o]ther
printed matter . . .: [t]rade advertising material, commercial
catalogs and the like." (Italics added.) The EN's for heading
4911, HTSUS, explicitly state that advertising matter is included
under the heading. (See EN's, HCDCS, Vol. 2, p. 699.) While the
note also states that newspapers, periodicals, and journals,
whether or not containing advertising material, are excluded, we
have already determined that the sample home/real estate
publications and product advertising publications are not
periodicals within the meaning of heading 4902, HTSUS. Thus,
this exclusion is inapplicable. Finally, Legal Note 5 to Chapter
49 provides that publications essentially devoted to advertising
are not covered in heading 4901, HTSUS. It states the following:
"Such publications are to be classified in heading 4911."
Bound Travel Guide
The bound travel guide contains timetables for ferry
transport, brief descriptions of ferry routes and destinations,
and numerous advertisements for hotels, resorts, restaurants, and
places of historical and geographical interest. Its primary
function is to publicize the schedules of the various ferries
serving the area, giving notice to the traveling public of times
of departure and arrival, prices, and other information (such as
capacity of the ships and whether autos are transported). In
this way, the publication serves a decidedly utilitarian
function. In addition, its numerous advertisements also serve
the tourist and traveller. It is published three times per year
to accommodate seasonal schedule changes.
The travel guide does not contain the kind of reading matter
that heading 4902, HTSUS, contemplates (as discussed above in the
previous section). Reading matter must be something more than
printed text that can be read; it must be more than mere
advertising. Likewise, reading matter must be more than a mere
travel guide that provides primarily a utilitarian function in
the form of published ferry schedules, timetables, and
advertisements.
Further, the EN's description of periodical, taken as a
whole, does not encompass bus, train, airplane, cruise ship, and
ferry schedules. Dating them and publishing them at regular
intervals does not transform them into periodicals of the kind
contemplated by the heading. Moreover, the words of text
describing the routes, destinations, and points of interest are
more in the nature of tourist promotional literature. The EN's
for heading 4911, HTSUS, explicitly provide that tourist
propaganda is included in that heading. (See EN's, HCDCS, Vol.
2, p. 699.) In addition, Legal Note 5 to Chapter 49 provides
that tourist promotional literature is a kind of advertising
classifiable in heading 4911, HTSUS.
Based on the foregoing, we conclude that the travel guide at
issue is not a periodical classifiable under heading 4902, HTSUS.
Because it is not more specifically described in any other
heading of the chapter, it is classifiable in heading 4911,
HTSUS, as other printed matter, specifically in subheading
4911.10.0080, HTSUS, as trade advertising material, commercial
catalogs, and the like, other.
II. COUNTRY OF ORIGIN MARKING REQUIREMENTS FOR THE PRINTED
MATERIAL IMPORTED FROM CANADA TO BE DISTRIBUTED IN THE U.S.
IN THE MANNER DESCRIBED ABOVE
The marking statute, section 304, 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
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.
The country of origin marking requirements for a "good of a
NAFTA country" are also determined in accordance with Annex 311
of the North American Free Trade Agreement ("NAFTA"), as
implemented by section 207 of the North American Free Trade
Agreement Implementation Act (Pub. L. 103-182, 107 Stat 2057)
(December 8, 1993) and the interim amendments to the Customs
Regulations published as T.D. 94-4 (59 Fed. Reg. 109, January 3,
1994) with corrections (59 Fed. Reg. 5082, February 3, 1994) and
T.D. 94-1 (59 Fed. Reg. 69460, December 30, 1993). These interim
amendments took effect on January 1, 1994, to coincide with the
effective date of the NAFTA. The Marking Rules used for
determining whether a good is a good of a NAFTA country are
contained in T.D. 94-4 (adding a new Part 102, Customs
Regulations). The marking requirements of these goods are set
forth in T.D. 94-1 (interim amendments to various provisions of
Part 134, Customs Regulations).
Section 134.1(g) of the interim regulations, defines a "good
of a NAFTA country" as an article for which the country of origin
is Canada, Mexico or the U.S. as determined under the NAFTA
Marking Rules. Since the printed material is printed in Canada,
we will assume for purposes of this ruling that the country of
origin of the imported articles is Canada. Thus, the NAFTA
marking rules must be applied in determining the appropriate
marking requirements of the imported articles.
In determining the country of origin marking requirements
for the imported printed material, it first must be determined
who is the ultimate purchaser in the U.S. of the imported
articles. Section 134.1(d) of the interim regulations, provides that
the ultimate purchaser of a good of a NAFTA country is the last
person in the U.S. who purchases the good in the form in which it
was imported. If an imported article is to be sold at retail in
its imported form, the purchaser at retail is the ultimate
purchaser. If an imported article is to be distributed as a
gift, the recipient is the ultimate purchaser. However, if a
NAFTA article is imported and distributed as a gift, the ultimate
purchaser is the purchaser of the gift rather than the recipient.
See, Section 134.1(d)(4) of the interim regulations.
In this case either the printed material will be distributed
in the U.S. free of charge or it will be sold to the U.S.
consumer.
Ultimate Purchaser of the Imported Printed Material
1. Imported Printed Material Distributed in The U.S. Free of
Charge
In accordance with section 134.1(d) of the interim
regulations, the ultimate purchasers of the printed material
which is imported from Canada, a NAFTA country, (assuming the
imported article is a good of Canada) and is to be distributed
free of charge in the U.S., as gifts or giveaways, are the U.S.
companies which pay Trans Continental West the fee for printing
the various advertisements in the publications. The U.S.
companies which pay for the printing of the advertisements are
the last persons in the U.S. to purchase the imported articles in
their imported condition and not the consumer who receives the
imported article free of charge, as a gift or giveaway.
Accordingly, the ultimate purchasers of the imported printed
material which is to be distributed free of charge are the U.S.
companies which pay Trans Continental West the fee to be
advertised in the publication.
2. Imported Printed Material Sold in the U.S.--Not Distributed
Free of Charge
With respect to the imported printed material which is to be
sold in the U.S., rather than distributed free of charge, the
ultimate purchasers of the imported articles in accordance with
section 134.1(d) are the U.S. consumers who purchase the printed
advertisement publications. The U.S. consumers who purchase the
advertisement publications are the last persons in the U.S. to
purchase the imported articles in their imported condition--not
the U.S. companies who pay Trans Continental the fee for printing
the advertisements.
The last issue which must be examined is whether the
advertisement publications are excepted from country of origin
marking.
Are The Imported Printed Materials Excepted From Country of
Origin Marking
1. Imported Printed Material Distributed Free of Charge
An article is excepted from marking under 19 U.S.C. 1304
(a)(3)(D) and section 134.32(d), Customs Regulations (19 CFR
134.32(d)), if the marking of a container of such article will
reasonably indicate the origin of such article. Accordingly,
provided the outermost container is marked with the article's
origin, the printed material itself, which is to be distributed
free of charge, is excepted from country of origin marking.
Section 134.46, Customs Regulations (19 CFR 134.46),
generally requires that when a name of any U.S. city or locality
or the name of any foreign country other than the country or
locality in which the article was manufactured or produced,
appears 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 a comparable size, the
name of the country of origin preceded by "Made in," "Product
of," or other words of similar meaning. The purpose of this
section is to prevent the possibility of misleading or deceiving
the ultimate purchaser as to the actual country of the imported
goods.
Although section 134.46-type references, appear on the
advertisement publications, the special marking requirements of
19 CFR 134.46 do not apply for marking the imported printed
materials, if they are excepted from marking pursuant to 19 CFR
134.32(d).
In this case, where the advertisement publications are
distributed free of charge to consumers in the U.S., the ultimate
purchasers of the publications are not the U.S. consumers who
receive the articles free of charge, but rather are the U.S.
companies who pay for the advertisements. Under these
circumstances, the U.S. references which appear on the printed
material itself would not mislead or deceive the ultimate
purchasers as to the article's actual origin given the fact that
the outermost containers will be marked with the article's actual
country of origin. Accordingly, the marking requirements under
19 CFR 134.46 will not be invoked when such references appear on
the advertisement publications which are to be distributed free
of charge in the manner described above, provided the outermost
containers which reach the ultimate purchasers in the U.S. are
marked with the article's actual country of origin, "Canada",
pursuant to a 19 CFR 134.32(d) marking exception. 2. Imported Printed Material Sold to U.S. Consumers
Where the imported advertisement publications are to be sold
to consumers in the U.S., the U.S. consumers are the ultimate
purchases of the imported articles--not the U.S. companies who
pay for the advertisements. Therefore, the imported
advertisement publications must be marked to indicate to the U.S.
consumers that "Canada" is the country of origin of the imported
publications. In this case, various U.S. references may appear
on the advertisement publications themselves, whether on the
front or back cover or on the advertisement pages themselves.
Thus, the special marking requirements of 19 CFR 134.46 are
triggered. This being the case, a strict application of section
134.46 would require that the country "Canada" be marked in close
proximity and at least in comparable size lettering preceded by
the words "Made in" anywhere a U.S. reference would appear on the
publications. However, we find that, to require such marking
would be overly burdensome to the importer since compliance would
be virtually impossible.
As previously stated, the purpose of section 134.46 is to
prevent the possibility of misleading or deceiving the ultimate
purchaser as to the actual country of the imported goods. Thus,
provided the printed material is conspicuously marked in such a
manner as to clearly indicate to the U.S. consumer prior to
purchase that "Canada" is the actual country of origin of the
article the purpose of section 134.46 would be satisfied.
A country of origin marking is considered to be
conspicuous, if the marking is easy to find and read upon a
casual examination of the article. Review of the sample travel
guide indicates that the country of origin marking "Printed in
Canada" appears on the back cover near the lower left-hand corner
of the guide in black lettering approximately 5 points. We find
that this country of origin marking does not satisfy the
conspicuousness requirement of section 134.46 and is not an
acceptable country of origin marking for the travel guide. The
back cover is not a location where a U.S. consumer would look or
expect to find the country of origin of the publication. Also,
we note that, aside from the country of origin marking, there is
no other information on the back cover. With respect to the size
of the lettering in this case (5 points), we find that it is
acceptable in that it is easy to read.
However, the front cover of the travel guide in our opinion
would be a conspicuous location to mark the travel guide with the
country of origin marking "Printed in Canada". In HQ 731663
(July 18, 1989) Customs stated that with respect to books:
Because retail purchasers could reasonably expect to find
all the pertinent publication, printing and copyright
information related to a book on either the front or back
of the title page and could therefore, look at the title
page if they were confused by information appearing
elsewhere, an importer satisfies 19 CFR 134.46 if the
country of origin is placed on the front or back of the
title page and otherwise complies with the requirements
of 19 CFR 134.46.
Even though the travel guide is not a published book, we
nevertheless, believe that the front cover is similar to the
title page of a book. Individuals would normally look at the
front cover to find information about the travel guide. Also,
inasmuch as the front cover indicates to the individual purchaser
the price of the travel guide and the areas covered in the guide,
it is reasonable to believe that this would be a location where
the individual purchaser would first look for information about
the travel guide.
HOLDING:
The paper publications at issue - the unbound advertising
publications, the bound home and real estate publications, the
bound product advertising publications, and the bound travel
guide - are classifiable in subheading 4911.10.0080, HTSUS. The
applicable duty rate is "Free."
Assuming that the imported advertisement publications are
goods of Canada, a NAFTA country, and are to be imported into the
U.S. in the manner described above, the ultimate purchaser of the
imported publications that are to be distributed in the U.S. free
of charge are the U.S. companies who pay Trans Continental West
the fee for printing the publications and not the consumers who
receive the imported articles free of charge. Thus, provided the
outermost containers are marked to indicate "Canada" as the
origin of the imported advertisement publications pursuant to a
19 CFR 134.32(d) marking exception, the imported publications
themselves are excepted from country of origin marking, and the
special marking requirements of 19 CFR 134.46 are not invoked by
the U.S. references which appear on the publications.
The ultimate purchasers of the imported advertisement
publications which are to be sold in the U.S. in the manner
described above are the U.S. consumers who purchase the
publications not the U.S. companies which pay for the printing of
the publications. Accordingly, these advertisement publications
must be marked to indicate "Canada" as the origin of the imported
publications. Marking the publications "Printed in Canada" on
the back cover is not an acceptable country of origin marking for
the imported advertisement publications for the reasons set forth
above. A copy of this ruling letter should be attached to the entry
documents filed at the time this merchandise is entered. If the
documents have been filed without a copy, this ruling should be
brought to the attention of the Customs officer handling the
transaction.
Sincerely,
John Durant, Director
Commercial Rulings Division