CLA-2 CO:R:C:V 731425DBI
Mr. Edwin C. Bullock
Kuhn and Muller
1412 Broadway
New York, New York 10018
RE: Country of origin marking requirements for plastic bottles
made in Canada, filled with U.S. spring water; and the
applicability of partial duty exemption of item 800.00,
TSUS, to U.S. spring water exported to Canada for bottling.
Dear Mr. Bullock:
This is in response to your letter of May 5, 1988, in which
you request a ruling concerning the country of origin marking
requirements, and the applicability of item 800.00, Tariff
Schedules of the Unites States (TSUS), for U.S. spring water,
which will be bottled in Canada in plastic bottles made in
Canada.
FACTS:
You advise that spring water sourced in the U.S. will be
exported to Canada for bottling into 1.5 liter plastic bottles.
The bottling will be performed through a "blow-molding" process
whereby raw resin is melted into a liquid plastic, the liquid
plastic is poured into a mold, and air is forced into the center
of the liquid plastic. The plastic then cools, hardens around
the mold into the bottle shape, and is immediately filled with
the spring water. A cap is then placed onto the top of the
plastic bottle and a label is pasted onto the outside surface of
the bottle. The label identifies the fact that the spring water
is a product of the State of Maine. The label also contains the
name and address of the U.S. distributor. The bottles will then
be packed in cardboard cartons, each containing twelve bottles.
The cartons will be placed on wooden pallets, loaded into trucks,
and returned to the U.S.
ISSUES:
1) Does a plastic bottle made in Canada and imported into
the U.S. filled with U.S. sourced spring water have to be marked
to indicate that it is a product of Canada when the bottle
contains a label which identifies the fact that the spring water
is a product of Maine and bears the U.S. address of the
distributor?
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2) Whether the described bottled spring water, when returned
to the U.S., will be eligible for the partial exemption from duty
provided for in item 800.00, TSUS (9801.00, Harmonized Tariff
Schedule of the United States (HTSUS))?
LAW AND ANALYSIS:
Section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304)
requires that, unless excepted, every article of foreign origin
must be marked to indicate the country of origin to an ultimate
purchaser in the U.S. Products of the U.S. exported and returned
are excepted from marking requirements pursuant to section
134.32(m), Customs Regulations (19 CFR 134.32(m)). Since the
spring water which is exported to Canada is merely bottled, it is
still a product of the U.S. upon its return. Therefore, it is
not subject to the marking requirements of 19 U.S.C. 1304.
The bottle, however, is required to be marked to indicate
its Canadian origin unless it is a disposable container. Section
134.24(a), Customs Regulations (19 CFR 134.24(a)), defines
disposable containers as "the usual ordinary types of containers
or holders, including cans, bottles, paper or polyethylene bags,
paperboard boxes, and similar containers or holders which are
ordinarily discarded after the contents have been consumed."
When disposable containers are imported full and the contents are
excepted from marking, the containers are not required to be
marked to show the country of their own origin, but are to be
marked to indicate the origin of their contents regardless of the
fact that the contents are excepted from marking requirements.
(19 CFR 134.24(d).
In this case, the imported plastic bottles are clearly
disposable containers within the meaning of 19 CFR 134.24(a), in
that they are the usual ordinary type of container used to hold
spring water. Although some purchasers may choose to keep the
bottles, we believe that such containers are ordinarily discarded
after the contents have been consumed. In accordance with 19 CFR
134.24(d) the disposable bottles are not required to be marked to
show the country of their own origin. Ordinarily, such
containers would be required to be marked to indicate the origin
of their contents. However, in this case, since the contents are
a U.S. product, no country of origin marking would be required on
the container. (The requirements of 19 U.S.C. 1304 are applicable
only to articles "of foreign origin"; the U.S. sourced spring
water is not considered an article "of foreign origin" within the
meaning of the statute.)
The next consideration is whether the bottles have to be
marked to indicate their Canadian origin pursuant to section
134.46, Customs Regulations (19 CFR 134.46), which
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provides that in any case in which the name of a 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, 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).
We find that neither the reference to the fact that the
spring water is a product of Maine nor the U.S. address of the
distributor triggers the requirements of 19 CFR 134.46. This
stems from the fact that the "article" referred to 19 CFR 134.46
is the article itself (the U.S. spring water) and not the
disposable Canadian container. Therefore, the U.S. address on
the bottle is not the name of a locality other than the country
or locality in which the article was manufactured or produced.
See HQ 729817, dated November 13, 1986 (Canadian wine cooler
cartons bearing a U.S. address to be filled with U.S. wine
coolers are not required to be marked with the country of origin;
the U.S. address appearing on the carton is not inconsistent with
the country of origin of the contents.)
Item 800.00, TSUS, provides for the free entry of articles
of U.S. origin which are exported and returned without being
advanced in value or improved in condition while abroad. We have
previously held in a ruling dated July 7, 1987 (HQ 554643) that
bulk wines exported by tank car in a finished condition to Canada
to be placed in labelled bottles without any additions could be
returned to the U.S. free of duty under item 800.00, TSUS.
In this case, water is being exported in a finished
condition to Canada to be bottled without any additions. The
water has not been advanced in value nor improved in condition
while abroad. Accordingly, we are of the opinion that the water
to be imported qualifies for treatment as American goods returned
under item 800.00, TSUS.
Additionally, General Headnote 6(b)(i), TSUS, addresses the
tariff treatment for containers or holders for imported
merchandise, not imported empty. Pursuant to Headnote 6(b)(i),
the plastic bottles would be containers of usual types ordinarily
sold at retail with their contents and the cardboard cartons
would be usual types of shipping containers not designed for or
capable of reuse. Therefore, the bottles and cartons would not
be subject to treatment as imported articles and can be returned
to the U.S. free of duty.
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HOLDING:
For purposes of 19 U.S.C. 1304, disposable plastic bottles
filled with U.S. spring water are not required to be marked with
the country of origin of the bottles, even if the bottles contain
a U.S. address.
For the purposes of item 800.00, TSUS, and General Headnote
6(b)(i), TSUS, the spring water, bottles and cartons may be
entitled to free entry as American goods returned.
Sincerely,
John Durant, Director
Commercial Rulings Division
1cc: CLA-2 CO:R:C:V:DIZZO:LDC:6/16/88
Mr. Edwin C. Bullock
Kuhn and Muller
1412 Broadway
New York, New York 10018