Country of origin marking of components for a storage system to be constructed in the U.S.

N244859 September 3, 2013 MAR-2-:OT:RR:NC:1:117 CATEGORY: Marking Mr. C.J. Erickson Cowan, Liebowitz & Latman, P.C. 1133 Avenue of the Americas New York, NY 10036 RE: Country of origin marking of components for a storage system to be constructed in the U.S. Dear Mr. Erickson: In your letter dated July 31, 2013, on behalf of your client ECL Solutions Ltd., you requested a country of origin marking ruling. Pictures and documentation, along with a detailed description of the components and the processing to which the parts are subjected were included in your submission. Your inquiry requested a country of origin marking exception for various steel components, including, among many other parts, beams, bars, and jointing pieces, to be imported for the construction of commercial adjustable rack and pallet storage systems by ECL at their customers’ premises. The systems are described as ranging in size from approximately 55,000 to 200,000 components, many of the components U.S. made and being incorporated into the system with the imported parts. The imported components are manufactured in various countries including China, the United Kingdom and Spain. It is stated that they will be utilized by the importer only in the construction of complex storage systems to be custom fit to their customer’s specifications at the customer’s facility and will not be sold other than under those circumstances. The complex installation requiring more than simple assembly will be accomplished only by the importer’s construction crew, typically a crew of 6 who will work over 5 weeks on site to complete the construction. The U.S. on site construction costs are stated to average over 56% of the total product cost. Since the imported components are not to be resold by ECL except as parts of the completed racking systems, you request that the foreign parts be excepted from individual marking because they are substantially transformed by operations performed by ECL, and ECL is always the ultimate purchaser of the imported components. 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. The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that 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 to 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 submitted that describes the assembly and manufacture of the racking systems produced by ECL from both foreign and U.S. components, we find that the subject components are substantially transformed into articles with a new name, character or use, when incorporated with other components to produce finished commercial adjustable rack and pallet storage systems. Accordingly, ECL is the ultimate purchaser of the parts in question.In accordance with 19 CFR 134.35, since the subject components are used by ECL in the assembly and manufacture of completed racking systems and are not sold separately in their condition as imported, they are excepted from individual marking. Only the outermost containers of the imported articles must be marked with country of origin. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 Mary Ellen Laker at (646) 733-3020. Sincerely, Myles B. Harmon Acting Director National Commodity Specialist Division