Country of origin marking requirements for integrated circuits

HQ 731021 June 24, 1988 MAR-2-05 CO:R:C:V 731021 lw Category: Marking Mr. Nicholas F. Coward Baker & McKenzie 815 Connecticut Avenue, N.W. Washington, D.C. 20006-4078 RE: Country of origin marking requirements for integrated circuits Dear Mr. Coward: This is in response to a letter dated January 19, 1988, from Stephen P. Beven, Manager of the Customs and Export Licensing Administration for Advanced Micro Devices, Inc., ("the importer") and to your letter dated May 18, 1988, in which you confirm your representation of the importer. Your client manufactures integrated circuits in the Philippines, and wishes to use an alternative country of origin marking on some of its circuits. FACTS: The importer wishes to mark the integrated circuits ("IC's") with the abbreviation "PHIL" as an alternative country of origin marking to "PHILIPPINES". In support of its position the importer states that a competitor has been importing IC's made in the Philippines using the abbreviation "PHIL" to designate the country of origin (you submitted a sample of what you claim to be a competitor's product). In addition, the importer claims that the following factors are relevant to our determination concerning the abbreviation "PHIL": 1) the IC's are very small; often measuring less than an inch in length and 1/4 inch wide; 2) the plastic rails or carriers which the IC's must be shipped in obscure the marking on the IC; 3) the IC's are sold mainly to manufacturers who realize that the majority of IC's of American companies are made from U.S. fabricated die but are assembled in non-U.S. locations, while the retail market is very small; 4) Manufacturers know where the marking on IC's is usually found and, because IC's are made in three or four common locations, would recognize "PHIL" as the abbreviation for Philippines; 5) Although the IC's originate in the Philippines according to U.S. Customs Service definitions, they are essentially a U.S. product. LAW AND ANALYSIS: Section 134.45(a), Customs Regulations (19 CFR 134.45(a)), provides that the required markings shall include the English name of the country of origin, unless other marking to indicate - 2 - the English name of the country of origin is specifically authorized by the Commissioner of Customs. Notice of acceptable markings other than the English name of the country of origin shall be published in the "Federal Register" and the "Customs Bulletin." Section 134.45(b) states that abbreviations which unmistakenly indicate the name of a country are acceptable. Customs has previously ruled that the abbreviation "PHIL" to designate the country of origin of IC's manufactured in Manila, Philippines, was not acceptable because it did not unmistakenly indicate the name of the country of origin in accordance with 19 CFR 134.45(b) (727843 LR; July 3, 1985). In that ruling it was suggested that the word PHILIPPINES be hyphenated and placed on two lines, printed in smaller letters, or written as PHILIPNES, to accommodate the marking to a small space. The fact that a competitor has been importing IC's using the abbreviation "PHIL" is not a determining factor in this case. However, because the competitor's IC is not properly marked, by copy of this letter we are forwarding your information to the Office of Commercial Fraud, U.S. Customs Service, 1301 Constitution Avenue, N.W., Room B102, Washington, D.C. 20229, for further investigation and appropriate action. Further information you may have regarding the importation of these IC's may be provided directly to that office. With regard to the importer's claim that the small size of the IC prohibits marking the country of origin as "PHILIPPINES," as suggested in Ruling 727843, the print size can be reduced or "PHILIPPINES" can be hyphenated, or written as "PHILIPNES." In response to the second point raised by the importer, country of origin marking regulations are in part directed at concern that the ultimate purchaser be made aware of the country of origin of an imported article. Therefore, as long as the ultimate purchaser can be unmistakenly informed as to the country of origin, the fact that the marking may be obscured during shipment is irrelevant. In addition, the importer claims that IC's are purchased mainly by manufacturers who realize that the Philippines is one of three or four of the most common locations in the world for assembly of IC's,and thus would recognize "PHIL" as an abbreviation for the Philippines. Further, the manufacturers also know where the country of origin marking is found. It is our opinion that because manufacturers are not the only buyers of IC's, and because there is a retail market, the country of origin must still be marked so that the ultimate purchaser will be able to unmistakenly identify the name of the country of origin. - 3 - Finally, the last issue raised by the importer, that the IC's are essentially a U.S. product, addresses the question of the country of origin of the article rather than the manner in which it should be marked. Inasmuch as it has been determined that the IC's are a product of the Philippines, they must be marked as such. HOLDING: Based on the above considerations, and after examination of the sample submitted, we are of the opinion that the factors raised by the importer as relevant in considering the acceptability of "PHIL" are not convincing. The abbreviation "PHIL" is not acceptable because it does not unmistakenly designate the country of origin. In accordance with our long- standing position, we believe that "PHIL" does not comply with 19 CFR 134.45(b). Therefore, the IC's must either be marked "PHILIPPINES," or by one of the alternative acceptable methods suggested. Sincerely, Marvin M. Amernick Chief, Value, Special Programs and Admissibility Branch cc: Irwin Josephs, NIS 1cc: CLA-2 CO:R:C:V:LWEDDELL:LDC:6/22/88 Mr. Nicholas F. Coward Baker & McKenzie 815 Connecticut Avenue, N.W. Washington, D.C. 20006-4078