MAR-2-05 CO:R:C:V 732350 KG

Donald J. Unger
Barnes, Richardson & Colburn
200 East Randolph Drive
Chicago, Illinois 60601

RE: Country of origin marking of transducers for hearing aids

Dear Mr. Unger:

This is in response to your letter of April 24, 1989, requesting a ruling regarding the country of origin marking of imported transducers for hearing aids.


Your client ("the importer") imports transducers from the United Kingdom, Malaysia and Taiwan mainly to be incorporated into hearing aids. A transducer is a device used to convert energy from one form to another. In this case, the term "transducer" refers to microphones and receivers. The importer sells at least 90% of the transducers to hearing aid manufacturers who utilize them in the production of hearing aids. The remaining transducers are sold to other original equipment manufacturers who make a variety of different products. The manufacturing processes involved in the production of these various products are not described in your letter and therefore, are not the subject of this ruling.

Hearing aids consist of the following components: a faceplate or subassembly structure on which the components are mounted; a microphone; a receiver; a signal processing circuit; a shell; and various mounting and connecting wires. The microphone allows sounds to be received by the hearing aid and converted to electrical energy. The receiver reconverts the processed electrical energy into sound which is then emitted by the hearing aid. Before a hearing aid is produced, an ear impression and case history are provided to the manufacturer.

The production process includes an impression that is made to create a model of the concha or ear canal entrance. This model is used to prepare the actual shell for the custom fit hearing aid product. The audiogram which represents the hearing capability of the client is provided to the manufacturer. With the case history and other tests, the amount of amplification or acoustic correction to be provided at each frequency by the hearing aid is defined. This information is compared with the hearing aid manufacturer's list of hearing aid circuit designs to select the closest components to fit the product design. This will include the proper microphone, volume control, circuit board, and receiver, and can include special features which are different and unique at each hearing aid original equipment manufacturer.

Appropriate parts are collected and assembled, usually onto a faceplate. This faceplate is typically a thin plastic disc which may already contain the battery holder and contacts. Most manufacturers construct the subassembly faceplate with the microphone and receiver attached using very small wires.

Once the microphone, receiver and circuit have been attached to the faceplate subassembly, it can then be 'married' to the earmold shell. The shell is cemented to the faceplate and excess faceplate material is removed. The circuit, microphone, and receiver are all contained within the cemented shell. Appropriate finish processing is done to the shell to complete the hearing aid.


Whether the transducers are required to be individually marked with the country of origin.


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 U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was "that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is 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 at 302 (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 section 134.35, Customs Regulations (19 CFR 134.35),"an article used in the U.S. in manufacture which results in an article having a name, character, or use differing from that of the imported article will be within the principle of the decision in the case of United States v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98). Under this principle, the manufacturer or processor in the U.S. who converts or combines the imported article into the different article will be considered the 'ultimate purchaser' of the imported article within the contemplation of section 304(a), Tariff Act of 1930, as amended(19 U.S.C. 1304(a)), and the article shall be excepted from marking. The outermost containers of the imported articles shall be marked in accord with this part."

The principle of Gibson-Thomsen Co. is known as substantial transformation. In The Diamond Match Company v. United States, 49 C.C.P.A. 52 (1962), the court interpreted Gibson-Thomsen Co., and determined that imported spatulas used 86% of the time by ice-cream manufacturers who insert the sticks into frozen confectionary are substantially transformed into a new article. The imported spatulas used by the ice-cream manufacturers were held to be excepted from individual country of origin marking. A major factor considered was that the imported spatulas were used by the ice cream manufacturers solely as component parts in the confections and after such use, clearly lost their independent identity. The sticks were firmly set into the mixture and could not be removed without destroying the product. Therefore, the stick "forms an integral part of the product without which it could not function as ice-cream-on-a-stick." The process described in your letter is very similar to Diamond Match in that the transducers are firmly attached to the faceplate and form an integral part of the hearing aid and lose their independent identity or ability to be used in another capacity. The transducers could not be removed from the completed hearing aid without destroying the hearing aid.

In a similar case, Customs held in ruling HQ 730952 (May 18,1988), that parts and subassemblies imported to make plug-in adapters were excepted from individual marking pursuant to 19 CFR 134.35 and it was only required that the outermost containers of the parts and subassemblies be marked because the component parts and subassemblies lost their separate identity and merged into a new and different article of commerce with a new name, character and use, i.e., a plug-in adapter.

The transducers used by hearing aid manufacturers lose their separate identity; the transducers are merged into a new and different article of commerce with a new name, character and use, i.e., a hearing aid. Because the transducers are substantially transformed into hearing aids, the transducers are excepted from individual country of origin marking pursuant to 19 CFR 134.35.


Transducers used by hearing aid manufacturers to make hearing aids are substantially transformed and therefore, are excepted from individual country of origin marking pursuant to 19 CFR 134.35. However, pursuant to 19 U.S.C. 1304(b) and 19 CFR 134.22 at the time of importation the outermost container in which the transducers reach the ultimate purchaser must be marked to indicate the country of origin of the transducers.


Marvin M. Amernick
Chief, Value, Special Programs
and Admissibility Branch