[Federal Register Volume 60, Number 66 (Thursday, April 6, 1995)]
[Notices]
[Pages 17607-17609]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-8454]



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DEPARTMENT OF THE TREASURY
[T.D. 95-25]


Country of Origin Marking of Products From the West Bank and Gaza

AGENCY: U.S. Customs Service, Department of Treasury.

ACTION: Notice of Policy.

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SUMMARY: This document notifies the public that, for country of origin 
marking purposes, goods which are produced in the West Bank and Gaza 
Strip shall be properly marked as ``West Bank,'' ``Gaza'' or ``Gaza 
Strip'' and shall not contain the words ``Israel,'' ``Made in Israel,'' 
``Occupied Territories-Israel,'' or words of similar meaning.

EFFECTIVE DATE: For those persons whose ruling is revoked, the position 
set forth in this document is effective for merchandise entered or 
withdrawn from warehouse for consumption on or after June 19, 1995; for 
all other persons, this document is effective on April 6, 1995.

FOR FURTHER INFORMATION CONTACT: Wende Schuster, Special Classification 
and Marking Branch (202) 482-6980.

SUPPLEMENTARY INFORMATION:

Background

    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 U.S. the English name of the country 
of origin of the article. Failure to mark an article in accordance with 
the requirements of 19 U.S.C. 1304 shall result in the levy of a duty 
of ten percent ad valorem. Part 134, Customs Regulations (19 CFR Part 
134), implements the country of origin marking requirements and 
exceptions of 19 U.S.C. 1304.

Past Policy

    In the past, Customs has taken the position that in order for the 
country of origin marking of a good which is produced in the West Bank 
or Gaza Strip to be considered acceptable, it must be marked with the 
words ``Israel,'' ``Product of Israel,'' or ``Israeli-Occupied West 
Bank (or Gaza),'' or words of similar meaning. In all such instances, 
Customs required that the word ``Israel'' must appear in the marking 
designation. For instance, in HRL 718329 dated December 21, 1981, 
Customs held that it is acceptable to mark goods which were produced on 
the West Bank of the Jordan River with the phrase ``Israeli-Occupied 
West Bank,'' ``Made in Israel,'' or ``Israel'' and to indicate such 
marking designation on the Certificate of Origin Form A for purposes of 
the Generalized System of Preferences (GSP). In another case concerning 
goods produced on the West Bank of the Jordan River (HRL 718125 dated 
November 12, 1981), Customs held that these goods must be marked with 
the designators ``Israeli-Occupied West Bank'', ``Made in Israel'', or 
``Israel'' for purposes of indicating the country of origin of the 
merchandise pursuant to 19 U.S.C. 1304. In addition, in HRL 730094 
dated January 30, 1987, Customs held that the proper country of origin 
marking designation for soap which is produced in the West Bank is 
``Israeli-occupied West Bank'' or simply ``Israel''. Finally, in HRL 
734609 dated May 26, 1992, which concerned the [[Page 17608]] proper 
country of origin marking of fruits and vegetables imported into the 
U.S. from the Gaza Strip, Customs held that the designation ``West 
Bank'' is not an acceptable country of origin marking because the 
United States does not recognize the West Bank territory as an 
independent political entity. Consequently, Customs stated in HRL 
734609 that as the Gaza Strip has a similar status as the West Bank, 
the country of origin markings, ``Israel-Occupied Gaza,'' ``Made in 
Israel,'' or ``Israel'' but not simply the word ``Gaza'' can be used on 
goods which are produced in Gaza.

Recognition of West Bank and Gaza Strip

    The Department of State has advised that in accordance with the 
Israeli-PLO Declaration of Principles on Interim Self-Government 
Arrangements (``the DOP''), which was signed in Washington, D.C. on 
September 13, 1993, Israel has agreed to transfer certain powers and 
responsibilities to the Palestinian Authority. Under this Agreement, 
Israel has also consented to make a similar transfer to a superseding, 
elected Palestinian Council, as part of interim self-governing 
arrangements in the West Bank and Gaza Strip. As part of this 
Agreement, the Palestinian Authority has agreed to administer its own 
tariff revenue collection and other customs matters. The Palestinian 
Authority also acceded to set its own tax policy under the terms of an 
implementing agreement which was concluded in Cairo on May 4, 1994. In 
view of these recent developments, the U.S. Department of the State has 
advised the U.S. Department of the Treasury by letter dated October 24, 
1994, that, in their view, the primary purpose of 19 U.S.C. 1304 would 
be best served if goods which are produced in the West Bank and Gaza 
Strip are permitted to be marked ``West Bank'' or ``Gaza Strip.'' The 
Department of State believes that labeling goods as coming from the 
``West Bank'' or ``Gaza'' will provide American purchasers with 
important information indicating their origin, which is the primary 
purpose of 19 U.S.C. 1304.

Reliance Upon Advice From State Department

    Customs has previously relied upon advice received from the U.S. 
Department of State in making determinations regarding the ``country of 
origin'' of a good for marking purposes. In T.D. 49743 dated November 
10, 1938, the question was whether products imported from German-
occupied territories were regarded as products of Germany for the 
purposes of the marking provisions of the Tariff Act of 1930, and for 
determining applicable rates of duty. Based upon instructions given by 
the U.S. Department of State, Customs held that as a result of a change 
in jurisdiction from Czechoslovak to German in the Sudeten areas which 
were under German occupation, products which were manufactured in those 
areas and were exported on or after the date of German occupation were 
considered products of Germany for purposes of country of origin 
marking.
    In United States v. Friedlaender & Co., Inc., C.C.P.A. (February 
26, 1940), the issue involved the proper country of origin marking of 
imported merchandise which was wholly manufactured in Czechoslovakia, 
except at the time the goods were exported, the territory in which the 
goods were manufactured was under German occupation. Customs held that 
marking the goods as products of Czechoslovakia was not acceptable, 
based upon instructions set forth in T.D. 49743. The court agreed with 
Customs and held that as the goods were exported at a time when that 
part of Czechoslovakia in which the goods were manufactured was under 
German occupation, the marking ``Czechoslovakia'' was not in compliance 
with the requirements of the marking statute, and the goods should be 
marked to indicate ``Germany'' as the country of origin. However, in a 
later Treasury Decision (T.D. 51360 dated November 30, 1945), the 
position taken by Customs in T.D. 49743 was rescinded. In T.D. 51360, 
Customs stated that the U.S. Department of State advised that the 
boundaries of Czechoslovakia had been reestablished as they existed 
prior to the date of the occupation by Germany, and that the United 
States recognized Czechoslovakia as an independent state. Based upon 
this information, Customs reversed the position taken in T.D. 49743, 
and concluded that articles which were manufactured or produced in 
Czechoslovakia after May 8, 1945, should be regarded as products of 
Czechoslovakia for purposes of the marking provisions of the Tariff Act 
of 1930.
    Accordingly, consistent with prior Customs decisions, Customs is 
relying upon advice from the Department of State for purposes of 
defining the term ``Country'' within the meaning of section 134.1(a), 
Customs Regulations (19 CFR 134.1(a)).

Revocation of Prior Rulings

    On November 23, 1994, Customs issued telex 6327071, which stated 
that Customs was proposing to change its position regarding the country 
of origin marking requirements for goods made in the West Bank and Gaza 
Strip. In the telex, Customs stated that effective immediately 
merchandise which is produced in the West Bank or Gaza Strip may be 
properly marked with the words ``West Bank,'' ``Gaza,'' or ``Gaza 
Strip,'' without the words ``Israel,'' ``Product of Israel,'' or 
``Israeli-Occupied West Bank,'' or words of similar meaning, also 
appearing in the marking designation. The telex further stated that 
Customs would publish a notice in the Customs Bulletin requesting 
public comment on the modification or revocation of prior rulings 
concerning this matter. However, it was further noted in the telex that 
until such modification or revocation is effected, the prior rulings 
concerning the proper marking of goods made in the West Bank or Gaza 
Strip would remain valid and goods may continue to be marked in 
accordance with them.
    On February 8, 1995, Customs published a notice in the Customs 
Bulletin (Volume 29, Number 6), proposing to revoke Headquarters Ruling 
Letters (HRLs) 718329, 718125, 730094, and 734609, to reflect the 
position that goods which are produced in the West Bank or Gaza Strip 
shall be regarded as a product of the West Bank or Gaza Strip in 
accordance with the requirements of 19 U.S.C. 1304 and 19 CFR Part 134, 
and shall be marked as ``West Bank,'' ``Gaza'' or ``Gaza Strip,'' and 
shall not contain the words ``Israel,'' ``Made in Israel,'' ``Occupied 
Territories-Israel,'' or words of similar meaning.
    Two comments received in response to the February 8, 1995, Customs 
Bulletin notice both of which were favorable to the Customs proposal. 
One commenter, however, suggested that Customs expand the proposed 
position by allowing goods which are produced in the West Bank or Gaza 
Strip to be marked as ``West Bank,'' ``Gaza,'' ``Palestine,'' ``West 
Bank, Palestine,'' or ``Gaza, Palestine.'' The U.S. Department of State 
has not identified the area within the West Bank or Gaza Strip as one 
that should be recognized as ``Palestine.'' Therefore, articles which 
are produced in the West Bank or Gaza Strip may not be marked as 
products of ``Palestine.''

New Position

    This document notifies the public that unless excepted from 
marking, goods [[Page 17609]] which are produced in the territorial 
areas known as the West Bank or Gaza Strip shall be marked as ``West 
Bank,'' ``Gaza,'' or ``Gaza Strip'' in accordance with the requirements 
of 19 U.S.C. 1304 and 19 CFR Part 134, and shall not contain the words 
``Israel,'' ``Made in Israel,'' ``Occupied Territories-Israel,'' or 
words of similar meaning. This document also revokes prior ruling 
letters (HRL's 718329, 718125, 730094, and 734609) regarding the 
country of origin marking requirements for goods which are produced in 
the West Bank and Gaza Strip. For those persons whose ruling is 
revoked, the position stated in this document is effective for 
merchandise which is entered or withdrawn from warehouse for 
consumption on or after 60 days from the date this document is 
published in the Customs Bulletin; for all other persons, this document 
is effective on the date of publication in the Federal Register.


    Dated: April 3, 1995.
Stuart P. Seidel,
Assistant Commissioner, Office of Regulations and Rulings.
[FR Doc. 95-8454 Filed 4-5-95; 8:45 am]
BILLING CODE 4820-02-P