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NY R01170




December 16, 2004

MAR-2 RR:NC:N3:351 R01170

CATEGORY: MARKING

Connie Wilson
Transportation Dept.
The Longaberger Company
Building F
5563 Raiders Road
Frazyesburg, OH 43822

RE: COUNTRY OF ORIGIN MARKING OF IMPORTED BASKET LINERS

Dear Ms. Wilson:

This is in response to your email dated Dec. 10, 2004, requesting a ruling on whether imported textile basket liners are required to be individually marked with the country of origin if they are to be sold in the U.S. after being placed in baskets. A marked sample was not submitted with your letter for review, but photographs were. The classification of the basket liners was ruled on in ruling L80188, wherein this office classified them in subheading 6307.90.9889, Harmonized Tariff Schedule of the United States Annotated (HTS), which provides for other made up textile articles, other.

The manufacturing operations for the liners are as follows, as stated in your earlier letter: 100% cotton or 90% cotton/10% rayon woven fabric is sent to Nicaragua where the liners are cut and sewn and other finishing processes, such as adding buttons and button holes, are performed to complete the liners. It appears from your letter that the fabric is currently of U.S. origin but that in the future it will be of Chinese origin.

In ruling L80188, we determined that the country of origin of the basket liners made from Chinese fabric is China and must be marked to so indicate. The country of origin of the basket liners made from U.S. fabric is Nicaragua and likewise must be so marked.

You now state that the basket liners will be shipped to stores where they will be sold separately or placed in baskets and sold as a unit. You now wish to know whether the country of origin label, as shown in the photographs you have supplied, is sufficient.

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.

In this case, the imported basket liners that are placed into the baskets by the store prior to sale are substantially transformed as a result of the U.S. processing, that is, being placed into the baskets, and therefore the U.S. store is the ultimate purchaser of the imported basket liners and under 19 CFR 134.35 only the containers which reach the ultimate purchaser (the store) are required to be marked with the country of origin, either China or Nicaragua.

However, those basket liners that will be sold separately fall within the marking statute, Section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304) and must 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.

The label in the photograph states, “Made exclusively for Longaberger in Nicaragua.” It is sewn into a seam. Thus, it meets the requirements that it be legible, indelible and permanent; however, this information is on the back of the label and thus must be turned over by the prospective purchaser to be seen. This is unacceptable. If imported in this condition, the shipment would be considered to be not legally marked.

Also please note that the label that indicates the origin is Nicaragua is only applicable when the fabric is of U.S. origin. If the fabric is of Chinese origin, the label must indicate that the country of origin of the basket liner is China, not Nicaragua.

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 Mitchel Bayer at 646-733-3102.

Sincerely,

Robert B. Swierupski
Director,

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