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NY D84005

November 18, 1998

MAR-2 RR:NC:SP:221 D84005


Mr. Peter Perthou
Light Fantastic, Inc.
P.O. Box 127
Rockport, MA 01966-0127


Dear Mr. Perthou:

This is in response to your letter dated October 13, 1998, requesting a ruling on whether imported swivel snap hooks are required to be individually marked with the country of origin if they are later processed in the U.S. by a U.S. manufacturer.

The imported product consists of a plastic swivel-eye bolt snap from Taiwan. After importation a strip of leather will be threaded through the bottom eye of the bolt snap and through the center of a metal split ring, and then riveted to itself, resulting in a swivel bolt key ring. You indicate that the leather strip and the split ring are manufactured in the United States.

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. For tariff purposes, the courts have held that a substantial transformation occurs if a new and different article emerges having a distinctive name, character or use. Anheuser-Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982). In determining whether the combining of parts or components 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, 6 CIT 204, 573 F.Supp. 1149 (1983), aff'd, 2 Fed. Cir. 105, 741 F.2d 1368 (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 (September 25, 1984).

In determining whether the bolt snap is sufficiently transformed in the United States by virtue of its being combined with the leather strip and split ring, we note that the process of attaching the components is not complex. The bolt snap remains visible after the combining, does not lose its identity after the combining, and is functionally necessary to the operation of the finished article. Accordingly, the bolt snap is not substantially transformed when it is combined with the other components, and the ultimate purchaser of the snap bolt is the purchaser of the snap bolt key ring. The finished article must be marked to indicate the country of origin of the snap bolt. Because the bolt is combined with other components before delivery to the ultimate purchaser, the product must be marked in a manner which clearly shows that the origin indicated, i.e., Taiwan, is that of the swivel eye snap bolt alone.

In the alternative, you have requested a ruling on whether it is acceptable to mark the container in which the snap bolt key ring is repackaged in the U.S. with the country of origin in lieu of marking the snap bolt itself when no other markings appear on the snap bolt. A marked sample container was not submitted with your letter for review.

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. However, since the products are not imported in their marked retail containers, whether the imported bolts are excepted from individual marking under 19 CFR 134.32(d) is for the port director to decide. In this regard section 134.34, Customs Regulations (19 CFR 134.34), provides that an exception may be authorized in the discretion of the port director under 19 CFR 134.32(d) for imported articles which are to be repacked after release from Customs custody under the following conditions: (1) The containers in which the articles are repacked will indicate the origin of the articles to an ultimate purchaser in the U.S.; (2) The importer arranges for supervision of the marking of the containers by Customs officers at the importer's expense or secures such verification, as may be necessary, by certification and the submission of a sample or otherwise, of the marking prior to the liquidation of the entry.

In this case, assuming that the port director is satisfied that the completed key ring with attached snap bolt will be repacked in the manner described above, and that the other conditions set forth in 19 CFR 134.34 are met, the port director may authorize an exception under 19 CFR 134.32(d), in which case marking of the imported swivel eye snap bolts will not be required.

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 Joan Mazzola at 212-466-5580.


Robert B. Swierupski

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