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NY C84368

March 9, 1998

MAR-2 RR:NC:MM:109 C84368


Ms. Susan Loades
Aloyd Forwarding Company, Inc.
149-09 183rd Street
Springfield Gardens, New York 11413


Dear Ms. Loades:

This is in response to your letter dated February 9, 1998, requesting a ruling on whether imported circuit boards are required to be individually marked with the country of origin if it is later to be processed in the U.S. by a U.S. manufacturer. An unmarked sample was submitted with your letter for review.

The merchandise is electronic circuit boards. These circuit boards are for use in Electronic Guitar Effect Processors and Guitar Amplifiers. Tech 21 purchases electronic components here in the United States and in Asia and ships them to an electronic assembly company in Hungary where they are machine populated on to printed circuit board material provided by the same electronic assembly company for Tech 21. The resulting unfinished circuit boards are then sent from Hungary to Tech 21 in the U.S. These unfinished circuit boards are further assembled in the United States together with input/output jacks, switches,potentiometers, heat sinks, AC power transformers, and power cord, LED's, ICs and other electronic components. The resulting "complete" circuit board is then permanently enclosed in a painted metal chassis that provides structural protection and electromagnetic shielding for the internal electronics. At this point the Guitar Effect Processors are essentially finished, however, the Guitar Amplifier assemblies then undergo one further step in which the metal chassis is installed in a vinyl covered wooden cabinet, together with a speaker, reverb tank and wiring. At this point, the Guitar Amplifiers are completed. The only remaining steps are to bench test and clean and package them for sale. In the finished product no part of the circuit board is in any way visible.

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. Section 134.41(b), Customs Regulations (19 CFR 134.41(b)), mandates that the ultimate purchaser in the U.S. must be able to find the marking easily and read it without strain. Section 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. 19 CFR 134.1(d)(1) states that if an imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported article to a process which results in a substantial transformation of the article. The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that an article used in manufacture which results in an article having a name, character or use differing from that of the constituent article will be considered substantially transformed and that the manufacturer or processor will be considered the ultimate purchaser of the constituent materials. In such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked. See, 19 CFR 134.35.

Articles to be processed in the U.S. by the importer or for his account otherwise than for the purpose of concealing the origin of such articles and in such manner that any mark contemplated by this section would necessarily be obliterated, destroyed or permanently concealed are excepted from marking under 19 CFR 134.32(g). The containers in which these articles are imported are excepted from marking as provided in 19 CFR 134.22(e). In this case, the imported circuit boards are substantially transformed as a result of the U.S. processing, and therefore the U.S. manufacturer is the ultimate purchaser of the imported circuit boards. We are of the opinion that the circuit boards subjected to the finishing process that you have described may be excepted from marking under 19 CFR 134.32(g) if the importer demonstrates to the satisfaction of the District Director that the requirements of these provisions are satisfied. In such event, their containers would be excepted from marking pursuant to 19 CFR 134.22(e) at the time of importation.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Eileen Kaplan at 212-466-5673.


Robert B. Swierupski

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