MAR-2-05 RR:CR:SM 560817 KSG
Steven P. Sonnenberg
Sonnenberg & Anderson
200 South Wacker Drive
38th Floor
Chicago, Illinois 60606
RE: globe stands; 19 U.S.C. 1304; substantial
transformation; 19 CFR 134.41(b)
Dear Mr. Sonnenberg :
This is in reference to your letters of January 19,
1998, and May 21, 1998, requesting a binding ruling on the
country of origin marking of imported stands with globes on
behalf of Maitland- Smith U.S., Inc. At your request, a
conference was held at Headquarters on this ruling request.
FACTS:
The imported articles in this case are three styles of
globes mounted on stands. You submitted photographs of
these three styles. Maitland- Smith purchases the globes,
which are made in the U.S., from a U.S. company. Each globe
is marked as a product of the U.S. This marking is printed
on the surface of the globe. You stated that the surface of
the globes is delicate.
The U.S. made globes are shipped to the Philippines.
In the Philippines, the globe stands are made and the globes
are inserted into the stands. You provided details of the
processing for three styles of globes mounted in stands.
The first style (item 1336-003) is a globe mounted in a
carved mahogany stand. In the Philippines, the wood is cut,
veneer and solid wood components are laminated together, the
wood is carved, sanded, and assembled into a stand, and the
stand is polished according to the prescribed finish. Brass
rollers are made and attached to the stand. The globe is
then attached to the stand by being placed on the rollers
and screwed into place with a screwdriver. The cost of the
globe stand is $343.86, the cost of the globe is $73.13 and
the cost to fit the globe to the stand is $5.53.
The second style (item 1054-003) is a nickel plated
brass Hercules supporting the globe with a black leather
base. In the Philippines, the wood is cut, solid wood and
MDF, a form of chipboard material commonly used in furniture
and cabinet production, are assembled to form a sub-base,
the wood is sanded, leather is inlaid, the brass component
is attached and the stand is polished according the
prescribed finish. The iron holder is then connected to the
globe and a hole is drilled and tapped between the shoulders
of the bronze figure and the globe holder and globe are
screwed into the hole. To fit the globe to the stand, a
wrench, drill and tap are used. the cost of the globe stand
is $167.37, the cost of the globe is $73.13, and the cost to
fit the globe to the stand is $6.75.
The third style (item 1354-006) is a globe on a steel
and brass stand. In the Philippines, the tubular steel and
flat iron components are cut, the metal is sanded and
polished, the metal components are assembled to form a
stand, and the stand is polished and lacquered according to
the finish. Brass rollers are then attached to the stand
and the globe is placed on the rollers. A wrench, drill and
tap are used to fit the globe to the stand. The cost of the
globe stand is $165.76, the cost of the globe is $73.13, and
the cost to fit the globe to the stand is $6.44.
The finished globes in the stands will bear a label
"Made in the Philippines" which is placed on the bottom side
of the top rim of the stand. You state that this method of
marking is necessary to protect the surface of the stand.
You asked about four other styles of stands in your
letter of January 19, 1998, but did not provide any details
on the processing of these styles. Therefore, we are unable
to address these styles in this ruling letter.
ISSUES:
What is the country of origin of the three styles of
globes attached to the stands?
Whether the proposed placement of the marking satisfies
the requirements of 19 U.S.C. 1304.
LAW AND ANALYSIS:
Section 304 of the Tariff Act of 1930 (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.
Part 134, Customs Regulations (19 CFR Part 134),
implements the country of origin marking requirements of 19
U.S.C. 1304. Pursuant to
19 CFR 134.1(b), "country of origin" means 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. A substantial transformation
results when a new and different article emerges from the
processing having a distinctive name, character or use.
U.S. v. Gibson-Thomsen Co., Inc., 27 CCPA 269 (1940).
In determining whether the combining of parts or
materials constitutes a substantial transformation, the
issue is the extent of operations performed and whether the
parts lose their identity and become an integral part of the
new article. Belcrest Linens v. United States, 573 F. Supp.
1149 (CIT 1983), aff'd, 741 F.2d 1368 (Fed. Cir. 1984).
Assembly operations which are minimal or simple, as opposed
to complex or meaningful, will generally not result in a
substantial transformation. See C.S.D. 85-25. However, the
issue of whether a substantial transformation occurs is
determined on a case-by-case basis. Customs ruled in C.S.D.
80-111, dated September 24, 1979, that a ceiling fan
assembled in the U.S. in assembly line procedures was not
substantially transformed in the U.S. Customs considered
factors such as the nature of the assembly, the amount of
skilled labor and specialized equipment involved and the
cost of the assembly process.
In Headquarters Ruling Letter ("HRL") 950005, dated
January 9, 1992, Customs ruled that sledge hammer handles
made from U.S. origin blocks of green hickory wood were
substantially transformed in Canada. However, the finished
Chinese sledge hammer heads assembled onto the handles in
Canada were not substantially transformed. Customs noted
that the heads were completed articles which did not need
any further manufacturing. Customs concluded that the
sledge hammer head must be individually marked "Head made in
China" and the handle must be marked "Handle made in
Canada."
The globes, when imported into the Philippines, are
completed articles which do not need any further
manufacturing other than a simple assembly. Attaching the
globes to the stands in the Philippines is a minor assembly
operation that does not involve skilled labor or specialized
equipment. The minimal cost involved in assembling the
globes to the stands reflects the minor nature of the
processing. The globes clearly do not undergo a change in
name, character or use. Therefore, the globes are not
substantially transformed in the Philippines and the country
of origin of the globes remains the U.S. The country of
origin of the three styles of stands would be the
Philippines. Consistent with the decision in HRL 950005,
each stand must be marked to indicate that its country of
origin is the Philippines.
The second question presented is whether marking the
country of origin on the bottom side of the top rim of the
stand satisfies the requirements of 19 CFR 134.41. Section
134.41(b), Customs Regulations (19 CFR 134.41(b)), requires
that the marking be conspicuous enough that an ultimate
purchaser will be able to find the marking easily and read
it without strain. The degree of permanence of the marking
should be at least sufficient to insure that in any
reasonably foreseeable circumstance, the marking shall
remain on the article until it reaches the ultimate
purchaser unless it is deliberately removed. The marking
must survive normal distribution and store handling.
You cite several Customs rulings on the marking of
tables, chairs, and a piano which allow marking on the
underside of the furniture and the piano. The basis of
these rulings is that the consumer expects to find the
marking of furniture or a piano in that location just as a
consumer expects shirts to be marked at the neck. These
rulings considered various factors as general guidelines:
whether the marking would detract from the articles
appearance; whether the ultimate purchaser expects to find
the country of origin marking in a certain location; and
whether the method of marking is appropriate to the nature
of the article.
The articles in question are not classified as
furniture, and the ultimate purchaser does not have an
expectation that globe stands would be marked on the bottom
of the rim. Marking the underside of the rim of the stand
is not a location that would enable the ultimate purchaser
to find the marking easily or be able to read it without
strain. We find that a marking on a label or tag that will
survive normal distribution and which is located where an
ultimate purchaser could find it easily would satisfy the
requirements of 19 CFR 134.41. To avoid any confusion
regarding the separate origins of the globe and the stand,
the stand must be marked "Stand made in the Philippines."
HOLDING:
The country of origin of the imported three styles of
stands is the Philippines. The stands must be marked "Stand
made in the Philippines."
The country of origin marking on the stands should not
be placed on the underside of the rim; it must be located
where it may easily be found by the ultimate purchaser.
The globes are not substantially transformed in the
Philippines. The country of origin of the globes remains
the U.S.
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