Marking of country of origin of steel plates and friction discs; repackaging; 19 U.S.C. § 1304, 19 CFR §§ 134.32, 134.26.

HQ H113476 September 20, 2010 MAR-2: OT:RR:CTF:TCM HQ H113476 DC CATEGORY: Marking Ms. P. Rivka Schochet Miller, Canfield, Paddock and Stone, P.L.C. 150 West Jefferson, Suite 2500 Detroit, Michigan 48226 RE: Marking of country of origin of steel plates and friction discs; repackaging; 19 U.S.C. § 1304, 19 CFR §§ 134.32, 134.26. Dear Ms. Schochet: This is in response to your letter of June 16, 2010, requesting a ruling on behalf of EXEDY Globalparts Corporation (“EGP”) regarding the country of origin marking of steel plates and friction discs. FACTS: The subject merchandise consists of steel plates and friction discs, for use in motor vehicle transmissions, transmission repair and overhaul. You state it is manufactured in Japan or China. You plan to repack and sell small quantities of individually wrapped sets of steel plates and friction discs directly to retail motor vehicle repair businesses. The repackaged steel plates and friction discs that are to be sold to automobile repair shops will be packed in small sets in plastic-wrapped cardboard. These plastic-wrapped cardboard packages will be clearly marked with labels with the name of the country of origin in English marking the subject merchandise as “Made in Japan” or “Made in China”, as appropriate. The only merchandise that will be packed in each shrink-wrapped set will be the subject merchandise, the steel plates and/ or friction discs. You also sell steel plates and friction discs in bulk to repackers who use steel plates and friction discs in motor vehicle transmission repair kits, which in turn will be sold to retail motor vehicle repair establishments. The steel plates and friction discs will be packed in sets of 250 (two hundred fifty), wrapped in plastic bags, and packed in the cardboard shipping boxes, which will be marked with the country of origin, “Made in Japan” or “Made in China”, as appropriate. There will be no other merchandise inside the marked boxes containing the sets of 250 steel plates and friction discs. The steel plates and friction discs sold in bulk will not be repackaged, and will be shipped again in the same boxes and in the same manner as when originally imported. You state the bulk containers in which the steel plates and friction discs are shipped and sold will be marked, with the name of the country of origin in English on the containers for the steel plates and friction discs as “Made in Japan” or “Made in China”, as appropriate on the outside of the boxes containing the steel plates and friction discs. The importer, EGP, states in its ruling request that it will comply will the requirements of 19 CFR § 134.26, to include the certification requirement(s) 134.26(a), and the notice requirement(s) of 134.26(d). ISSUE: Whether the steel plates and friction discs are excepted from individual 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 (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 United States the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. § 1304 was “that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will.” United States v. Friedlaender & Co., 27 C.C.P.A. 297, 302 (1940). The Customs and Border Protection (“CBP”) Regulations located at Part 134, (19 CFR Part 134), implement the country of origin marking requirements and the statutory exceptions of 19 U.S.C. § 1304. Pursuant to the CBP Regulations at 19 CFR § 134.1(d), the “ultimate purchaser” is generally defined as the last person in the United States who will receive the article in the form in which it was imported. Pursuant to 19 U.S.C. § 1304(a)(3)(D) and 19 CFR § 134.32(d), an exception from individual marking is applicable where the marking of a container of such article will reasonably indicate the origin of the article. This exception is normally applied in cases where the article is imported in a properly marked container and CBP personnel at the port of entry are satisfied that the ultimate purchaser will receive it in the original unopened marked container. Relevant factors regarding whether an article is likely to remain in its original container may include the nature of the article, the type of container, and the chain of distribution. In your submission, you argue that the steel plates and the friction discs are excepted from individual country of origin marking pursuant to 19 CFR § 134.32(a), (b), and (d), because the steel plates and friction discs are: 1) articles that are incapable of being marked, 2) are articles that cannot be marked prior to shipment to the United States without injury, and 3) the marking of the containers will reasonably indicate the origin of the articles. You have stated that engraving country of origin on the steel plates would cause defects in performance of such precision machined merchandise. The function of the steel plates and friction discs is to hold and release fast moving gearing in a vehicle transmission and any degradation of the performance of any part in a transmission could have a negative effect on the performance of several other parts, lessening the performance of the entire transmission. You have not submitted sufficient factual evidence to satisfy CBP that the imported merchandise is incapable of being marked, or cannot be marked without injury. See HQ H563298, dated September 1, 2005. However, in light of the particular facts and circumstances relevant to the subject merchandise, we find that 19 CFR § 134.32(d) is applicable to this case. See HQ H563298, dated September 1, 2005. See also NY I84893, dated August 30, 2002. The procedures provided at 19 CFR § 134.26 may be applied to articles properly marked at the time of importation that will be repackaged in retail containers after their release from CBP custody. See HQ 560024, dated December 20, 1996. Since the steel plates and friction discs will be repackaged, the requirements of 19 CFR § 134.26 do apply in this instance. CBP Regulations, 19 CFR § 134.26(a), provide in pertinent part that: “If an article subject to these requirements is intended to be repacked in retail containers (e.g. blister packs) after its release from Customs custody, or if the port director having custody of the article, has reason to believe that such article will be repacked after its release, the importer shall certify to the port director that: (1) If the importer does the repacking, he shall not obscure or conceal the country of origin marking appearing on the article, or else the new container shall be marked to indicate the country of origin of the article in accordance with the requirements of this part; or (2) if the article is intended to be sold or transferred to a subsequent purchaser or repacker, the importer shall notify such purchaser or transferee, in writing, at the time of sale or transfer, that any repacking of the article must conform to these requirements.” You state that you will comply with the requirements set forth therein by providing the requisite certification and notice to the repacker in the format provided in 19 CFR § 134.26(a) and (d), respectively. CBP ruled in Headquarters Ruling Letter HQ 560383, dated August 15, 1997, that imported automobile parts could be excepted from individual marking pursuant to 19 CFR 134.26(d), if the outer containers were properly marked with the article’s country of origin, and the port was satisfied that the ultimate purchasers would receive the parts in properly marked containers. See also HQ 562050, dated May 21, 2001. We find that the instant case is similar to prior CBP determinations: HQ 563298, dated Sep. 1, 2005, and HQ 562050, dated May 21, 2001. In this instance, the outermost container in which the subject merchandise is imported will be marked. The subject merchandise will also be sold to retail sellers and/ or installers of transmission repair kits. See also NY I84893, dated August 30, 2002. HOLDING: The steel plates and friction discs may be excepted from individual country of origin marking pursuant to the requirements of 19 CFR § 134.32, provided CBP is satisfied that there is compliance with 19 CFR § 134.26 and the ultimate purchasers will receive the subject merchandise in properly marked containers. A copy of this ruling letter should be attached to the entry documents filed at the time the subject merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs official handling the transaction. Sincerely, Ieva K. O’Rourke, Chief Tariff Classification and Marking Branch