MAR-2-05 CO:R:C:V 730952 jd
Mr. Robert Slomovitz
Chief, Commercial Operations Branch 1
New York Seaport
6 World Trade Center
New York, New York 10048
RE: Country of origin marking requirements for parts and
subassemblies for a plug-in adapter
Dear Mr. Slomovitz:
This is in reply to your letter of December 4, 1987,
requesting advice concerning a country of origin marking inquiry
by Radionic Industries, Inc.
FACTS:
According to Radionic Industries, Inc., letter of October 22,
1987, they import the parts and subassemblies necessary to make a
plug-in adapter. The parts include such articles as coils,
capacitors, and cases. The finished articles are similar to the
type used on telephone answering machines, rechargeable
calculators, etc.
Radionic has requested approval of a plan to mark the parts
and subassemblies "Made in Korea" such that the marking would be
visible upon importation. However, after importation, assembly
of the plug-in adapter would conceal that marking. The finished
units would then be marked "Assembled in the U.S.A."
You express the opinion that Radionic is the ultimate
purchaser of the parts and subassemblies and that the articles
are properly marked at the time of entry.
ISSUE:
Are parts and subassemblies imported for use in the
manufacture of plug-in adapters substantially transformed by such
manufacture so as to make the importer/manufacturer the ultimate
purchaser of the parts and subassemblies for country of origin
marking purposes?
LAW AND ANALYSIS:
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), provides that every article of foreign origin (or its
container) 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 the ultimate purchaser the English name
of the country of origin of the article.
Section 134.35, Customs Regulations (19 CFR 134.35),
implementing the principle of U.S. v. Gibson-Thomsen Co., Inc.,
27 C.C.P.A. 267 (C.A.D. 98), provides that an article used in the
U.S. in manufacture which results in an article having a name,
character, or use differing from that of the imported article
will be considered substantially transformed, and therefore the
manufacturer or processor in the U.S. who converts or combines
the imported article into the different article will be
considered the ultimate purchaser of the imported article within
the contemplation of 19 U.S.C. 1304(a). Accordingly, the article
shall be excepted from marking. However, in accordance with 19
U.S.C. 1304(b) and { 134.22, Customs Regulations (19 CFR 134.22),
the outermost container of the imported article shall be marked
to indicate the country of origin of the article.
Customs has previously ruled that capacitors may be excepted
from individual marking pursuant to 19 U.S.C. 1304(a)(3)(D)
provided they are imported in packages legibly and conspicuously
marked to indicate the country of origin, and Customs officers at
the port of entry are satisfied that the capacitors will reach
the ultimate purchasers in the marked packages (708376; February
23, 1978). In that case, original equipment manufacturers were
determined to be the ultimate purchasers of the capacitors
provided they would use the articles only in the production of
equipment which they manufactured and would not resell the
capacitors in their condition as imported.
HOLDING:
The domestic assembly process to which the parts and
subassemblies are subjected effects a substantial transformation
of those articles into a new and different article of commerce
with a new name, character and use, i.e., a plug-in adapter. The
component pieces lose their separate identity and merge into a
new article. Accordingly, Radionic Industries, Inc., as the
importer/assembler, is considered the ultimate purchaser of the
parts and subassemblies. The parts and subassemblies need not be
marked in such a way that their marking remain visible after
assembly into a plug-in adapter. In fact, only the outermost
container of the parts and subassemblies need be marked at the
time of importation to indicate the foreign origin of the
constituent articles.
Since the constituent imported components of the plug-in
adapter are substantially transformed by assembly, the marking
contemplated on the finished article, "Assembled in the U.S.A.",
is beyond the jurisdiction of the Customs Service. We suggest
the importer contact the Federal Trade Commission, 6th and
Pennsylvania Avenue, N.W., Washington, D.C. 20580, to determine
if such marking would be in accord with various labeling laws
administered by that agency.
Sincerely,
Marvin M. Amernick
Chief, Value, Special Programs
And Admissibility Branch