MAR-2-05 CO:R:C:V 733753 RSD
Mr. Larry Martens
Jano Metal Products, Inc.
24 ST. Remy Drive
Nepean, Ontario K2J 1A3
RE: Country of origin marking of imported water meter
accessories; municipality, ultimate purchaser, cartons, 19 CFR
134.1(d), 19 CFR 134.32(d), 19 CFR 134.34
Dear Mr. Martens:
This is in response to your letter of August 29, 1990,
regarding water meter accessories. In a subsequent telephone
conversation with a member of my staff on November 27, 1990, you
stated that would like a binding ruling on the country of origin
marking requirements for the water meter accessories that you
intend to import into the U.S.
FACTS:
Jano Metal Products, Inc. (Jano) is considering importing
into the U.S. a line of water meter accessories. You indicated
in the November 27, 1990, telephone conversation that the
products are made in Taiwan and will be shipped to Canada before
being imported into the U.S. However, in the next few months
Jano intends to import into the U.S. directly from Taiwan. The
products that will be imported in the U.S. include the following:
- brass couplings for residential water meters
- non-malleable cast iron flange couplings for larger water
meters
- rubber gaskets to fit various sizes of meter couplings
- water meter cable which connects water meters with external
registers
These imported products will be sold by your company only in
carton quantities to municipalities which install water meters.
Your company will deal directly with the municipalities, with no
distributors or agents. You indicate that the cartons containing
the water meter accessories will be properly marked with the
country of origin of the accessories, Taiwan. Although the water
meter accessories are installed with a water meter, in a
customer's home or business, you indicate that even after
installation, the water meters and accompanying accessories
remain the property of the municipality. ISSUE:
Whether water meter accessories sold to municipalities are
required be individually marked with country of origin?
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 its 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; C.A.D. 104 (1940).
Articles for which the marking of the containers will
reasonably indicate the origin of the article are excepted from
marking under 19 U.S.C. 1304(a)(3)(D). For an exception to be
granted under 19 U.S.C. 1304(a)(3)(D), the article must be
imported in the container and that container must reach the
ultimate purchaser unopened. See also 19 CFR 134.32(d).
In order to determine whether this exception applies it is
necessary to determine who is the ultimate purchaser of the water
meter accessories. Part 134 Customs Regulations (19 CFR Part
134), implements the country of origin marking regulations and
exceptions of 19 U.S.C. 1304. Section 134.1(d), Customs
Regulations, (19 CFR 134.(d)) defines ultimate purchaser as
generally the last person in the U.S. who will receive the
article in the form in which it is imported. In this case, if
the ultimate purchaser is the municipality, the above exception
may apply. However, if the municipality's customer is the
ultimate purchaser the exception would not apply. In HQ 731937,
February 27, 1990, Customs ruled that imported sewer caps and
gate valves, if purchased by and for the use of a municipality or
other local government agency, such municipality or agency would
be the last person in the U.S. to receive them in the form in
which they were imported and the ultimate purchaser of these
items for the purposes of 19 U.S.C. 1304. We noted that although
citizens of the municipality pay taxes which ultimately are used
to pay for all municipal purchases, citizens are not involved in
the purchasing decision. In C.S.D. 88-26, HQ 730945, August 11,
1988, Customs determined that a hospital rather than the patient
was the ultimate purchaser of imported patient identification
bracelets because the bracelets are really given to patients for
the hospital's use. Similarly, in this case we find that the
municipalities are the ultimate purchasers of the water meter
accessories because these products are installed in a customer's
home or business, for a municipality's use to determine the
proper billing of its customers. Moreover, the municipalities
actually do the purchasing of the water meters and the
accompanying accessories by deciding which products to buy. Most
significantly, the water meter and the accessories remain the
property of the municipality; ownership or title does not change,
even after installation in a customer's home or business.
Therefore, the municipality is the last person to receive the
water meter accessories in the form in which they are imported,
and would be the ultimate purchaser of the water meter
accessories.
For this ruling, we are assuming that none of the water
meter accessories are pipes or pipe fittings of iron or steel.
We were not presented with any samples and are not able to make a
determination if the any of these articles should considered pipe
or pipe fittings. However, if after the articles are classified,
it is determined that some of the water meter accessories are
pipes or pipe fittings of iron or steel, they would have to be
marked with the country of origin in accordance the requirements
of 19 U.S.C. 1304(c). This provision requires that imported pipe
and pipe fittings of iron or steel must be marked with the
English name of country of origin by means of die stamping, cast-
in-mold lettering, etching or engraving. Because 19 U.S.C. 1304
also does not permit exceptions to marking based on any of the
exceptions listed in 19 U.S.C. 1304(c), if any articles are
considered pipe or pipe fittings, they cannot be excepted from
marking based on 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d).
HOLDING:
The municipalities who buy the water meter accessories
directly from the importer are the ultimate purchasers of these
products. Assuming the water meter accessories are imported in
cartons which are marked to indicate the country of origin and
the district director at the port of entry is satisfied that
these cartons will reach the municipalities unopened, the
individual water meter accessories are excepted from country of
origin marking under 19 U.S.C. 1304(a)(3)(D) and 19 CFR
134.32(d). If the merchandise is going to be repacked in the
U.S., the exception from marking the articles under 19 CFR 134.32(d) will be permitted only if the district director is
satisfied that importer will follow the procedures outlined 19
CFR 134.34. This ruling is not applicable if any of the water
meter accessories are determined to be pipe or pipe fittings of
iron or steel.
Sincerely,
John Durant, Director
Commercial Rulings Division