MAR-2-05 CO:R:C:V 734737 RC
Mr. Harvey A. Isaacs, Esq.
Ms. Beth C. Brotman, Esq.
Siegel, Mandell & Davidson, P.C.
1515 Broadway - 43rd Floor
New York, New York 10036
RE: Country of Origin Marking of Drawer Slides; Furniture kits;
T.D. 91-7; 19 CFR 134.26; 19 CFR 134.34.
Dear Mr. Isaacs and Ms. Brotman:
This is in response to your letter of July 15, 1992,
requesting a ruling on the country of origin marking requirements
for foreign manufactured drawer slides imported into the U.S. and
sold as parts of unassembled furniture kits.
FACTS:
Your client, Hardware Designers, Inc., will import into the
U.S. foreign-made drawer slides ("slides") in bulk. The outer
box cartons will be marked with their country of origin in lieu
of the slides themselves. After importation, the slide sets will
be sold to distributors or manufacturers of unassembled furniture
kits who will package the unmarked slides in retail boxes
containing other furniture components of U.S. origin. The kits
will take a variety of forms, from desks to chests of drawers,
and will either be sold by mail order or in stores in sealed
boxes. The slides will comprise between approximately six and
twelve percent (depending upon the furniture item in question) of
the total material costs of the furniture kits.
ISSUE:
Whether furniture kits containing foreign-made drawer slides
must be marked to indicate their country of origin.
LAW AND ANALYSIS:
The marking statute, section 304, Tariff Act of 1930, as
amended (19 U.S.C. 1304), provides that, unless excepted, every
article of foreign origin (or its container) 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 the English name of the country of origin of
the article. 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) defines the "ultimate purchaser" generally
as the last person in the United States who will receive the
article in the form in which it was imported. The marking must
be conspicuous to the ultimate purchaser. Here, because the
slides would not be used in the manufacture of finished
furniture, the ultimate purchaser is the person who buys the
furniture kit at retail.
The "country of origin" for marking purposes is defined by
section 134.1(b), Customs Regulations (19 CFR 134.1(b)), to mean
the country of manufacture, production, or growth of any article
of foreign origin entering the U.S.
Neither the marking statute nor the Customs Regulations make
any provision for the marking of sets, mixtures or composite
goods. In the absence of any special requirements, the general
country of origin marking requirements apply, i.e., every article
that is imported into the U.S. must be marked to indicate its
country of origin as determined by where the article underwent
its last substantial transformation. See T.D. 91-7 (dated
January 16, 1991).
According to T.D. 91-7, "if the materials or components are
not substantially transformed as a result of their inclusion in a
set or mixed or composite goods, then, subject to the usual
exceptions, each item must be individually marked to indicate its
own country of origin." Thus, where the slides are installed in
furniture prior to retail sale, they are substantially
transformed and not subject to marking. Where the slides are
sold as separate parts of kits, they may constitute significant
components requiring marking. As discussed in T.D. 91-7, Customs
will follow a "common sense" approach in determining whether
articles of foreign origin imported as parts of kits will be
subject to country of origin marking.
In HQ 555365, we found that foreign-made screws when sold
with U.S.-made junction boxes were not subject to marking. The
reasoning was that in terms of value, the screws constituted an
insignificant part of the set, 2.3% of the total value. Here,
the slides account for at least six percent and as much as twelve
percent of the cost of the finished furniture; this percentage
indicates that the value of the slides is not de minimis. It is
our opinion that the slides must be marked with their country of
origin when included in furniture kits.
The required method of marking the drawer slides must be
determined by reference to the condition in which they reach the
ultimate purchaser. Here, the ultimate purchaser is the retail
purchaser of the furniture kit. It does not appear possible in
this instance for Customs to supervise the levels of distribution
through which the drawer slides will pass prior to their
inclusion in furniture kits, or to be sure that the containers of
the kits will be marked to indicate the foreign origin of the
drawer slides. For this reason, marking in bulk will not be
sufficient. It is necessary to insist that the drawer slides be
individually marked at the time of importation in a manner which
is legible, conspicuous, and permanent. To the extent stickers
are used, they must be affixed so as to remain on the article
throughout distribution unless deliberately removed.
Moreover, the importer is subject to the repacking
certification requirements of 19 CFR 134.26, so as to give
assurance to Customs that the packages containing the furniture
kits will be marked to indicate the country of origin of the
slides.
In the alternative, as a way of avoiding the necessity of
marking each slide, the importer may seek approval of local
Customs officials for a repacking operation conducted under
Customs supervision as provided under 19 CFR 134.34. We do not
have sufficient information, for purposes of this ruling, to
determine whether such approval might be appropriate.
HOLDING:
The drawer slides must be marked to indicate their country
of origin at the time of importation. This conclusion is based
upon the finding that the cost of the slides as components of the
furniture kits is not de minimis and Customs cannot supervise the
levels of distribution through which the slides will pass before
their inclusion in the furniture kits. However, this conclusion
does not apply to any instance in which the ultimate purchaser
uses the slides to assemble finished furniture for retail sale.
Sincerely,
John Durant, Director