MAR-05 RR:TC:SM 560322 BLS
Port Director
Seattle, Washington 98174
RE: Country of origin marking of crab reprocessed in the U.S.;
substantial
transformation; HRL 732939
Dear Sir:
This is in reference to a letter dated February 11, 1997,
from the Tyson Seafood Group (Tyson), requesting a ruling
concerning the country of origin marking requirements for
foreign-origin Opilio crabmeat repacked in the U.S. The product
is currently being entered through the port of Seattle.
FACTS:
Tyson states that Alaskan and Russian caught Opilio crab are
packed in bulk and entered into the U.S. in master cartons. In
the U.S., the following operations are performed;
1) The crab is removed and separated into individual
clusters.
2) Marine growth, gills and gurry that are not removed
during primary processing
are removed by scraping with a knife or cutting with a
saw.
3) Product is glazed with ice to protect it from dehydration
during frozen
storage.
4) Product that is unusable in cluster packs is removed.
This includes crab with bluing, broken crab,
bodies without legs, walking legs, loose claws and
individual legs. These products are packed for sale in
this form, or held for
processing at a later date.
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5) Product is sorted by size and color and packaged
accordingly. (Legs and claws that are removed
during processing are scored with a saw and custom packed
for various customers.)
ISSUE:
What are the country of origin marking requirements for the
reprocessed crab?
LAW AND ANALYSIS:
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), requires that, unless excepted, every article of foreign
origin, or its container, must be legibly, permanently, and
conspicuously marked to indicate the country of origin to an
ultimate purchaser in the U.S. The primary purpose of the
country of origin marking statute 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 requirements and exceptions to 19 U.S.C. 1304. Under 19 CFR
134.1(d), the ultimate purchaser is defined as the last person in
the U.S. who will receive the article in the form in which it was
imported. If an imported article is further manufactured in the
U.S. and the manufacturing process is merely a minor one which
leaves the identity of the imported article intact, pursuant to
19 CFR 134.1(d)(2), the consumer or user of the article who
obtains the article after the processing, will be regarded as the
ultimate purchaser.
Foreign natural products such as animals, fish and birds in
their natural state or not advanced in any manner further than is
necessary for their safe transportation are on the so-called
"J-list" and are excepted from individual marking requirements
pursuant to 19 U.S.C. 1304(a)(3)(J) and 19 CFR 134.33. However,
the outermost container in which the article ordinarily reaches
the ultimate purchaser is required to be marked to indicate the
origin of its contents. As provided in 19 CFR 134.25, if the
imported J-list product will be repacked prior to sale to the
ultimate purchaser, the importer must certify to Customs that he
will properly mark the new package or alternatively, notify the
repacker of the obligation to mark the new package. The
certification procedures, which are for the purpose of ensuring
that the ultimate
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purchaser will be advised of the country of origin, apply to
imported J-list articles processed and repacked after importation
unless the articles are substantially transformed prior to
repacking. Absent a substantial transformation, the consumer or
other recipient of the crab product is considered the ultimate
purchaser and must be advised of its country of origin through
marking of the outermost container, and the importer must comply
with the certification and notification requirements of 19 CFR
134.25.
Whether a substantial transformation has occurred depends
upon a comparison of the article before the processing which is
claimed to effect such transformation and the article after the
processing. It is a well-settled principle of Customs law that
in order for a substantial transformation to be found, an article
having a new name, character or use must emerge from the
processing. See United States v. Gibson-Thomsen Co. Inc., 27
C.C.P.A. 267, C.A.D. 98 (1940).
In Headquarters Ruling Letter (HRL) 732939 dated October 9,
1990, crab caught by U.S. flag vessels was processed aboard
either the U.S. flag catching vessels or Soviet flag processing
vessels by cleaning, cutting the legs from the body, boiling,
blast freezing and packaging. After importation, the crab was
sorted, graded, and repackaged in 20 pound cartons. In that
case, we found that the cleaning, cutting, boiling, blast
freezing and packing did not result in a change in the name,
character or use of the crab. We pointed out that such
processing of food was similar to the cutting, blanching,
packaging and freezing of broccoli (HRL 729365 dated June 2,
1985, published as C.S.D. 86-26); and the cooking, peeling,
deveining and freezing of shrimp (HRL 731763, May 17, 1989).
Therefore, we held that such processing aboard the Soviet vessels
did not result in a substantial transformation. (See also HRL
732337 dated August 16, 1989, where Customs ruled that the
domestic processing of imported crab meat by thawing, sorting,
blending with domestic crab meat, canning and pasteurization did
not constitute a substantial transformation.)
In HRL 109504 dated August 12, 1988 (affirmed by HRL 109793
dated May 31, 1989), we considered the extent of processing crab
necessary to yield a new and different product under the
coastwise laws. In that case, after boiling, removal of the
backs, freezing and glazing on a U.S. flag processing vessel, the
crab were further processed on a Korean flag vessel by thawing
and cleaning; removing the gurry and gills; grading the arms,
legs and claws, and in some cases, by scoring the shells. In
other cases, the shells were largely removed, and finally, in
some cases the meat was
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entirely removed from the shells. In HRL 109504/109793, we ruled
that partially processed crab which was later fully processed
aboard the Korean flag vessel did not become a new and different
article of commerce to the extent the meat was not largely or
wholly removed from the shell. Although decided under the
coastwise laws rather than under the marking statute, the
ruling's conclusion as to whether the foreign processing effected
a substantial transformation is consistent with decisions
involving the determination of a change in name, character and
use under the marking laws.
Under the circumstances, it is our opinion that the
processing in the U.S. of
Russian-origin crab in the manner described does not result in a
substantial transformation, and that accordingly, the outermost
containers in which the crab is repackaged after such processing
must be marked with Russia as the county of origin. Further, the
importer must also comply with the certification and notification
procedures of 19 CFR 134.25. Since the crab caught in Alaskan
waters is of U.S.-origin, this product is not subject to the
marking requirements.
HOLDING:
The processing in the U.S. of imported Russian-origin crab
by cleaning to remove marine growth, gills and gurry, glazing
with ice, and sorting by size and color, does not constitute a
substantial transformation. Accordingly, the repacked crab is
subject to the country of origin marking requirements of 19
U.S.C. 1304 and 19 CFR Part 134 and the importer must follow the
certification procedures of 19 CFR 134.25.
Since the crab caught in Alaskan waters is of U.S.-origin, it is
not subject to country of origin marking requirements.
Please provide a copy of this decision to Mr. Darrell Cran,
Quality Assurance Manager, Tyson Seafood Group, Pier 91, Bldg.
392, Box C-119, Seattle, Washington
98119.
Sincerely,
John Durant,
Director
Special
Classification and Marking Branch