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NY G83159

November 9, 2000

CLA-2-95:RR:NC:SP:225 G83159


TARIFF NO.: 9502.10.0060

Mr. Donald S. Stein
Manatt, Phelps & Phillips, LLP
1501 M Street N.W., Suite 700
Washington, D.C. 20005-1702

RE: The tariff classification and country of origin marking of doll pencil toppers from China

Dear Mr. Stein:

In your letter dated October 2, 2000, received in this office on October 11, 2000, you requested a tariff classification and country of origin marking ruling on behalf of BIC U.S.A., Inc.

The product is described as plastic pencil toppers that resemble an assortment of human, princess-like, characters. In addition to classification, you have also requested advice on the proper country of origin marking requirements for the toppers under two possible scenarios. According to your letter, the toppers will be made in China and shipped in bulk to the U.S. for placement on pencils of U.S. origin. In scenario #1, the toppers will be permanently affixed to the pencils here in the U.S. In scenario #2, the toppers will be pushed onto the pencils prior to sale but will be capable of easy removal by the child.


The applicable subheading for the human figure pencil toppers will be 9502.10.0060, Harmonized Tariff Schedule of the United States (HTS), which provides for dolls representing only human beings and parts and accessories thereof: whether or not dressed: other. The rate of duty will be free.


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.

With regard to the permanency of a marking, section 134.41(a), Customs Regulations (19 CFR 134.41(a)), provides that as a general rule marking requirements are best met by marking worked into the article at the time of manufacture. For example, it is suggested that the country of origin on metal articles be die sunk, molded in, or etched. However, section 134.44, Customs Regulations (19 CFR 134.44), generally provides that any marking that is sufficiently permanent so that it will remain on the article until it reaches the ultimate purchaser unless deliberately removed is acceptable.

As provided in section 134.41(b), Customs Regulations (19 CFR 134.41(b)), the country of origin marking is considered conspicuous if the ultimate purchaser in the U.S. is able to find the marking easily and read it without strain.

You have cited four exceptions to the marking regulations that you believe could apply to the instant merchandise. Those exceptions include: 19 CFR 134.32(c) “articles that cannot be marked prior to shipment to the United States except at an expense economically prohibitive of its importation”, 134.32(d) “articles for which the marking of the containers will reasonably indicate the origin of the articles,” 134.32(f) “articles imported for use by the importer and not intended for sale in their imported or any other form” and 134.32(h) “articles for which the ultimate purchaser must necessarily know . . . .the country of origin by reason of the circumstances of their importation . . . even though they are not marked to indicate their origin.”

In regards to the first exception noted, there has been no evidence submitted to this office that would indicate a financial hardship to the company to mark the toppers with the country of origin. An exception under 134.32(c) is not justified (See HQ 558994).

It was suggested that marking the outer cartons in which the toppers will be shipped is sufficient to inform the ultimate purchaser of the country of origin pursuant to 134.32(d) and 134.32(h). The term "ultimate purchaser" is defined in section 134.1(d) in the Code of Federal Regulations (19 C.F.R. 134.1(D), as "generally the last person in the United States who will receive the article in the form in which it was imported. It is not feasible to state who will be the 'ultimate purchaser' in every circumstance. The following examples may be helpful:

(1) 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, even though the process may not result in a new or different article.

(2) If the manufacturing process is merely a minor one which leaves the identity of the imported article intact, the consumer or user of the article, who obtains the article after processing, will be regarded as the "ultimate purchaser."

(3) If the article is to be sold at retail in its imported form, the purchaser at retail is the "ultimate purchaser."

(4) If the imported article is distributed as a gift the recipient is the "ultimate purchaser"."

It is your contention that the “ultimate purchaser” of the toppers is your client, BIC U.S.A. Inc. You base this belief on the assumption that the process of assembling toppers onto pencils in the U.S. is a substantial transformation process. However, in order for a substantial transformation to exist, the imported article must undergo a significant alteration. Since merely placing the toppers on the pencils does not change their identity, the toppers are not transformed. If, however, the toppers were permanently affixed to the pencils, thereby losing their separate identity and potential for use in a separate activity, then a substantial transformation would exist.

Therefore, in scenario #1, where the toppers will be permanently affixed onto the pencils, this office would agree that a substantial transformation takes place making BIC U.S.A. Inc. the ultimate purchaser of the toppers. Pursuant to 19 C.F.R. §134.32(d) of the Customs Regulations, it is at the discretion of the port director to authorize an exception to the marking requirements. You are advised to contact the Customs office at the port of entry, prior to the importation of the merchandise, for specific guidance in applying for an exception to the marking statute.

With regards to scenario #2, where the toppers are merely pushed onto the pencils, we have reached a different conclusion. In this instance, the toppers retain their identity as toppers and, since they are removable, will have lasting appeal as a doll-like character long after the pencil is depleted. Here, we find the ultimate purchaser is not BIC U.S.A. Inc., but rather is the customer in a retail store. This office finds that the toppers, in scenario #2, must be individually marked with the country of origin to reflect “Made in China.”

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 Alice J. Wong at 212-637-7028.


Robert B. Swierupski

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