MAR-05: RR:CR:SM 562156 BLS
David M. Murphy, Esq.
Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP
245 Park Avenue
33rd Floor
New York, New York 10167-3397
RE: Reconsideration of 65NY G88114; country of origin marking of woman’s
handbag
Dear Mr. Murphy:
This is in reference to your letter dated June 11, 2001, on behalf of Dooney and Burke, Inc., requesting reconsideration of 65NY G88114 dated May 7, 2001, concerning the country of origin marking of a woman’s handbag. Although 65NY G88114 also concerned the tariff classification of the handbag, your request covers only the country of origin marking issue. A sample was submitted with your request.
FACTS:
The sample submitted is a feedbag style handbag and measures approximately 10” high by 10.5” wide at the top. The bag body is manufactured of top grain leather that is coated or covered on the grain surface with plastics. The exterior surface is then embossed with small yellow dots simulating an exotic grain. The interior is unlined and has one hanging pocket. The top center is closed by means of a gold tone tuck lock. A fabric label will be sewn into the inner side seam approximately 1 ½” from the top. The label will illustrate the American, Italian and Chinese national flags. Beneath each appropriate flag will appear the words “american design”, “italian leather” and “chinese crafting”, in 3-point size type1 and in that order. The coated leather is fabricated in Italy and then shipped to China where it is made into handbag components by cutting to shape. The bag is then assembled in China by combining the leather components with Chinese fabricated handles, trim and hardware.
ISSUE:
What are the country of origin marking requirements for the sample handbag?
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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 purchased, 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).
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)), defines "country of origin" as the country of manufacture, production or growth of any article of foreign origin entering the U.S. 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 the marking laws and regulations.
A substantial transformation occurs when articles lose their identity and become new articles having a new name, character, or use. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 at 270 (1940).
Customs has previously held that cutting materials to defined shapes or patterns suitable for use in the assembly of a finished article, as opposed to mere cutting to length and/or width, which does not render the article suitable for a particular use, constitutes a substantial transformation. See, e.g., Headquarters Ruling Letter (HRL) 734539 dated June 8, 1992 (cutting to shape of materials to form components of men’s wallets and lady’s clutches); and HRL 055588 dated September 15, 1978 (cutting of leather into parts for a belt). In this case, the coated leather undergoes a substantial transformation as a result of cutting to shape to form the handbag components and assembling the components into the finished article. Therefore, the country of origin of the handbags is China.
Section 134.46, Customs Regulations (19 CFR §134.46), provides, in part, that when the name of a city or locality in the United States or the name of any foreign
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country or locality other than the country or locality in which the article was manufactured or produced, appears on an imported article or its container, and those
words, letters, or names may mislead or deceive the ultimate purchaser as to the actual country of origin of the article, 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.
In this case, the special marking requirements of 19 CFR 134.46 are triggered as a result of the references on the fabric label to “american design” and “italian leather”, as China is the country of origin.
GSNY G88114
In GSNY G88114 dated May 7, 2001, Customs held that neither the words “Chinese crafting” nor “Assembled in China” on the label would satisfy 19 CFR 134.46. We suggested that the handbags be marked “Made in China.” We also stated that the size of the marking, 3 points, was not conspicuous and thus would not comply with the requirements of 19 U.S.C. 1304.
Section 134.43(e), Customs Regulations (19 CFR 134.43(e)), provides generally that where an article is produced as a result of an assembly operation and the country of origin of such article is determined to be the country in which the article was finally assembled, such article may be marked, as appropriate, in a manner such as the following:
(1) Assembled in (country of final assembly);
(2) Assembled in (country of final assembly) from components of
(name of country or countries of origin of all components); or
(3) Made in, or product of, (country of final assembly).
As China is the country of origin and where the handbag is assembled, we find that the words “Assembled in China” as located on the fabric label of the sample handbag would be an acceptable marking. We also find that the words “chinese crafting” may be confusing to an ultimate purchaser, particularly as it appears in relation to the markings “american design” and “italian leather.” However, the words “Crafted in China” would also be an acceptable marking, as an ultimate purchaser would
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understand that this phrase refers to the country where an item was made. See HRL 732689 dated December 7, 1989.
You also believe that the 3-point size marking on the fabric label is conspicuous and legible, and that accordingly, Customs should reconsider its prior determination that such marking was of insufficient size.
In HRL 733146 dated September 19, 1991, we considered a 3-point size marking on the back of a greeting card to be conspicuous. However, we also stated that such 3-point type size marking “…presumes that the country of origin information is not buried among additional information such that it is difficult to find….” In this case, as the fabric label which includes the country of origin marking is located inside the bag on the inner side seam, we find that an ultimate purchaser may have difficulty in reading the 3-point size of this marking, particularly as such marking is located below the markings “american design” and “italian leather.” HRL 733146 is thereby distinguished. However, we find that your proposal to increase the type size of the marking from 3 points to 6 points, as reflected on your submitted exhibit, is acceptable, as we find such size marking to be conspicuous and legible, in compliance with 19 U.S.C. 1304.
HOLDING:
The words “chinese crafting” on the fabric label sewn into the inner side seam of the sample handbag will not satisfy the requirements of 19 CFR 134.46 as such marking when viewed with the words “american design” and "italian leather” may confuse the ultimate purchaser as to the country of origin of the handbags. The proposed words “Assembled in China” or “Crafted in China” are acceptable markings which will satisfy 19 CFR 134.46 and 19 U.S.C. 1304, provided the size of such markings is at least in 6-point type. 65NY G88114 is modified in accordance with this determination.
A copy of this ruling 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