MAR-02 RR:CR:SM 560791 RSD
Richard A. Walawender, Esq.
Miller, Canfield, Paddock and Stone, P.L.C.
150 West Jefferson, Suite 2500
Detroit, Michigan 48226
RE: Country of origin marking of imported bicycle chain;
special marking for chain; marking exception for marking
the containers; trademarks; 19 CFR 134.32(d);
19 CFR 134.46; 19 CFR 134.47
Dear Mr. Walawender:
This is in response to your letter dated October 30, 1997,
on behalf of Globe Expo L.L.C. (Globe Expo) concerning the
country of origin marking of bicycle chain imported from Poland.
Globe Expo sent a sample of a link of bicycle chain and a box
(with proposed marking thereon) in which the bicycle chain will
be sold at the retail level. Subsequently, after consultation
with this office, Globe Expo sent a copy of a letter with a
mockup showing how they intend to alter the country of origin
marking on the retail box. We have also received by facsimile a
copy of Globe Expo's application for registration of a trademark
with the United States Patent and Trademark Office.
FACTS:
Globe Expo is a Michigan limited liability company which
intends to enter into a distribution agreement with a Polish
bicycle chain manufacturer. The company will import the bicycle
chain and act as the distributor or sales agent for the bicycle
chain in the United States. Globe Expo's trademark will be
imprinted on every other link of the bicycle chain. The
trademark consists of an oval with the letters "KAZ" printed in
bold to encompass the entire space of the oval. As part of the
trademark, at the bottom of the letters KAZ, breaking the
perimeter line of the oval, the small letters "U.S.A." are
printed. Nothing else will be printed on the linkage except for
a small imprint of the date of production every 12 inches.
Globe Expo proposes to market and sell the bicycle chain in
three ways. The first method of selling the chain would be at
wholesale to distributors and manufacturers of bicycles. When
the chain is sold to distributors and manufacturers, the chain
would be shipped in bulk on large spools. It is presumed that
purchasers of chain through this method will use it as original
equipment when they manufacture bicycles. The top of each spool
would be prominently marked by a sticker applied to the spool
which indicates that the chain is made in Poland. The second
method of selling the chain would be at wholesale to retailers of
bicycle parts and supplies. In this method, the chain would be
individually packaged in small boxes. Each box would be marked
"Made in Poland". The third method of selling the chain would
involve direct marketing or retail sales. The chain would be
offered for sale either on a wholesale or retail basis through
advertisements in trade publications. The advertisements
themselves would not contain any indication regarding the country
of origin of the chain. When the chain is shipped/imported; it
would be marked with the country of origin as described above;
that is, either marked on the spools if sold in bulk or on each
individual box if sold as individual units.
The original sample of the retail box has only one country
of origin marking on a side panel, which reads "Made in Poland"
below the phrase "U.S.A. Enhanced". The front panel of the box
has a large replica of the Globe Expo's trademark oval "KAZ
U.S.A." printed on it. The box's back panel indicates that
Globe Expo's warehouse and distribution center is located in
Troy, Michigan. Another side panel has the sentence "THE COMPANY
OPERATES UNDER ISO - 9001 STANDARDS REGISTERED BY GERMAN DQS
STANDARD IN 1994" printed on it. Subsequently, Glob Expo revised
the country of origin marking on the retail box for the chain.
On the back panel of the revised box, which contains the Troy,
Michigan address of its warehouse, the company also added the
country of origin marking "MADE IN POLAND".
The company also presented copies of two stickers, one which
will be used for marking the box and the other for marking the
spools on which the chain will be shipped to bicycle
manufacturers. They will be glued onto two sides of the boxes
and onto two sides of the spools. The stickers for the boxes and
the spools are very similar in that both have the trademark "KAZ
U.S.A." oval printed on them. The stickers also indicate that
the chains are produced and imported by Globe Expo L.L.C. and
display the Troy, Michigan address. The country of origin of the
chains are shown on the stickers through the marking "COUNTRY OF
ORIGIN: MADE IN POLAND".
Your last submission indicates that an application for the
Registration of the "KAZ U.S.A." trademark was filed with the
United States Patent and Trade Office on February 17, 1998. The
application contained a drawing of the mark to be registered and
payment of the filing fee.
ISSUES:
Whether the special marking requirements for chain apply to
bicycle chain.
Whether the special marking requirements of 19 CFR 134.46 or
19 CFR 134.47 apply to the bicycle chain, and if so, whether the
requirements are satisfied by the proposed country of origin
marking on the boxes, spools, and stickers.
LAW AND ANALYSIS:
Section 304 of the 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 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 the
article. Part 134, Customs Regulations (19 CFR 134), implements
the country of origin marking requirements and exceptions of 19
U.S.C. 1304.
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,
C.A.D. 104 (1940).
The first issue that we must consider is whether the prior
rulings that Customs has issued pertaining to special marking
requirements for chain in general are applicable to the commodity
involved in this case--bicycle chain. Customs has previously
ruled that, under certain circumstances, chain is required to be
marked by some permanent means such as die-stamping or metal tags
attached to the chain at 6 to 10 foot intervals or less. See
Headquarters Ruling Letter (HRL) 721119, February 3, 1983. In
HRL 730615, August 20, 1987, Customs indicated that the following
are acceptable methods of marking chain:
1. If the chain is sold in the same condition as
imported, it is sufficient
to mark the chain at one end.
2. If the chain is to be cut to various lengths prior
to, or at the time of sale
to the ultimate purchaser, the marking must be
placed at intervals of
6 to 10 feet.
3. If the chain is to be cut to lengths less than 6 to
10 feet, each must be marked.
These methods must be used notwithstanding the fact that the
containers for the chain may also be marked with the chain's
origin.
After reviewing the rulings concerning the marking of chain,
we believe that the special marking requirements described above
should not be applied to bicycle chain. The apparent underlying
reason for the special marking requirements for most types of
chain is that there is a high probability that the country of
origin marking would be removed before it reached the ultimate
purchaser, especially in cases where the chain was to be cut to
length before purchase. We do not believe that this is the case
for bicycle chain because it is unlikely that it is going to be
cut to length before purchase. Because it appears that bicycle
chain is less likely than other
types of chains to have the country of origin marking removed
before it reaches the ultimate purchaser, we conclude that the
special marking requirements indicated in previous Customs
rulings for chain in general do not pertain to bicycle chain.
The next issue to be addressed is whether the special
marking requirements of 19 CFR 134.46 or 19 CFR 134.47 are
triggered by the trademark "KAZ U.S.A." embossed onto the bicycle
chains. In cases where there is a reference to a location other
than the country of origin on imported merchandise, the special
marking requirements set forth in sections 134.46 and 134.47,
Customs Regulations (19 CFR 134.46 and 19 CFR 134.47), may be
applicable.
On August 20, 1997, a final rule document, Treasury Decision
(T.D.) 97-72 was published in the Federal Register (62 FR 44211)
amending section 134.46 of the Customs Regulations to provide
that the requirements of this section are triggered only if it is
determined that the references to a locality other than the
country of origin may deceive or mislead the ultimate purchaser
regarding the actual country of origin of the article. The
revised 19 CFR 134.46 reads:
In any case in which the words "United States," or
"American," the letters "U.S.A.," any variation of such
words or letters, or the name of any city or location
in the United States, or the name of any foreign
country or locality other than the country or locality
in which the article was manufactured or produced
appear on an imported article or its container, and
those words, letters or names may mislead or deceive
the ultimate purchaser as to the actual country of
origin of the article, there shall appear legibly and
permanently in close proximity to such words, letters
or name and in at least a comparable size, the name of
the country of origin preceded by "Made in," "product
of," or other words of similar meaning.
(Emphasis added)
19 CFR 134.47 provides that:
When as part of a trademark or trade name or as part of
a souvenir marking, the name of a location in the U.S.
appears, the article shall be legibly, conspicuously,
and permanently marked to indicate the name of the
country of origin of the article preceded by the words
"Made in," "Product of," or other similar words, in
close proximity or in some other conspicuous location.
The critical difference between the two provisions is that
19 CFR 134.46, when applicable, requires that the name of the
actual country of origin shall appear "in close proximity" to the
non-origin reference and in lettering of at least comparable
size. By contrast, 19 CFR 134.47, which applies regardless of
whether the U.S. locality in the trade name may mislead or
deceive the ultimate purchase, requires that the actual country
of origin appear in close proximity or "in some other conspicuous
location". In either case, the name of the country of origin
must be preceded by "Made in", "Product of", or other similar
words.
In this instance, you have provided evidence that an
application for registration was filed with the United States
Patent and Trademark Office. In HQ 734455 dated July 1, 1992,
Customs considered whether the mere filing of a trademark
registration was sufficient evidence to establish a trademark for
purposes of 134.47. In that ruling, Customs held that "until
further notice we will continue to accept a filed application
with the U.S. Patent and Trademark Office as sufficient evidence
of a trademark for the purposes of 19 CFR 134.47." Therefore, in
this case, although only an application has been filed, Customs
finds that the more general requirements of 19 CFR 134.47 apply
as a result of the "KAZ USA" reference appearing on the chain
itself, the box, and stickers. See also HRL 560161, dated
January 27, 1997.
Because Globe Expo wishes only to mark the boxes or the
spools in which the bicycle chains are sold rather than marking
the bicycle chains themselves, we must consider whether such
marking would be in compliance with 19 CFR 134.47. Due to the
limited surface area on the links of the bicycle chain, we
believe that putting a conspicuous, legible, and permanent
marking on the bicycle chain itself would be difficult. Because
any permanent marking on the chain itself would need to be in a
small size, an ultimate purchaser is likely not to see it, and
moreover, such marking may be difficult to read. In contrast,
the markings on the stickers that will be put on the spools and
boxes and the markings on the boxes themselves can be readily
noticed from a casual inspection, and are easy to read.
Accordingly, we find that in regard to the "KAZ U.S.A." trademark
appearing on the chains, the boxes and the stickers, placing the
country of origin marking on the boxes and spools as described
above would satisfy the requirements of 19 CFR 134.47.
In addition, pursuant to 19 U.S.C. 1304(a)(3)(D) and section
134.32(d), Customs Regulations (19 CFR 134.32(d)), an exception
from individual marking is applicable where the marking of the
container of an imported article will reasonably indicate the
origin of the article. This exception is normally applied in
cases where the imported article(s) is imported in a properly
marked container and the ultimate purchaser in the U.S. will
receive it in its original marked container. If the ultimate
purchaser receives the bicycle chain on a spool or in a box
properly marked with the country of origin, the 19 CFR 134.32(d)
container exception will be applicable.
We have also examined the country of origin marking on the
revised sample box to see if it is in compliance with 19 CFR
134.46. On the same side of the revised retail box where the
reference to Troy, Michigan is present, the country of origin
marking "Made in Poland" will be printed in a comparable size.
We also assume that the marking "MADE IN POLAND" will remain on
side panel of the box where the phrase "U.S.A. ENHANCED" is
printed. Therefore, we conclude that the country of origin
marking on the retail box of bicycle chain sold to individual
consumers is in compliance with the requirements of 19 CFR
134.46. Similarly, the mock-up of the stickers, which will be
placed on the boxes and on the spools in which the chains will be
sold to bicycle manufacturers show the country of origin marking
in a comparable size, in close proximity to the U.S. address, and
preceded by the words "Made in". Therefore the country of origin
markings on the stickers satisfy the requirements of 19 CFR
134.46.
HOLDING:
The special marking requirements for chain do not apply to
bicycle chain. Because an application for a trademark has been
filed with the U.S. Patent and Trademark Office for the "KAZ
U.S.A." oval, the requirements of 19 CFR 134.47 will be triggered
by use of the "KAZ U.S.A." trademark on the bicycle chain, the
boxes, and the spools. In this case, putting the country of
origin marking on the boxes and the spools as described above
will satisfy the requirements of 19 CFR 134.47. The requirements
of 19 CFR 134.46 are triggered by the references to Troy,
Michigan on the boxes and stickers and are satisfied by the
country of origin markings demonstrated by the revised sample
retail boxes and the stickers which will be used for the spools
and the boxes.
A copy of this ruling letter should be attached to the entry
documents filed at the time the goods are entered. If the
documents have been filed without a copy, this ruling should be
brought to the attention of the Customs officer handling the
transaction.
Sincerely,
John Durant, Director
Commercial Rulings Division