HQ 734761

October, 16, 1992

MAR-2-05 CO:R:C:V 734761 KR

Mr. Richard H. Abbey
Mudge Rose Guthrie Alexander & Ferdon
2121 K Street, N.W.
Washington, D.C. 20037

RE: Country of Origin Marking for Semiconductors; Products of the U.S. Exported and Returned; 19 CFR 134.32(m); T.D. 75-187; Marking of Containers; "Made in U.S.A."; Multiple Countries of Origin.

Dear Mr. Abbey:

This is in response to your letter dated August 4, 1992, requesting a country of origin marking ruling on behalf of your client, Intel Corporation (hereinafter "Intel"), regarding semiconductors which are manufactured in Korea, Japan, Malaysia, the Philippines and the U.S.

FACTS:

Intel intends to import semiconductors which are manufactured in Korea, Japan, Malaysia, the Philippines, and the U.S. The semiconductors are tested outside of the U.S., at which time they are commingled. After testing the commingled semiconductors are returned to inventory for shipping to the U.S. You state that while it is possible to keep the U.S. semiconductors segregated from the foreign semiconductors, this is impractical and unnecessarily costly.

Approximately 25 percent of the semiconductors will be manufactured in the U.S. The semiconductors built in the U.S., although qualifying as products of the U.S. under the Customs regulations, may not, in your view, qualify for a "Made in the U.S.A." marking pursuant to Federal Trade Commission (hereinafter "FTC") regulations. As products of the U.S. are not subject to the country of origin marking requirements, you seek to avoid this difficulty by marking the containers of the commingled semiconductors with the names only of the foreign countries of origin. Thus, you seek Customs authorization to mark the containers of the semiconductors with the names of all the countries of origin except the U.S. in a manner such as: "Made in Korea, Japan, Malaysia, or the Philippines".

ISSUE:

Does T.D. 75-187 preclude the marking of a container of semiconductor devices with the statement : "Made in ... or ..." without reference to the devices which may be commingled therein which are assembled in the U.S. and are products of the U.S. for Customs purposes?

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.

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.

An article is excepted from marking under 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d), if marking its container will reasonably indicate the origin of the article. Further, as your submission points out, products of the U.S. when exported and returned to the U.S. are exempted from country of origin marking pursuant to 19 CFR 134.32(m). Thus, they would normally be excepted from country of origin marking when returned to the U.S. after overseas testing.

With respect to semiconductor devices, Customs has applied the regulations liberally to allow the marking of their containers with a statement such as "Made in one or more of the following countries..." T.D. 75-187. This marking was permitted because when devices are commingled for bona fide reasons it becomes difficult for Customs to enforce the normal requirement that each imported article be marked with its actual country of origin. Similarly, to require segregation of the devices would have been burdensome upon manufacturers and importers.

However, the Customs authorization to mark in this manner is limited to those cases in which all the devices are of foreign origin; by its terms T.D. 75-187 is "not...applicable if foreign origin devices are commingled with domestically-manufactured devices", as proposed here by Intel. Accordingly, Intel requests clarification and/or modification of T.D. 75-187 to permit a marking of semiconductor containers which lists multiple foreign country names and makes no reference to the U.S. origin (for tariff purposes) of up to 25 percent of the devices contained therein.

Inasmuch as Intel does not seek to refer to the U.S. origin of some of the devices, and is willing to forego such commercial benefits as might accrue to it from using such references, we can find no legal basis to withhold approval of its proposed marking. The U.S. origin devices plainly are eligible to be excepted from country of origin marking pursuant to section 134.32(m) of the Customs Regulations (19 CFR 134.32(m)). When commingled with foreign origin devices and marked under the especially liberal scope of the marking requirements applicable to semiconductor devices under T.D. 75-187 (such formulations as "made in one or more of the following.....", or "Made in ...or.....or....." not generally having been permitted for other articles), there is no measurable loss of accuracy in the marking if the U.S. origin devices are not identified.

HOLDING:

T.D. 75-187 does not preclude multiple country of origin marking for containers of semiconductor devices in the form, "Made in .... or ...." Such marking of semiconductor devices is acceptable when the importer chooses to make no reference to U.S. origin devices commingled with the foreign origin devices and such devices are excepted from country of origin marking as products of the U.S. exported and returned pursuant to 19 CFR 134.32(m). This finding applies only for purposes of country of origin marking under 19 U.S.C. 1304 and Part 134, Customs Regulations, and has no effect with respect to any of the importer's existing obligations with respect to dutiability, licensing, or recordkeeping under the Customs Laws and Regulations.

Sincerely,

John Durant, Director
Commercial Rulings Division