MAR-2-05 CO:R:C:V 734390 NL
Mr. Gary R. Wilmarth
Day, Berry & Howard
CityPlace
Hartford, CT 06103-0100
RE: Country of Origin Marking - Construction and Industrial
Scaffolding; Rentals; 134.32(f); Ultimate Purchaser.
Dear Mr. Wilmarth:
This is in response to your letter dated October 30, 1991,
concerning a waiver of country of origin marking requirements on
behalf of your client, Aluma Systems Corp. (Aluma) and its
related companies, Umacs of Canada, Inc., Aluma Systems, Inc.,
and the Burke Company (the affiliates). As there is no
provision for waivers of country of origin marking requirements
under the applicable statute and regulations, we are considering
your letter as a request for approval of various exceptions from
country of origin marking.
FACTS:
The business of Aluma and its affiliates consists of renting
or leasing scaffolding, shoring, and forming equipment.
Accompanying descriptive literature indicates that the equipment
is in the nature of engineered structural systems which consist
of numerous interlocking components. The components and systems
are manufactured in the U.S. and a number of foreign countries.
Equipment is generally exported to the U.S. from Canada by Umacs
of Canada as intercompany transfers or sales for the accounts of
the U.S. affiliates. The equipment may remain permanently in the
U.S. in the affiliates' rental inventories, or may be resold in
Canada or elsewhere. Over its useful life a piece of equipment
may be moved numerous times between the U.S. and Canada without
being sold.
You represent that for purposes of these multiple cross-
border movements, the equipment is eligible for exception from
country of origin marking pursuant to 19 CFR 134.32(c) as
articles which cannot be marked prior to shipment to the U.S.
except at an expense economically prohibitive of their
importation. In support of this position you state that: 1) the
age of the equipment in the rental fleet makes tracing the
country of origin of the pieces; 2) A significant portion of the
equipment acquired from another company, and the majority of this
equipment is over 20 years old and unidentifiable as to its
origin; and 3) Weather conditions and cleaning requirements for
this equipment causes existing labels and manufacturer
identifications to be removed; and 4) the large numbers of pieces
(in the hundreds of thousands) makes marking of all pieces "near
impossible".
You also request that the exemption provided at 19 CFR
134.32(f) be approved, since the merchandise is leased on short
term and remains the property of the Aluma affiliate. That
section provides an exception from marking for articles imported
for use by the importer and not intended for sale in their
imported or any other form.
Finally, you state that in rare instances the equipment is
sold either during or at the end of a lease term, and you propose
to provide Customs and the purchaser with certain certifications
concerning the marking of this equipment.
ISSUE:
Under what circumstances may this equipment be excepted from
country of origin marking?
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, permanently, and indelibly 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, implements the country of
origin marking requirements and exceptions of 19 U.S.C. 1304.
To the extent that the equipment will not be sold, but is being
imported to become part of the stock of Aluma or one of its
affiliates available for lease or rental, the equipment will be
eligible to be excepted from country of origin marking pursuant
to 19 CFR 134.32(f), implementing 19 U.S.C. 1304(a)(3)(F), which
excepts from marking requirements "articles imported for use by
the importer and not intended for sale in their imported or any
other form." Customs generally has taken the approach that a
person who receives imported articles for his use in a rental
business is considered the ultimate purchaser of the imported
articles, and the articles are excepted from marking. See, e.g.,
HQ 733267 (June 27, 1990)(company which rents shop towels
considered ultimate purchaser of imported towels; individual
towels excepted from marking, as marking of bags will suffice
per 19 CFR 134.32(d).)
Here, the company doing the importing is also the company
doing the renting or leasing. Thus the articles are not
intended for sale in their imported form, but are for the
importer's use as the ultimate purchaser within the meaning of 19
CFR 134.32(f). Accordingly, except as set forth below, the
imported equipment may be excepted from country of origin marking
pursuant to 19 CFR 134.32(f). Moreover, as provided at 19 U.S.C.
1304(b), the containers of articles excepted under 19 U.S.C.
1304(a)(3)(F) are not required to be marked with the country of
origin of their contents.
Because the above-referenced exception from marking is
available to Aluma and its affiliate for this equipment, we find
it unnecessary to consider your claim of exception pursuant to 19
CFR 134.32(c) that the expense of marking would be economically
prohibitive of its importation.
As indicated your submission, in some cases the equipment
imported for consignment to Aluma or its affiliates is
subsequently sold. It is not possible to determine at the time
of importation whether a given item of equipment will later be
sold. Under these circumstances Customs will require, as a
condition for approval of importations excepted from marking
under 19 CFR 134.32(f), that Aluma submit a declaration at
importation that if the articles are later sold they will be
marked in accordance with the requirements of section 304 of the
Tariff Act and Part 134, Customs Regulations.
HOLDING:
The scaffolding equipment and components are imported for
the use of Aluma and its affiliates, which are the ultimate
purchasers of the equipment. Pursuant to 19 U.S.C.
1304(a)(3)(F), 19 U.S.C. 1304(b), and 19 CFR 134.32(f), the
imported equipment and its containers may be excepted from
marking. This exception will be approved provided that the
importer submits to Customs the declaration described above.
Sincerely,
John Durant, Director
Commercial Rulings Division