MAR-2 OT:RR:NC:N1:102
Ms. Susan Hrobar
Rapid Air Systems LLC
W233N2833 Roundy Circle West
Suite 200
Pewaukee, WI 53072
RE: THE COUNTRY OF ORIGIN MARKING OF PARTS OF AIR PUMP SYSTEMS
Dear Ms. Hrobar:
This is in response to your letter dated December 20, 2011 requesting a ruling on the marking of imported pallets of air pump parts. A marked sample was not submitted with your letter for review.
The articles in question are described as air pump components imported for assembly in the United States to produce finished air pump systems for air beds. Rapid Air imports some, but not all, of the components for the air pump system. These components comprising the “shell” of Rapid Air’s air pump system are imported from a Chinese manufacturer, and generally include an outer injection molded case that houses a manifold sub-assembly and a metal air motor, and two injection molded plastic remote cases (top and bottom) that are packed in the final packaging. The majority of the imported components, including the molded case and manifold sub-assembly, are designed and engineered by Rapid Air.
After importation, Rapid Air substantially transforms the components into a functioning air pump system at its Wisconsin facility by adding the “brains” of the air pump system, including the printed circuit board assemblies for both the air pump and the two remotes, and proprietary software. Subsequent to importing the basic parts of the case and pump from China, Rapid Air also conducts extensive testing and final assembly of the finished air pump system using proprietary testing equipment. The assembly and testing process is performed by trained assemblers and testers, as well as by computers. Not until the assembly and testing process described above occurs can the imported components be used as part of a functioning air pump system.
You indicate that the imported components will be packed within an outermost container comprised of shrink wrap plastic encasing a pallet of individual boxes containing the air pump components. You also indicate that the inner boxes in which the air pump components are packed will be used to package the finished air pumps after assembly in the United States and that those inner boxes will be printed in China with “Designed, engineered, final assembled and tested in the USA from components and materials made in the USA and China.” The latter printed language will not be visible when the pallet arrives at the port of entry. The only marking visible upon entry will be “Made in China” on all four sides of the shrink-wrapped pallet.
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 USC 1304. Section 134.1(d), defines the ultimate purchaser as generally the last person in the U.S. who will receive the article in the form in which it was imported. 19 CFR 134.1(d)(1) states that if an imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if the manufacturer subjects the imported article to a process which results in a substantial transformation of the article. An article used in manufacture which results in an article having a name, character or use differing from that of the constituent article will be considered substantially transformed and that the manufacturer or processor will be considered the ultimate purchaser of the constituent materials. Pursuant 19 CFR 134.35, in such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked.
Based on the information made available, all the imported air pump components are used by Rapid Air Systems in the production of finished air pumps and are not sold in their condition as imported. Accordingly, we find that the imported components are substantially transformed into articles with a new name, character or use, when processed in the United States to produce finished air pumps, and that Rapid Air Systems is the ultimate purchaser of such kits. In accordance with 19 CFR 134.35, the imported components, provided they are used by Rapid Air Systems in the assembly of completed air pump systems and not sold separately in their condition as imported, are excepted from individual marking. The outermost containers of articles excepted from marking under 19 CFR 134.35 are required to be marked to indicate the country of the imported articles. Accordingly, the shrink-wrapped pallets containing the individual boxes of pump components shall be marked to indicate China as the country of origin.
Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin is an issue under the authority of the Federal Trade Commission (FTC). In regard to the acceptability of your proposed markings on the boxes in which the completed air systems will be packaged after assembly in the United States, we suggest that you contact the Federal Trade Commission, Division of Enforcement, 6th and Pennsylvania Avenue, NW, Washington, D.C. 20508, as to whether the proposed markings satisfy their requirements.
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 Kenneth T. Brock at (646) 733-3009.
Sincerely,
Thomas J. Russo
Director
National Commodity Specialist Division