MAR-2-05 CO:R:C:V 733678 KG
Robert W. Snyder, Esq.
Wellington Square- Second Floor
940 West 17th Street, Suite F
Santa Ana, California 92706
RE: Country of origin marking of imported surgical towels;
ultimate purchaser; 19 CFR 134.32(d); 19 CFR 134.34.
Dear Mr. Snyder:
This is in response to your letter of May 8, 1990, to the
New York Seaport Customs office requesting a country of origin
ruling on behalf of A Plus International, Inc., regarding
imported surgical towels. Your letter was referred to this
office for response.
FACTS:
A Plus International, Inc., imports surgical towels. The
towels are sterilized and packaged in the U.S. into single
package containers each containing one towel. The single package
container, which is made out of paper and plastic, is marked with
the legend "Made in China-Packaged and Sterilized in U.S.A." The
towels are sold in bulk to hospitals and hospital suppliers. A
sample towel enclosed in a single package container was
submitted for examination.
ISSUE:
Whether the individual imported surgical towels are excepted
from country of origin marking.
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 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. The Court of
International Trade stated in Koru North America v. United
States, 701 F.Supp. 229, 12 CIT (CIT 1988), that: "In
ascertaining what constitutes the country of origin under the
marking statute, a court must look at the sense in which the term
is used in the statute, giving reference to the purpose of the
particular legislation involved. The purpose of the marking
statute is outlined in United States v. Friedlaender & Co., 27
CCPA 297 at 302, C.A.D. 104 (1940), where the court stated that:
"Congress intended 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."
Part 134, Customs Regulations (19 CFR Part 134), implements
the country of origin marking requirements and exceptions of 19
U.S.C. 1304. Section 134.1(d), Customs Regulations (19 CFR
134.1(d)), defines the ultimate purchaser as generally the last
person in the U.S. who will receive the article in the form in
which it was imported. The definition then gives examples of who
might be the ultimate purchaser if the imported article is used
in manufacture, if the imported article is sold at retail in its
imported form and if an imported article is distributed as a
gift. If an imported article is to be sold at retail in its
imported form, the purchaser at retail is the ultimate
purchaser.
In this case, the hospitals and hospital distributors
purchase these surgical towels at retail in their imported form
for their own use. Therefore, the hospitals are the ultimate
purchasers of the imported surgical towels. This is similar to
HQ 733325 (August 8, 1990), where Customs ruled that hospital and
clinics were the ultimate purchasers of imported I.V. drip sets.
Pursuant to 19 U.S.C. 1304(a)(3)(D) and section 134.32(d),
Customs Regulations (19 CFR 134.32(d)), Customs excepts from
individual marking requirements imported articles for which the
marking of the containers will reasonably indicate the origin of
the articles. The exception set forth in 19 U.S.C. 1304(a)(3)(D)
and 19 CFR 134.32(d) applies in cases where the article is
imported in a properly marked container and Customs officials at
the port of entry are satisfied that the ultimate purchaser will
receive it in its original unopened marked container.
Customs has held that imported disposable suture removal
kits which are repackaged and sterilized in the U.S. are excepted
from country of origin marking under 19 CFR 134.32(d). Customs
also ruled in HQ 733325 that imported I.V. drip sets sterilized
in the U.S. and packaged in a sealed container in which the
hospital received it was entitled to the exception set forth at
19 CFR 134.32(d). The hospitals and clinics receive the imported
surgical towels in sealed sterilized containers which are marked
with the country of origin. Particularly in this case where it
is necessary that the imported item be sterile and the hospital
would not be able to use this product unless it was received in
its sterile sealed container, the imported article is entitled to
the exception set forth at 19 U.S.C. 1304(a)(3)(D) and 19 CFR
134.32(d).
Since the imported surgical towels will be repackaged in the
U.S., they are subject to the repackaging requirements of section
134.34, Customs Regulations (19 CFR 134.34), which provides that
an exception may be authorized in the discretion of the district
director under 19 CFR 134.32(d) for imported articles which are
to be repacked after release from Customs custody under the
following conditions: (1) The containers in which the articles
are repacked will indicate the origin of the articles to an
ultimate purchaser in the U.S.; (2) The importer arranges for
supervision of the marking of the containers.
HOLDING:
As long as the conditions set forth in 19 CFR 134.34 are
met, the district director may authorize an exception from
marking the individual imported surgical towels pursuant to 19
U.S.C. 1304 (a)(3)(D) and 19 CFR 134.32(d) if the sterile sealed
individual container is properly marked with the country of
origin of the imported surgical towel.
Sincerely,
Marvin M. Amernick
Chief, Value, Special Programs
and Admissibility Branch
cc: Assistant Area Director, NIS
New York (852401)