MAR-2 OT:RR:NC:N4:433
Andy S. Wood
International Logistics Specialist
MasterBrand Cabinets Inc.
One MasterBrand Cabinets Drive
PO Box 420
Jasper, IN 47546
RE: THE COUNTRY OF ORIGIN MARKING OF KITCHEN AND BATH CABINETRY ASSEMBLED IN THE UNITED STATES FROM CHINESE PRODUCED COMPONENTS
Dear Mr. Wood:
This is in response to your letter dated December 14, 2009, requesting a ruling on whether the proposed marking “Assembled in USA with China Components” is an acceptable country of origin marking for imported kitchen and bath cabinetry. A marked sample was not submitted with your letter for review.
It has been described by you that kits of cabinetry will be imported into the United States from Chinese manufacturers. The kits will be stored throughout the United States in company leased warehouse locations. When customer orders are received these kits will be pulled from inventory and assembled in the United States warehouse. After assembly, the finished cabinetry will be packaged and boxed, and distributed throughout the United States.
You state that the contents of the kits from the Chinese supplies are:
Assembled, stained, and topcoated, cabinet face frames (Chinese oak, Chinese Birch, Chinese Maple). These parts are produced from Chinese domestic woods, processed in China, assembled into the cabinet components and stained / topcoated in China.
Assembled, stained, and topcoated cabinet doors (Chinese oak, Chinese Birch, Chinese Maple). These parts are produced from Chinese domestic woods, processed in China, assembled into the cabinet components and stained / topcoated in China.
Stained and topcoated cabinet drawer fronts (Chinese oak, Chinese Birch, Chinese Maple). These parts are produced from Chinese domestic woods, processed in China, and stained / topcoated in China.
Stained and topcoated cabinet drawer components (Chinese birch). These parts are produced from Chinese domestic woods, processed in China, and topcoated in China.
Stained and topcoated cabinet box components: backs, tops, bottoms, shelves, ends, stretcher rails, toekicks (Chinese wood core plywood with veneers of various species). These parts are produced from Chinese plywood from Chinese wood species. Processing includes cutting, grooving, sanding, staining / topcoating.
Door hinges (manufactured in China).
Decorative surface hardware: knobs and pulls (manufactured in China).
You further provide that the kit will not come with:
Fasteners: staples, screws (Taiwan and China)
Adhesive (manufactured in US)
Drawer opening / closing mechanism (manufactured in China)
Corrugated carton (manufactured in US)
Product labeling (manufactured in US)
The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. 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 U.S. the English name of the country of origin of the article. Part 134, Customs Regulations (19 CFR part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.
Section 134.35, Customs Regulations (19 CFR 134.35), states that the manufacturer or processor in the U.S. who converts or combines the imported articles into articles having a new name, character or use will be considered the ultimate purchaser of the imported article within the scope of 19 U.S.C. 1304 and the article will be excepted from marking. The outermost containers of the imported articles shall be marked, but the new articles resulting from the United States processing or manufacturing is excepted from country of origin marking requirements.
Section 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 Part 134 of the 19CFR.
A substantial transformation occurs when articles lose their identity and become new articles having a new name, character, or use. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 at 270 (1940); Koru North America v. United States, 12 CIT 1120, 701 F.Supp. 229 (1988). The question of when a substantial transformation occurs for marking purposes is a question of fact based upon the totality of the circumstances to be determined on a case-by-case basis. Uniroyal Inc. v. United States, 3 CIT 220, 542 F.Supp. 1026 (1982), aff'd, 1 Fed. Cir. 21, 702 F.2d 1022 (1983).
In determining whether the combining of “parts or materials” constitutes a substantial transformation, the issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article. Belcrest Linens v. United States, 6 CIT 204, 573 F.Supp. 1149 (1983), aff'd, 2 Fed. Cir. 105, 741 F.2d 1368 (1984).
In Carlson Furniture Industries v. United States, 65 Cust. CT 474 (1970), the Court concluded that the imported finished and unfinished chair parts assembled in the United States into finished chairs was a substantial transformation. It was determined that the imported articles alone were insufficient to create finished chairs, and that additional work and materials would have to be added to the imported articles, for purposes of creating functional articles of commerce. See Headquarters Rulings: HQ 734050 dated June 17, 1991 and HQ W563456 dated July 31, 2006.
Like Carlson Furniture, the importer assembles components by fitting and gluing wooden parts together, and fastening and stapling of joints together, in the manufacture of kitchen and bath cabinetry. Additionally: the drawer components will be pulled from the kit and glue will be applied to the dovetailed components, then the drawer box will be assembled and clamped, and finally the drawer suspension system will be attached to the drawer. Following this process, the cabinet frame with doors attached will be removed from the kit; the cabinet end panels will be stapled onto the frame in a cabinet clamp; the bottom will be glued and stapled into place; the back and toe-kick panel will be glued and stapled in place; the stretcher rails and drawer suspension system will be installed; and finally the assembled drawers or shelves will be placed into the cabinet. After assembly of the cabinetry, the completed unit will be boxed in a U.S. produced carton and labeled for shipment.
We are of the opinion that the assembling of the kitchen and bath cabinetry involves a significant amount of processing of the imported components (articles) and is more than mere assembly, resulting in a substantial transformation of those components into finished articles of commerce. Accordingly the assembled cabinets are products of the United States, and are excepted from the country of origin marking requirements, and require no country of origin marking. Marking is required on the outermost containers or cartons of the imported cabinetry components from China.
Regarding the marking of the kitchen and bath cabinetry, if a good is determined to be an article of United States origin, it is not subject to the country of origin marking requirements of 19 U.S.C. §1304. Whether an article may be marked with the phrase "Made in the USA" “Assembled in USA with China Components” or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is assembled in the U.S.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Neil H. Levy at (646) 733-3036.
Sincerely,
Robert B. Swierupski
Director
National Commodity Specialist Division