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HQ 732582

February 12, 1990

MAR-2-05 CO:R:C:V 732582 KG

CATEGORY: MARKING

Mr. John H. Heinrich
District Director
Los Angeles, California

RE: Country of origin marking of imported worsted flannel fabric

Dear Mr. Heinrich:

This is in response to your memorandum of June 30, 1989, requesting internal advice (MAR-2-06 LA:C:TTBIII) concerning the country of origin marking of imported worsted flannel fabric. A conference was held at Customs Headquarters on January 24, 1990, with counsel and Mr. Lieu, the importer, at their request to discuss this matter.

FACTS:

This ruling involves a 1987 shipment of imported fabric for which the Los Angeles Customs office issued a notice to the importer citing a country of origin marking violation. The notice indicated that the importer could export the fabric, obliterate the selvedge by cutting or stamp in indelible ink "Made in China" along the full length of the selvedge. The fabric was the subject of warehouse entry #989-0003265-1 and is currently being warehoused in bond.

The worsted wool fabric is imported from China. The marking "Huddlesfield" is woven into the full length of the selvages. Only the first yard of the fabric is marked "Made in China." When the roll is taken out of the carton and the first yard of fabric is removed, the only marking remaining is "Huddlesfield worsted flannel specially woven for J. Johnson Ltd." woven along the full length of the fabric on both sides. The rolls are in lengths of up to 70 yards.

The importer states that in addition to marking the first yard of the fabric itself, the packaging of the fabric is marked with the country of origin with: (1) a hangtag attached to the end of each bolt of material; (2) a label on the side of the bolt; and (3) a marking on the shipping crate.

Although the importer maintains that he imports the fabric exclusively for sale only to clothing manufacturers, a Customs investigation determined that in the past, fabric brought in by this importer was also being sold by retailers. The importer also contends that "Huddersfield" is a type of weave in addition to being a place in England.

ISSUE:

Whether the imported worsted flannel fabric satisfies the country of origin marking requirements of section 304 of the Tariff Act of 1930, as amended.

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. The Court of International Trade stated in Koru North America v. United States, 701 F.Supp. 229, 12 CIT (CIT 1988), that: "In ascertaining what constitutes the country of origin under the marking statute, a court must look at the sense in which the term is used in the statute, giving reference to the purpose of the particular legislation involved. The purpose of the marking statute is outlined in United States v. Friedlaender & Co., 27 CCPA 297, 302 C.A.D. 104 (1940), where the court stated that: "Congress intended 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."

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(d), Customs Regulations (19 CFR 134.1(d)), defines the ultimate purchaser as generally the last person in the U.S. who will receive the article in the form in which it was imported. A Customs investigation concluded that retail fabric stores were offering fabric brought in by this importer for sale. In such circumstances, the retail consumer purchasing fabric in a fabric store would be considered the ultimate purchaser of the goods. Therefore, the imported fabric must be properly marked with the country of origin so as to inform the retail consumer that the imported fabric came from China.

Section 134.46, Customs Regulations (19 CFR 134.46), requires that when the name of any city or locality in the U.S., other than the name of 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 of the actual origin of the imported goods.

In this case the marking on the selvage could easily mislead or deceive the ultimate purchaser into believing that the fabric originates from England. The word "Huddlesfield" is strikingly similar to the word "Huddersfield", a town in Northern England noted for the manufacture of worsteds. Because the fabric is prominently marked with the word "Huddlesfield", a word that is strikingly similar to the name of a locality other than the country of origin, 19 CFR 134.46 requires that the country of origin be marked legibly, permanently, in comparable size and in close proximity in any case where the word "Huddlesfield" appears on the fabric. This is necessary to inform the ultimate purchaser that the fabric is from China and not Huddersfield, England.

Section 134.35, Customs Regulations (19 CFR 134.35), provides that in cases where a manufacturer in the U.S. substantially transforms the imported article into a new or different article, the manufacturer is considered the ultimate purchaser and only the outermost container of the imported article must be marked with the country of origin. A U.S. manufacturer of finished clothing such as a suit manufacturer who purchased this cloth directly from the importer and finished it into a suit would probably be considered the ultimate purchaser of this fabric.

However, 19 CFR 134.36(b) provides that an exception from marking shall not apply to any article or retail container bearing any words, letters, names, or symbols described in 19 CFR 134.46 or 19 CFR 134.47 which imply that an article was made or produced in a country other than the actual country of origin. Consequently, even if the manufacturer were considered the ultimate purchaser of this fabric, because the word "Huddlesfield" across the selvage implies that the fabric is made in a country other than China, the 19 CFR 134.35 exception would not apply. Fabric which contains the markings described above must be marked with the country of origin everywhere the word "Huddersfield" appears, even if destined for a clothing manufacturer.

HOLDING:

Because the fabric is prominently marked with the word "Huddlesfield", a word that is strikingly similar to the name of a locality other than the country of origin, 19 CFR 134.46 requires that the country of origin be marked legibly, permanently, in comparable size and in close proximity in all places where the word "Huddlesfield" appears on the fabric. Pursuant to 19 CFR 134.36(b), this requirement applies even where the ultimate purchaser is a clothing manufacturer.

Sincerely,

Marvin M. Amernick
Chief, Value, Special Programs

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