MAR 2-05 CO:R:C:V 731799 LR
Raymond R. Driscoll
Development Director
Falcon Rule
Auburn, Maine 04210
RE: Country of Origin Marking of Wooden Pens
Dear Mr. Driscoll:
This is in response to your letter dated September 14,
1988, requesting a ruling on the marking requirements for wooden
pens imported from Taiwan which are printed after importation
with advertising information.
FACTS:
Wooden pens in the shape of baseball bats, hockey sticks
and rulers are imported from Taiwan. After importation your
company prints the pens with advertising information in
accordance with individual purchase contracts and sells them to
advertising specialty distributors. According to your letter,
the pens are imported and sold in poly bags of 50 in each bag.
In lieu of marking each pen with the country of origin, you
propose marking the poly bags.
ISSUE:
Are wooden pens which are made in Taiwan and printed in the
U.S. with advertising information excepted from individual
country of origin marking requirements?
LAW AND ANALYSIS:
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), requires that every article of foreign origin (or its
container) imported into the U.S., subject to certain specified
exceptions, 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
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of origin of the article. "Ultimate purchaser" is defined in
section 134.1, Customs Regulations (19 CFR 134.1), as "the last
person in the U.S. who will receive the article in the form in
which it was imported." The regulation further provides that if
an imported article will be used in manufacture, the manufacturer
may be the "ultimate purchaser" if he subjects the imported
article to a process which results in a substantial transform-
ation of the article. In such case, the imported article is
excepted from individual marking pursuant to section 134.35,
Customs Regulations (19 CFR 134.35), and only the outermost
container is required to be marked.
However, if the manufacturing process is a minor one which
leaves the identity of the imported article intact, 19 CFR 134.1
provides that the consumer or user of the article, who obtains
the article after the processing, will be regarded as the
"ultimate purchaser". The regulation also provides that if the
imported article is distributed as a gift the recipient is the
"ultimate purchaser". In each of these instances, the article
must be individually marked with the country of origin.
In order for a substantial transformation to be found, an
article having a new name, character, or use must emerge from
the processing. See United States v. Gibson-Thomsen Co. Inc.,
27 C.C.P.A. 267 (C.A.D. 98). Two factors that are relevant to
the issue of substantial transformation are whether the
processing done in the U.S. substantially increases the value of
the imported article or transforms the article so that it is no
longer the essence of the final product. See National Juice
Prodcuts Association v. United States , 10 CIT ___ , 628 F. Supp.
978 (1986).
In this case, we find that the printing of advertising
information on the pens does not constitute a substantial
transformation. First, the printing does not materially alter
the name, character or use of the imported articles. At the time
of importation, the articles in question would properly be
referred to as pens and more specifically characterized as wooden
pens in the shape of baseball bats, hockey sticks and rulers.
The use of the pens is as writing implements. After the printing
of the advertising information, they remain articles properly
referred to as pens, characterized as wooden pens in the shape of
baseball bats, hockey sticks and rulers, and used as writing
implements. The fact that the pens may also be used for
advertising purposes, does not, in our opinion, materially change
their underlying use as writing implements.
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For these same reasons, we believe that the printing does
not transform the imported article so that it is no longer the
essence of the final product. Both before and after the
printing, the essence of the article in question is a finished
writing implement with an unusual shape. It is also unlikely
that the printing substantially increases the value of the
product. Based on these considerations, we find that printing is
merely a minor manufacturing process which leaves the identity of
the imported articles intact. As such, the recipient of the pens
(even if they are distributed as gifts), rather than the company
that prints the pens, or the companies that distribute them, is
considered the ultimate purchaser.
HOLDING:
Wooden pens in the shape of baseball bats, hockey sticks
and rulers, which are made in Taiwan are not substantially
transformed in the U.S. by printing advertising information on
them. Accordingly, the final recipient of the pens, rather than
either the U.S. company that prints the pens or the companies
that distribute them to the final recipient, is the ultimate
purchaser. Therefore, each pen must be individually marked in
the manner set forth in 19 U.S.C. 1304 and 19 CFR Part 134.
Sincerely,
Marvin M. Amernick
Chief, Value, Special Programs
and Admissibility Branch