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HQ 563123

December 29, 2004


MAR-05 RR:CR:SM 563123 KKV

Mr. Richard Gutting, Jr.
Reed Smith, LLP
1301 K Street, N.W.
Washington, DC 20005-3373

RE: Country of origin marking requirements and applicability of preferential tariff treatment for certain shrimp caught aboard U.S.-flag vessels; territorial sea; contiguous zone, Exclusive Economic Zone (EEZ); HRL 116241, HRL 732939

Dear Mr. Gutting:

This is in response to your letter dated May 19, 2004, and subsequent submittals dated September 10, 2004, November 22, 2004 and December 2, 2004, on behalf of Gulf King Services, Inc., which requests a binding ruling regarding the country of origin marking requirements applicable to imported shrimp harvested in Nicaraguan waters.


We are informed that Gulf King owns and operates a fleet of U.S.-flagged fishing vessels, documented under the laws of the United States, that harvest shrimp in the waters of Nicaragua. Gulf King proposes to land headed (without heads) shrimp in Nicaragua, where they will be packed and frozen and subsequently shipped to the United States. You indicate that none of the shrimp harvest by Gulf King vessels will be harvested from waters inside the territorial sea of Nicaragua and inquire whether the imported shrimp is a foreign article that must be marked as a product of Nicaragua.

In a related decision, Headquarters Ruling Letter (HRL) 116241, issued November 15, 2004, Customs and Border Protection (CBP) determined that the subject shrimp are classifiable under subheading 9815.00.20, HTSUS, and entitled to duty-free entry upon importation into the U.S. as products of an American fishery.


Whether shrimp harvested by U.S.-flagged vessels in Nicaraguan waters outside the territorial sea are excepted from the country of origin marking requirements of 19 U.S.C. 1304


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 United States 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 United States the English name of the country of origin of the article. By enacting 19 U.S.C. 1304, Congress intended to ensure that the ultimate purchaser would be able to know by inspecting the marking on the imported goods the country of which the goods are 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. United States v. Friedlaender & Co., 27 C.C.P.A. 297, 302 C.A.D. 104 (1940).

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Pursuant to 19 CFR 134.32(k), products of American fisheries which are free of duty are excepted from individual marking; however, 19 CFR 134.22(a) states that when an article is excepted from the marking requirements by subpart D, the outermost container or holder in which the article ordinarily reaches the ultimate purchaser shall be marked to indicate the country of origin of the article whether or not the article itself is marked to indicate its country of origin. Therefore, while the individual articles are excepted from marking pursuant to 19 CFR 134.32(k), as products of American fisheries (as determined in HRL 116241), it is necessary to determine the origin of the shrimp for purposes of marking the outermost container.

Section 134.1(b) of the Customs Regulations (19 CFR 134.1(b) defines “country of origin” as:

The country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin" within the meaning of this part; however for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin.

With regard to the country of origin of fish and seafood products, the court’s decision in Koru North America v. United States, 701 F.Supp. 229 (CIT) is instructive. In that case, fish were caught within New Zealand’s Exclusive Economic Zone (EEZ) by vessels flying the flags of New Zealand, Japan and the former Soviet Union. The court reaffirmed the special rule of origin applicable to fish which provides that on the high seas, the country of origin of fish is determined by the flag of the catching vessel. See, Procter & Gamble Mfg. v. United States, T.D. 45099 (1931), aff’d, 19 CCPA 415, C.A.D. 3488, cert. denied, 287 U.S. 629 (1932). In Koru, the court further determined that the fact that the fish were caught in the EEZ of New Zealand did not affect the applicability of this rule for purposes of country of origin marking. A nation enjoying preferential fishing and other rights within its EEZ does not, under the United Nations Convention on the Law of the Sea (UNCLOS), enjoy full sovereign territorial rights within its Zone. The court stated that “certain elements of the high seas are retained in an EEZ.” 701 F. Supp. 232. Therefore, “it would be improper to characterize fish caught within a country’s EEZ as originating within that country on the basis of their being caught within the EEZ.” id.

With regard to the shrimping operation under consideration, we are advised that Nicaragua has ratified the UNCLOS, which provides for territorial seas to extend twelve nautical miles seaward from its baseline. Further, Nicaragua has established a “contiguous Zone” that extends 24 miles from its baseline, and an EEZ that extends 200 miles from its baseline. We are informed by counsel that none of the shrimp imported by Gulf King vessels will be harvested within the territorial sea of Nicaragua. Based upon the holding in Koru, supra, it is Customs position that shrimp harvested outside the territorial sea of Nicaragua but within its EEZ, will be a product of the U.S., the country where the harvesting vessel is documented. See also, HRL 732939, dated October 9, 1990.

Subsequent to harvest, the headed shrimp (without heads) are landed in Nicaragua where they are frozen and packed into containers. With regard to the subject merchandise, CBP previously held that such operations “would not result in any advance or change in the condition of the shrimp, and would merely be incidental to their safe and marketable transshipment to the U.S.” See, HRL 116241, dated November 15, 2004. While this decision was issued in connection with the classification of the goods as products of an American fishery and not in connection with the marking statute, the ruling’s conclusion as to the extent of processing regarding its insufficiency to yield a new and different product is consistent with our own view that such processing is insufficient to substantially transform the shrimp into a product of Nicaragua. Therefore, inasmuch as the shrimp are not substantially transformed into an article of foreign origin by virtue of processing operations in Nicaragua, the outermost containers of the subject shrimp are not subject to the provisions of 19 U.S.C. 1304 upon importation into the United States.

We note that the Federal Trade Commission (“FTC”) has jurisdiction concerning the use of the phrase "Made in the U.S.A.," or similar words denoting U.S. origin. Consequently, any inquiries regarding the use of such phrases reflecting U.S. origin should be directed to Steven Ecklund at the FTC, at the following address: Federal Trade Commission, 6th & Pennsylvania Avenue, N.W., Washington, D.C. 20508 or by telephone at (202) 326-2841.

For information regarding the applicability of labeling laws pertaining to seafood products, please contact the U.S. Department of Agriculture at 1400 Independence Ave., S.W. Washington, DC 20250.


Based upon the information provided, shrimp harvested by U.S.-flag vessels outside the territorial sea of Nicaragua is not a product of Nicaragua for country of origin marking purposes. Further, headed shrimp which are frozen and packaged for shipment are not substantially transformed into an article of foreign origin by virtue of processing operations in Nicaragua. Therefore, the outermost containers of the subject shrimp are not subject to the provisions of 19 U.S.C. 1304 upon importation into the United States.

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.


Myles B. Harmon

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