MAR 2-05 CO:R:C:V 732196 LR
R. Theodore Hume, Esq.
Beveridge & Diamond, P.C.
1333 New Hampshire Avenue, N.W.
Washington, D.C. 20036
RE: Country of origin marking requirements for cold finished
steel bar products
Dear Mr. Hume:
This is in response to your letter of March 1, 1989,
submitted on behalf of Laurel Steel Products, Burlington,
Ontario, Canada, requesting a ruling on the country of origin
marking requirements of imported hot-rolled steel bars which are
processed in the U.S. into cold finished bars. The issue of
whether the processing of hot-rolled steel bars into cold
finished bars constitutes a substantial transformation will be
the subject of separate responses. You would like a ruling on
the marking requirements applicable to the cold finished product
assuming it is determined that the U.S. processing does not
constitute a substantial transformation.
FACTS:
According to your letter, your client's U.S. subsidiary
imports hot-rolled steel metal bars and processes them in the
U.S. into cold finished bars. Cold finished bars are held
together by metal bands. As many as 199 bars may be banded
together for shipment to a customer. The number of bars varies
according to the size and lengths of the cold finished bars
involved. In your opinion, both the steel bars and the metal
bands are excepted from country of origin marking.
ISSUE:
Assuming that the U.S. processing of hot-rolled steel bars
into cold finished bars does not constitute a substantial
transformation, do either the cold finished bars or the metal
band that hold the cold finished bars together for shipment have
to be marked to indicate the country of origin?
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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) 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
the English name of the country of origin of the article.
You cite 19 U.S.C. 1304(a)(3)(F), (G), (H), and (J) as
statutory exceptions which you believe may be pertinent to your
client's importations. As discussed below, we find that the
steel bars are excepted from individual marking under 19 U.S.C.
1304(a)(3)(J), although the metal bands are required to be
marked.
Articles of a class or kind listed in section 134.33,
Customs Regulations (19 CFR 134.33), are on the so-called "J-
list" and are excepted from individual marking requirements in
accordance with the provisions of 19 U.S.C. 1304(a)(3)(J). Metal
bars, except concrete reinforcement bars, are among the classes
of articles which are included on the "J-list". Accordingly,
except for concrete reinforcement bar, neither hot-rolled steel
bar nor the cold finished steel bar is required to be
individually marked with its country of origin.
However, 19 CFR 134.33 further provides that if articles
included on the "J-list" are imported in containers, the
outermost container in which the article ordinarily reaches the
ultimate purchaser is required to be marked to indicate the
origin of its contents. In addition, if a "J-list" article will
be repacked into new containers after leaving Customs custody,
the importer must certify that the new container will be marked
to indicate the country of origin of the contents (see section
134.25, Customs Regulations (19 CFR 134.25)). Customs has taken
the position that this provision is applicable unless the
imported article is substantially transformed prior to the
repacking.
Based on the assumption that the U.S. processing is not a
substantial transformation, the container in which the cold
finished bar is sold must be marked to indicate the country of
origin of the imported hot-rolled steel bar. The metal bands
holding the bars together are subject to marking if they are
considered containers under 19 CFR 134.33.
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Customs has previously determined that metal bands are
considered containers for marking purposes. Specifically,
Customs has repeatedly ruled that a metal band or strap
constitutes a container under the provisions of 19 U.S.C.
1304(a)(3)(D) and section 134.32(d), Customs Regulations (19 CFR
134.32), which authorize an exception from marking for articles
when the container of such article will reasonably indicate the
origin of such article. (See HQ 731768, December 8, 1988,
regarding metal bands holding together a bundle of joists; HQ
731335, July 28, 1988, metal strip used to secure section of
concrete interlocking pavestones; HQ 731555, July 18, 1988, metal
straps and plastic shrink wrap used to secure bricks; C.I.E.
399/50, November 10, 1950, metal straps which hold bundles of
concrete reinforcement bars together). In a case involving the
application of an exception under 19 CFR 134.33, Customs found
that a spool or reel on which wire (also a "J-list" article) was
wound was a container that had to be marked (HQ 723781, January
17, 1984).
The requirement to mark the container of a "J-list" article
even though the article itself is excepted from marking is to
ensure that the ultimate purchaser is advised of the country of
origin whenever possible. The conclusion that the metal bands
holding together steel bar is a container under 19 CFR 134.33 is
consistent with our previous determinations on this issue and
with the underlying purpose for requiring that containers of "J-
list" articles be marked.
Accordingly, although both the hot-rolled and cold finished
steel bars are excepted from individual marking under 19 U.S.C.
1304(a)(3)(J) and 19 CFR 134.33, the metal bands securing them
are containers which may be subject to marking. If the U.S.
processing of the hot-rolled bars does not constitute a
substantial transformation, in accordance with 19 CFR 134.25, the
importer would be required to certify at the time of importation
that the metal bands securing the cold finished bars (or any
other container) will be marked to indicate the country of origin
of the imported product. However, if the U.S. processing of the
hot-rolled bars does constitute a substantial transformation,
such certification would not be required. In either case, the
container in which the hot-rolled product is imported must be
marked to indicate the country of origin.
The other exceptions which are cited are not applicable in
the circumstances presented. The exception provided in 19 U.S.C.
1304(a)(3)(F), which pertains to articles imported for use by the
importer and not intended for sale in its imported or any other
form, is not applicable since according to the facts presented,
the imported steel bar is intended for sale.
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The exception provided in 19 U.S.C. 1304(a)(3)(H) which
applies if an ultimate purchaser, by reason of the character of
such article or by reason of the circumstances of its
importation, must necessarily know the country of origin of such
article even though it is not marked to indicate its origin, is
not applicable since the country of origin of steel bar cannot be
determined on the basis of the character of the product alone and
the latter part of this exception applies only in those instances
where the importer is the ultimate purchaser of the imported
articles and has direct contact with the foreign supplier (HQ
730243, March 5, 1987). Based on the assumption that the
processing performed by the importer does not constitute a
substantial transformation, the importer would not be considered
to be the ultimate purchaser and this exception would not apply.
Finally, no evidence has been presented to support a
marking exception under 19 U.S.C. 1304(a)(3)(G) which excepts
from marking "articles to be processed in the United States by
the importer or for his account otherwise than for the purpose of
concealing the origin of such article and in such manner that any
mark contemplated by this section would necessarily be
obliterated, destroyed, or permanently concealed". In addition,
as interpreted by Customs, articles excepted from marking under
this provision must be marked with the country of origin after
the U.S. processing (HQ 729434, May 23, 1986).
HOLDING:
Metal bars, including hot-rolled and cold finished bars,
are excepted from individual country of origin marking under 19
U.S.C. 1304(a)(3)(J). However, the metal bands holding the
product together are considered containers which may be subject
to marking. If the U.S. processing of the hot-rolled bars does
not constitute a substantial transformation, the metal bands
holding the finished product together are required to be marked
to indicate the country of origin of the imported bars. In such
case, the importer should follow the certification procedures set
forth in 19 CFR 134.25. If, however, the U.S. processing of the
hot-rolled bars does constitute a substantial transformation, the
bands holding the finished product together do not have to be
marked and the certification procedures do not apply. In either
case, the container in which the hot-rolled bars are imported are
subject to marking.
Sincerely,
John Durant Director
Commmercial Rulings Division