ENTRY PROCEDURES | 2026-10-24

Country-of-Origin Marking and the 10% "Marking Duty": How 19 U.S.C. § 1304 Catches California Importers, and How to Avoid the Penalty That Is Not a Penalty

Every imported article must tell the ultimate purchaser where it was made. When it does not, CBP can order it marked or redelivered and assess a 10% ad valorem "marking duty" under 19 U.S.C. § 1304(i) — a charge courts treat as a duty, not a penalty, so it cannot be remitted the way an ordinary fine can. For California importers, marking compliance is a front-line cost-control issue.

One of the oldest and most frequently triggered requirements in U.S. customs law is also one of the most overlooked by California importers : the rule that every article of foreign origin must be marked with its country of origin . Under 19 U.S.C. § 1304 , every imported article (or its container) m

The country-of-origin marking rules sit at the intersection of consumer protection and customs enforcement. Congress required marking so that an American buyer could learn, by looking at the article, where it was made. For importers, the rules are deceptively simple to state and surprisingly easy to violate: the marking must reach the right person (the ultimate purchaser), say the right thing (the English name of the country of origin), and survive to the point of sale (legibly and permanently). When any of those elements fails, CBP can hold or redeliver the merchandise and assess a 10% ad valorem marking duty. For a California importer moving high volumes of consumer goods, components, or private-label products, marking is not a paperwork afterthought — it is a recurring compliance and cost exposure. This article walks through the statute, the regulations, and the practical program that keeps marking problems from becoming marking duties.

The Core Requirement of § 1304

The marking statute, 19 U.S.C. § 1304, requires that every article of foreign origin (or, where the article cannot itself be marked, its container) imported into the United States be marked in a manner that is legible, indelible, and permanent enough to indicate to the ultimate purchaser the English name of the country of origin. The implementing regulations appear in 19 C.F.R. Part 134, with the general marking requirement in 19 C.F.R. § 134.11. The purpose, as CBP has long explained, is to allow the ultimate purchaser to know, by inspecting the article, the country of which the goods are the product — a consumer-information rule, not merely a revenue measure. Because the requirement attaches to essentially all foreign-origin articles, the practical questions are rarely "does marking apply" but rather "who is the ultimate purchaser," "what is the country of origin," and "is the marking adequate and permanent."

Who Is the "Ultimate Purchaser"

The marking must communicate origin to the ultimate purchaser, which the regulations generally define as the last person in the United States who will receive the article in the form in which it was imported. Identifying that person is often the decisive issue. If an imported article is sold at retail in the same form it arrived, the retail consumer is the ultimate purchaser and must be able to read the origin marking. But if a U.S. manufacturer or processor substantially transforms the imported article into a new article with a new name, character, or use, then — under 19 C.F.R. § 134.35 — that U.S. processor is the ultimate purchaser, and the imported article is excepted from individual marking (though the outermost container in which it reaches the processor must still be marked). Pinpointing the ultimate purchaser therefore turns on the same substantial-transformation analysis that governs origin determinations generally.

Determining the Country of Origin

The "country of origin" for marking purposes is the country of manufacture, production, or growth of the article. For goods made in a single country, this is straightforward. For goods assembled or processed in multiple countries, origin is determined by substantial transformation — the article's origin is the last country in which it was transformed into a product with a new name, character, or use. Simple assembly, minor finishing, or repackaging generally does not change origin, while operations that create a fundamentally different commercial article do. (For goods of certain trade-agreement partners, specific tariff-shift rules of origin can apply instead of the traditional substantial-transformation test.) Because origin drives both the marking and, often, the duty rate, importers should document the origin analysis for each product and keep it current as supply chains shift.

What Adequate Marking Looks Like

Marking must be conspicuous, legible, and permanent enough to survive normal handling and reach the ultimate purchaser. The marking must state the English name of the country of origin — abbreviations that unmistakably identify the country may be acceptable, but ambiguous or misleading markings are not. The regulations also address markings that could mislead the purchaser: if a U.S. address or a geographic location other than the country of origin appears on the article, the country-of-origin marking must appear in close proximity and in comparable size to avoid deception. Method matters too — die-stamping, molding, etching, or securely affixed labels are generally acceptable where permanent, while a mark that rubs off or is hidden by packaging is not. The common failure modes are marking that is not permanent, not conspicuous, not in English, or placed where the ultimate purchaser will never see it.

The 10% Marking Duty Under § 1304(i)

The enforcement teeth are in 19 U.S.C. § 1304(i), titled "Additional duties for failure to mark." When articles are not marked as required and are not exported or destroyed under CBP supervision before liquidation, they become subject to additional duties of 10% of the final appraised value. This marking duty is in addition to any ordinary duties and applies whether or not the article is otherwise duty-free. Crucially, courts and CBP treat the marking duty as a duty, not a penalty — it is deemed to accrue at the time of importation and is generally not remittable in the way a § 1592 penalty might be mitigated. The implementing regulation, 19 C.F.R. § 134.2, states the 10% additional duty directly. For an importer, that means the marking duty cannot be argued away on equitable grounds the way a fine sometimes can; the practical remedy is to mark or redeliver before liquidation, or to have complied in the first place.

The CF 4647 Notice to Mark or Redeliver

Marking problems usually surface through a Customs Form 4647 (Notice to Mark and/or Notice to Redeliver). When CBP finds goods unmarked or improperly marked, it issues the CF 4647 giving the importer an opportunity to properly mark the merchandise under CBP supervision, or to redeliver the goods to CBP custody. If the importer marks the goods to CBP's satisfaction (or exports or destroys them under supervision) before liquidation, the 10% marking duty can be avoided. If the importer fails to mark or redeliver, CBP may assess the marking duty and, separately, may pursue liquidated damages under the importer's customs bond for failure to redeliver. Responding promptly and completely to a CF 4647 is therefore the single most important operational step once a marking issue is identified.

Exceptions and the "J-List"

Not every article must be individually marked. Section 1304 and Part 134 contain numerous exceptions. Articles that cannot be marked without injury, that would be economically prohibitive to mark, or that reach the ultimate purchaser in a properly marked container may be excepted from individual marking, though the container generally must still be marked. There is also a statutory list of articles (historically called the "J-List") that are exempt from individual marking because of their nature — certain crude or natural products and articles incapable of being marked. And, as discussed, articles substantially transformed by a U.S. processor are excepted because the processor is the ultimate purchaser. Importers should not assume an exception applies without confirming it against the regulations and, where appropriate, a CBP ruling, because an incorrectly claimed exception leaves the goods unmarked and exposed to the duty.

Marking Versus Customs Fraud: Two Different Regimes

It is important to distinguish the marking-duty regime from the customs-fraud penalty regime under 19 U.S.C. § 1592. The marking duty under § 1304(i) is an additional duty for failing to mark, assessed without regard to intent. By contrast, intentionally removing, obliterating, or altering a country-of-origin marking to conceal origin can trigger criminal exposure under § 1304, and knowingly making false statements about origin to CBP can trigger civil penalties under § 1592. The compliance lesson is that marking is both a duty-exposure issue (the 10% charge) and, where deception is involved, a potential fraud-and-penalty issue. An importer confronting a marking problem should treat it as a compliance matter to correct promptly — never as something to paper over by altering markings, which converts a duty problem into a penalty or criminal problem.

Common Scenarios That Trip Up California Importers

Several recurring fact patterns generate marking duties. Private-label and e-commerce goods imported in bulk and repackaged domestically may lose their origin marking if the retail package is not marked. Components and sub-assemblies imported for incorporation into a finished product raise ultimate-purchaser questions — if the U.S. operation is not a substantial transformation, the imported components may still require marking to reach the true ultimate purchaser. Sets and kits combining articles of different origins require careful marking of each component's origin. Promotional giveaways and samples are often overlooked but are still subject to marking. And goods bearing a U.S. company's name or address can trigger the proximity rule requiring the country of origin to be marked nearby. Each scenario is manageable with a deliberate marking review before importation.

Building a Marking-Compliance Program

Because the marking duty is not remittable and attaches by operation of law, prevention is far cheaper than cure. A sound program includes: a product-level origin determination documented and kept current; a marking specification for each product (what text, what method, what location) built into purchase orders and supplier agreements; pre-shipment inspection so marking defects are caught abroad, not at the port; a ruling strategy that uses CBP binding rulings for close ultimate-purchaser or substantial-transformation questions; and a CF 4647 response protocol so marking notices are handled within deadlines. Importers should also train customs brokers and warehouse staff to flag marking issues. The program's goal is to ensure that every article reaches its ultimate purchaser bearing a conspicuous, permanent, English-language country-of-origin mark — the single fact that keeps § 1304(i) from applying.

Contesting a Marking-Duty Assessment

If CBP assesses a marking duty the importer believes is wrong — because the goods were in fact properly marked, were substantially transformed, fell within an exception, or were timely marked or redelivered — the importer can contest the assessment through the protest process under 19 U.S.C. § 1514, and ultimately in the Court of International Trade. Because the marking duty is treated as a duty rather than a penalty, the dispute generally proceeds through the ordinary liquidation-and-protest channel rather than a penalty-mitigation petition. Success usually depends on documentary proof: the origin analysis, photographs of the marking as imported, evidence of timely marking or redelivery, or a CBP ruling supporting the importer's position. Preserving that documentation contemporaneously is what makes a later challenge viable.

Marking Rules of Origin Under Trade Agreements

A subtlety that catches importers is that the origin determination for marking purposes is not always the traditional substantial-transformation test. For goods of certain trade-agreement partners — most importantly under the United States-Mexico-Canada Agreement (USMCA), successor to NAFTA — CBP applies a specific set of marking rules of origin based on tariff-shift criteria codified in the Customs Regulations (the NAFTA/USMCA marking rules historically found in 19 C.F.R. Part 102). Under these rules, origin for marking is determined by whether the foreign materials undergo a prescribed change in tariff classification when processed, rather than by the open-ended "new name, character, or use" inquiry. The practical consequence is that the same article can have one country of origin for marking under the Part 102 tariff-shift rules and potentially a different analysis for other purposes, so importers of goods processed in Canada or Mexico must apply the correct rule set. Using the wrong origin methodology can produce an incorrect marking — and expose the goods to the § 1304(i) marking duty — even when the importer believed it had analyzed origin correctly.

Related Guides

• California International Trade & Customs Lawyers
• ATA Carnet & Temporary Importation Under Bond
• Importer Security Filing ("ISF 10+2")

Frequently Asked Questions

What does 19 U.S.C. § 1304 require?

It requires that every imported article of foreign origin (or its container) be marked legibly, indelibly, and permanently to indicate to the ultimate purchaser in the United States the English name of the country of origin. The rules are implemented in 19 C.F.R. Part 134, with the general requirement in § 134.11.

What is the 10% marking duty?

Under 19 U.S.C. § 1304(i), articles not properly marked and not exported or destroyed under CBP supervision before liquidation are subject to additional duties of 10% of the final appraised value, on top of any ordinary duties and even if the article is otherwise duty-free. 19 C.F.R. § 134.2 implements it.

Is the marking duty a penalty I can get reduced?

Generally no. Courts and CBP treat the 10% marking duty as a duty, not a penalty — it is deemed to accrue at importation and is not remittable the way a fine might be mitigated. The practical way to avoid it is to properly mark or redeliver the goods before liquidation, or to comply before import. Call Trembach Law Firm at (213) 645-2246.

Who is the "ultimate purchaser"?

Generally the last person in the U.S. to receive the article in the form in which it was imported. If a U.S. processor substantially transforms the article into a new article with a new name, character, or use, that processor is the ultimate purchaser under 19 C.F.R. § 134.35, and the imported article is excepted from individual marking (the container must still be marked).

What is a CF 4647?

Customs Form 4647 is CBP's Notice to Mark and/or Redeliver. When goods are found unmarked or improperly marked, CBP issues it to give the importer a chance to properly mark the merchandise under supervision or redeliver it to CBP. Marking or redelivering before liquidation can avoid the 10% duty; failing to can lead to the duty and bond liquidated damages.

How is the country of origin determined?

It is the country of manufacture, production, or growth. For goods processed in multiple countries, origin is the last country where the article was substantially transformed into a product with a new name, character, or use. Simple assembly or repackaging usually does not change origin. Certain trade-agreement goods use specific tariff-shift rules instead.

Are there exceptions to individual marking?

Yes. Articles that cannot be marked without injury or at prohibitive expense, articles reaching the ultimate purchaser in a marked container, statutory "J-List" articles incapable of marking, and articles substantially transformed by a U.S. processor may be excepted from individual marking — though containers often must still be marked. Confirm any exception against Part 134 and, if close, a CBP ruling.

What should a California importer do to avoid marking duties?

Document a product-level origin determination, build a marking specification into purchase orders, inspect pre-shipment, use CBP binding rulings for close questions, and have a CF 4647 response protocol. Prevention is far cheaper because the marking duty is not remittable. Call Trembach Law Firm at (213) 645-2246.

Talk to a California Customs Lawyer About Marking Compliance

If CBP has issued a marking notice, demanded redelivery, or assessed a 10% marking duty on your imports, the stakes are real because that duty is not remittable like a penalty. Trembach Law Firm, led by Anatolii Trembach (LL.M.; admitted in California), advises importers on country-of-origin marking under 19 U.S.C. § 1304 and 19 C.F.R. Part 134, responds to CF 4647 notices, contests marking-duty assessments, and builds compliance programs that keep the duty off your entries. Call (213) 645-2246 for a confidential consultation.

Contact Trembach Law Firm at (818) 514-7680 for a confidential consultation.

Trembach Law Firm | 27001 Agoura Road, Suite 350, Calabasas, CA 91301