OT:RR:CTF:FTM H302820 TJS
Amy B. Rice
Northpoint Logistics
4825 NW 41st St, Suite 500
Riverside, MO 64150
RE: Country of Origin of Lip and Eye Liner Pencils
Dear Ms. Rice,
This is in response to your correspondence, dated December 17, 2018, requesting a binding ruling, on behalf of GDM Enterprises DBA The Lano Company, regarding the country of origin of certain cosmetic lip and eye liner pencils. Your request was forwarded to this office by the National Commodity Specialist Division for review. Our ruling is set forth below.
FACTS:
In your request, you state that bulk cosmetic material is manufactured in Italy and shipped to China for assembly into pencil-form. The bulk product is manufactured by mixing non-volatile waxes, oils, and antioxidants with toner and thickening materials at a proper temperature. The mixture is shipped to China in paste or powder form, where it is heated, and filled into Chinese-origin pencil blanks. The filled pencil is then lacquered, if necessary, hot-stamped, sharpened, and put into final packaging.
ISSUE:
What is the country of origin for marking purposes of the lip and eye liner pencils?
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 United States 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 an 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 markings on the imported goods the country of which the good is the product. “The evident purpose is to mark the goods so 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 (1940).
Part 134, Customs and Border Protection (“CBP”) Regulations (19 C.F.R. § 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304. Section 134.1(b), CBP Regulations (19 C.F.R. § 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 this part.” A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, and use which differs from the original material subjected to the process. United States v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982).
In Headquarters Ruling Letter (“HQ”) 558790, dated April 11, 1995, CBP found that imported pencil blanks from China were not substantially transformed as a result of U.S. processing into finished pencils. CBP held that the pencil blank imparted the essence, or essential character, to the completed pencil. The pencil blank contained the lead ingredient, which determined the end use of the finished product as a writing tool, and its underlying shape was retained through completion of the product. Thus, the character of the final product was predetermined by the shape and use of the imported article. While a change in name was a factor to be considered, it was not dispositive, and the processing performed in the United States in completing the designer pencils, while aesthetically pleasing, did not change the underlying shape of the pencil blank nor its primary function.
Similarly, CBP addressed origin of eye liner pencils, comparable to the ones at issue here, in New York Ruling Letter (“NY”) N274713, dated May 6, 2016. In NY N274713, bulk eye pencil material was manufactured and molded into cylinder cores in Italy and then sent to China to be placed into wooden pencil barrels. CBP determined the country of origin of the eye pencils to be Italy. Equally, CBP has consistently found that bulk lipstick mass is not substantially transformed when further processed and repackaged into individual applicators. See NY N301371 (Nov. 2, 2018); NY N008578 (Apr. 16, 2007); and, HQ 734399 (Dec. 28, 1992). HQ 734399 concerned U.S. origin lipstick mass that was shipped to China where it was warmed, molded into stick or “bullet” shapes, and inserted into individual tube applicators that were manufactured in China. CBP held that the processing of the lipstick mass did not change the fundamental character of the original article, and in fact, the lipstick mass imparted the essential character to the lipstick. Furthermore, the processing of the lipstick mass into lipstick bullets did not change the name or use of the lipstick in that the bullets were still considered lipstick and retained its cosmetic use. Therefore, CBP determined that the lipstick mass was not substantially transformed in China and the country of origin of the finished lipstick was the United States.
In this case, we likewise find that the bulk lip and eye liner material imparts the essential character or the essence of the completed lip and eye liner pencils. The bulk material from Italy contains all the essential ingredients of the finished product, with no additional ingredients added in China. The product is considered lip and eye liner regardless of form, notwithstanding the fact that the product is identified as pencils once the bulk material is heated, apportioned and encased into the pencil blanks. Although not suitable for consumer use until put into pencil form, the bulk material determines the end use of the finished product, which is for cosmetic purposes. Filling the bulk material into the blank pencils does not change the name, character, and use of the lip and eye liner. Therefore, we find that the bulk cosmetic material is not substantially transformed when further processed into pencils in China and the country of origin is Italy.
HOLDING:
Based on the facts provided, the country of origin for marking purposes of the lip and eye liner pencils is Italy.
Please note that 19 C.F.R. § 177.9(b)(1) provides that “[e]ach ruling letter is issued on the assumption that all of the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. The application of a ruling letter by a CBP field office to the transaction to which it is purported to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transaction described therein to the actual transaction, and the satisfaction of any conditions on which the ruling was based.”
A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is 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, Yuliya A. Gulis, Chief Food, Textiles and Marking Branch