Country of Origin Marking of Slinky Boxes

N190267 November 15, 2011 MAR-2 OT:RR:NC:N4:424 CATEGORY: MARKING Ms. Karen Cobb Coppersmith Global Logistics 760 Bonnie Lane Elk Grove Village, IL 60007 RE: Country of Origin Marking of Slinky Boxes Dear Ms. Cobb: This is in response to your letter dated October 24, 2011, on behalf of Poof-Slinky Inc., requesting a ruling on the proper country of origin marking of Slinky paperboard boxes commemorating the 50th anniversary of the well-known Slinky jingle next year. Currently, the Slinky toy and its retail packaging are made in the United States. A photograph of the Slinky’s retail packaging paperboard box was submitted with your letter showing an American Flag surrounded with the phrase “Made in the U.S.A.” on the box’s top left hand corner. In your request, you asked for the proper country of origin marking for two scenarios. In the first, the Slinky and paperboard box will continue to be made in the U.S. but the sound module for the song will be made in China. These sound modules will be sent in bulk in a protective sleeve or polybag. It will be installed and properly positioned in the box in the U.S. When the Slinky box is opened, a trigger activates the sound module causing it to play the 15 to 20 second jingle. You state that the sound module will not work once removed from the paperboard box. The second scenario states that the Slinky will be made in the U.S. while the box and the sound chip will both be made in China. In this scenario the sound module will already be packaged inside the retail package. In both cases, Poof-Slinky is the ultimate purchaser of the boxes/sound modules upon importation from China. You ask whether Poof-Slinky’s retail paperboard box may continue to contain the American flag with the phrase “Made in the U.S.A.” marking and whether they must indicate the sound module and packaging as “Made in China.” It must be noted, if a good is determined to be an article of U.S. origin, it is not subject to the country of origin marking requirements of 19 U.S.C. §1304. 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). We suggest that you contact the FTC Division of Enforcement, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is made in the U.S. Therefore, this ruling does not address the applicability as to whether the marking of “Made in the U.S.A.” is properly shown for the Slinky. As for your first scenario listed above, as to whether the origin of the sound module should be notated on the retail packaging when sent in bulk, 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 U.S.C. 1304. Section 134.41(b), Customs Regulations (19 CFR 134.41(b)), mandates that the ultimate purchaser in the U.S. must be able to find the marking easily and read it without strain. 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 he 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. In such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked. See, 19 CFR 134.35.In this case, the imported sound modules lose their separate identity once they are incorporated into the retail packaging in the U.S. and they are substantially transformed as a result of the U.S. processing. Being that Poof-Slinky is the ultimate purchaser of the imported sound module, under 19 CFR 134.35 only the containers which reach the ultimate purchaser are required to be marked with the country of origin "Made in China." It is not necessary to mark the paperboard retail boxes. As for the second scenario, Section 134.24(b), Customs Regulations [19 C.F.R. §134.24(b)], provides that disposable containers, not designed or capable of reuse, which are imported empty and packed and sold in multiple units, need not be individually marked with the country of origin. The marking requirements may be met by marking the outermost container that reaches the ultimate purchaser. Again, Poof-Slinky is considered to be the ultimate purchaser who will package the Slinky toy in the empty paperboard boxes in the U.S. upon importation. Therefore, the Slinky box may be excepted from individual marking provided the shipping containers in which they are imported are marked to indicate the country of origin of the boxes and the Customs officers at the port of entry are satisfied that the shipping containers will reach the ultimate purchaser unopened. 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 James Forkan at (646) 733-3025. Sincerely, Robert B. Swierupski Director National Commodity Specialist Division