CLA-2 OT:RR:CTF:TCM H023366 RM

Frederic D. Van Arnam Jr., Esq.
Barnes, Richardson & Colburn
475 Park Avenue South
New York, NY 10016

RE: Country of origin marking requirements for imported lens blanks and frames used to produce clip-on sunglasses; ultimate purchaser; substantial transformation; marking exception

Dear Mr. Van Arnam:

This is in response to your letter dated February 1, 2008, to United States Customs and Border Protection (“CBP”), in which you request a country of origin marking ruling on behalf of your client, Opsales, Inc. (“Opsales”). Specifically, you requested that our office grant a marking exception for reels of lens blanks and frames imported from China or other foreign countries.

FACTS:

Opsales intends to import the components used to manufacture two models of clip-on, non-prescription sunglasses designated as “Shade Control Clips” and “Solarclips.” Both models lack temples and side portions. Opsales will import the lens blanks and the raw clip-on frames from China or other foreign countries. In the United States, the lens blanks will be cut into squares from the reels, edged to the shape of the frame, formed to 4, 6 or 8 base curvature, and inserted into the frame. The clips will then be branded and packaged in cases.

Opsales indicated that it will not mark the imported reels of lens blanks and frames with their country of origin. However, the outermost containers in which the lens blanks and frames are imported will be marked to identify country of origin.

ISSUE:

Whether the imported components may be excepted from individual country of origin markings pursuant to 19 CFR 134.35 upon importation into the United States. LAW AND ANALYSIS:

Section 304 of the Tariff Act of 1930 (19 U.S.C. §1304) provides that, unless excepted, every article of foreign origin imported into the United States 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 United States 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 good is a 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." See United States v. Friedlander & Co., 27 C.C.P.A. 297 at 302 (1940).

Part 134 of the CBP Regulations (19 CFR Part 134) implements the country of origin marking requirements and the exceptions of 19 U.S.C. §1304. Section 134.1(b) of the CBP Regulations (19 CFR 134.1(b)) defines "country of origin" as "the country of manufacture, production or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the ‘country of origin’ within the meaning [of the marking laws and regulations]." The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98)(1940) provides that an article used in manufacture which results in an article having a name, character, or use differing from that of the constituent article will be considered substantially transformed and, as a result, the manufacturer or processor will be considered the ultimate purchaser of the constituent materials. In such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked. See 19 CFR 134.35(a).      

The determinative issue in this case, therefore, is the identity of the ultimate purchaser of the imported components. CBP has consistently held that inserting U.S.-origin, non-prescription lenses into imported frames to make completed, non-prescription glasses, will effect a substantial transformation of the imported frames. See, e.g., HQ 734327, dated February 17, 1993; HQ 733654, dated October 29, 1990; and HQ 562726, dated July 2, 2003. As a result, the ultimate purchaser of the frames is considered to be the manufacturer that inserts the lenses into the frames.

Recently, in Headquarters Ruling Letter (“HQ”) H005537, dated April 5, 2007, CBP considered non-prescription eyewear components that were imported to be manufactured and assembled into eyewear in the United States under two scenarios. Under the first scenario, lens blanks and fully assembled frames were imported together. In the United States, the lens blanks were manufactured into finished lenses by cutting the blanks to size, polishing the cut component, and inscribing the lens blanks and fully assembled frames. The lenses, frames and other components were then assembled to form the finished eyewear. Under the second scenario, the production process was identical to the first scenario; however, the lens blanks were manufactured in the United States. There, CBP determined that, in both scenarios, the imported components were substantially transformed into products of the United States. In accordance with 19 CFR 134.1(d)(1), we found the U.S. assembler to be the ultimate purchaser of the frames and excepted the frames from country or origin marking as long as the outermost containers were properly marked when imported. Similarly, in New York Ruling Letter (“NY”) N016355, dated September 17, 2007, CBP determined that imported sunglass frames, sunglass frames with mounted dummy lenses, and unfinished lens blanks assembled in the United States, were substantially transformed into articles of a new name, character, or use. See also NY J85665, dated June 23, 2003.

Here, in a manner similar to the two scenarios set forth in HQ H005537, upon importation into the United States, the lens blanks are cut into squares, edged to fit the shape of a designated frame, formed to a specific base curvature, and inserted into a clip-on frame. The finished products are new articles of commerce with a different name, use and character than the lens blanks and frames alone (i.e., sunglasses). We conclude, therefore, that the merchandise is substantially transformed into products of the United States when processed into completed clip-on sunglasses. Thus, pursuant to 19 CFR 134.1(d)(1), Opsales is considered to be the ultimate purchaser of the imported frames and, under 19 CFR 134.35(a), the individual frames and lens blanks may be excepted from the individual marking when imported in the United States as long as the outermost containers are properly marked. HOLDING:

Based upon the information and samples presented, it is our opinion that the imported components will be substantially transformed into products of the United States when assembled in the location and manner set forth above. Accordingly, under 19 CFR 134.1(d)(1), Opsales is considered to be the ultimate purchaser of the components. As a result, the imported components are excepted from individual country of origin markings pursuant to 19 CFR 134.35(a), as long as the outermost containers are properly marked when imported into the United States.    A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.                                     

Sincerely,

Gail A. Hamill, Chief
Tariff Classification and Marking Branch