MAR-2 OT:RR:NC:N3:140
Ms. Sandra Liss Friedman
Barnes, Richardson & Colburn
100 William Street
New York, NY 10038
RE: COUNTRY OF ORIGIN AND MARKING OF FRAGRANCES IMPORTED FROM CHINA; SECTION 301 MEASURES
Dear Ms. Friedman:
In your letter dated October 14, 2020, you requested a ruling on the country of origin and marking requirements for five different perfumes on behalf of your client, Palm Beach Beaute (PBB).
The five products under review are manufactured in China from fragrance bases which are manufactured in the United States. The trade names for the products are:
Mustang
Ellen Tracy
Aubusson Private Collection - Velvety Rose
Indulgent Moments - Neroli & Sea Salt
Indulgent Moments Pink Peony & Water Lotus
PBB will export bulk shipments of specific perfume oil bases to China. Each of the perfume oil bases, differing from one another in terms of the aroma, contains the essential character of the finished scent which gives the perfume its individuality. All of the perfume oil bases exported by PBB are indicated to have been produced in the United States. Marked samples or images of the finished product were not received with your request. You state that these “perfume oil bases or fragrance essences are recognized by the industry as the essential component of the finished perfume.”
In China, the perfume oil base is blended with alcohol and water, both sourced in China. In some cases, colorants or preservatives sourced from the U.S. fragrance oil supplier, are added to dilute the fragrance to the desired strength so they can be applied by the consumer in a spray bottle. Other minor ingredients may be added that do not change the nature of the finished product and do not cause a substantial transformation.
The blending process decreases the viscosity of the fragrances so that they may be applied via the chosen spray mechanism. You have indicated that some of the blended fragrances may be left standing for a predetermined time to allow complete mixing. You state that no chemical changes occur during the mixing and resting processes. You also state that a similar issue was addressed in Headquarters Ruling H304539, dated April 2020, as well as other rulings.
The first product noted above, Mustang, consists of two different fragrance bases (Part A and Part B). These bases are mixed together in China during the manufacturing process. The other four products (Ellen Tracy, Aubusson Private Collection - Velvety Rose, Indulgent Moments - Neroli & Sea Salt and Indulgent Moments Pink Peony & Water Lotus) each contain only a single fragrance base.
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, U.S. Customs and Border Protection Regulations (19 C.F.R. § 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304. Section 134.1(b), CBP Regulations (19 C.F.R. § 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 [the marking laws and regulations].” For country of origin marking purposes, a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. However, a substantial transformation will not result from a minor manufacturing or combing process that leaves the identity of the article intact. See United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 (1940). Customs has held that the processing of single perfume oil bases into finished fragrances does not constitute a substantial transformation for country of origin marking purposes under 19 U.S.C. § 1304. While the finished fragrances are made suitable for spraying by diluting perfume oil bases, they retain the same chemical identity and character as the precursor perfume oil bases.
Regarding the first product listed above, Mustang, you indicated that it consists of two fragrance components (Part A and Part B). We requested clarification on how the two different fragrance components are combined. In a follow up email you explained that the “Mustang fragrance is composed of the two separate oils” manufactured by the US manufacturer. The US manufacturer provides blending instructions for Part A and Part B to “make the complete finished fragrance that is desired.” PBB does not use the part A and part B oils separately. The mixing process, dilution and bottling, to create the finished product, occurs in China.
As indicated above, the Mustang consists of two separate fragrance oils (Parts A and B) which are mixed together in China to create the finished fragrance. The mixing of the two different oils, in combination with the other ingredients in China, constitutes a manufacturing process that creates a new fragrance distinct from the single oils that are exported from the United States. We find that the country of origin for the Mustang is China. It will be subject to the additional Section 301 duties under Subchapter III, Chapter 99, Harmonized Tariff Schedule of the United States (HTSUS).
Regarding Ellen Tracy, Aubusson Private Collection - Velvety Rose, Indulgent Moments - Neroli & Sea Salt, and Indulgent Moments Pink Peony & Water Lotus, we agree that the processing performed does not substantially transform the perfume oil base into a new and different article of commerce in China. The single perfume oil bases are combined with ethyl alcohol and water, and other minor ingredients. Mere changes in concentration and viscosity do not result in a substantial transformation, despite the fact that the processing operations in China make the fragrances suitable for human application. Therefore, for the purposes of 19 U.S.C. § 1304, the origin remains that of the perfume bases, namely the United States.
As the mixing of the U.S. perfume oil base does not result in a substantial transformation, the subject fragrances remain products of the United States. Therefore, it is our opinion that Section 301 measures will not apply to products 2 through 5, noted above.
Marking of the fragrances as products of the United States is a matter under the jurisdiction of the Federal Trade Commission (FTC). Therefore, should you wish to mark the articles with the phrase “Made in the U.S.A.,” we recommend that you contact them at: U.S. Federal Trade Commission, Bureau of Consumer Protection, Division of Enforcement, 600 Pennsylvania Avenue N.W., Washington, D.C. 20580, or through the FTC’s website at http://www.ftc.gov.
Please also note that perfumery, cosmetic, and toiletry products are subject to the requirements of the Federal Food, Drug, and Cosmetic Act, which are administered by the U.S. Food and Drug Administration (FDA). You may contact them at: U.S. Food and Drug Administration, Office of Cosmetics and Colors, 5100 Paint Branch Parkway, College Park, MD 20740-3835, telephone number (301) 436-1130, or through the FDA’s website at http://www.fda.gov.
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 Paul Hodgkiss at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division