HQ 225332: Importer of record; 19 U.S.C. 1484; owner or purchaser; buyingagent; C.D. 3530-02.

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 225332

                         October 12, 1994

ENT-1-01-CO:R:C:E 225332 AJS

CATEGORY: Entry

Mr. John A. Bessich
Gibney, Anthony & Flaherty
665 Fifth Avenue
New York, NY 10022-5305

RE: Importer of record; 19 U.S.C. 1484; owner or purchaser; buying
agent; C.D. 3530-02. 

Dear Mr. Bessich:

     This is in reply to your letter of April 11, 1994, concerning
Mats Marketing Corp. (MMC) and the right to make entry.

FACTS:

     MMC is a corporation which has been formed for the purpose of
acting as an intermediary between U.S.-based wholesale purchasers
of various kinds of fresh-cut flowers and the foreign based farms
which supply such flowers.  Specifically, MMC will enter into
written buying agreements with various U.S. flower wholesalers,
wherein MMC will act as their agent for the purchase, shipment,
clearance and delivery in the U.S. of fresh cut-cut flowers from
foreign suppliers.  In all cases, MMC will act solely as agent for
each U.S. purchaser, will not act as a reseller, and will not be
related to or execute agreements with any of the foreign suppliers
to which it transmits orders.  Pursuant to these agreements, U.S.
wholesalers will place their orders for fresh-cut flowers with
foreign suppliers through MMC.  Following the receipt of a number
of these orders, MMC will transmit orders to the foreign suppliers
on behalf of, and as agent for, each U.S. wholesaler.  In this
regard, MMC will be subject expressly to the direction of the U.S.-
based wholesalers and will transmit orders only in accordance with
their instructions.  Approval as to pricing, delivery and any other
terms will rest with U.S. wholesalers, as principals.

     Upon receipt of orders from MMC, foreign suppliers will
prepare individual invoices to the various U.S. wholesalers, in
care of MMC.  In accordance with what you claim is customary
practice followed in the flower trade, the supplier invoices will
not specify prices, but will clearly indicate that the transactions
are consignment sales.  (Upon sale by each wholesaler in the U.S., 


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a portion of the sales price is returned to the foreign supplier). 
MMC will arrange to consolidate the various shipments under one air
waybill.  At time of arrival in the U.S., MMC will file entry in
its own name as importer of record for the consolidated shipment,
as agent for the U.S. wholesaler, using the services of a licensed
customs broker.  (You claim that for purposes of entering fresh-cut
flowers shipped under consignment, market prices are generally
shown on entry papers and, if required by the responsible import
specialists, consignment reports are subsequently furnished which
disclose the prices at which the flowers were sold in the U.S.).  

ISSUE:

     Whether MMC has the right to make entry in its own name as the
importer of record.

LAW AND ANALYSIS:

     Section 484, Tariff Act of 1930, as amended, (19 U.S.C. 1484) 
provides that the "importer of record" has the right to make entry. 
The "importer of record" is defined in section 1484(a)(2)(B), as
the owner or purchaser of the goods, or when designated by the
owner, purchaser, or consignee, a licensed customhouse broker. 
Customs Directive 3530-02, dated November 6, 1984, clarifies and
explains the right to make entry.  In this directive, "owner or
purchaser" is defined to be "any party with a financial interest in
a transaction, including, but not limited to, the actual owner of
the goods, the actual purchaser of the goods, a buying or selling
agent, a person or firm who imports on consignment . . ."  

     The existence of a bona fide buying agency depends upon the
relevant factors of the individual case.  J.C. Penney Purchasing
Corp. v. United States, 451 F. Supp. 973, 983 (Cust. Ct. 1978). 
The importer has the burden of proving the existence of a bona fide
agency relationship.  Rosenthal-Netter, Inc. v. United States, 679
F. Supp. 21, 23, 12 CIT 77, 78 (1988); New Trends, Inc. v. United
States, 65 F. Supp. 957, 960, 10 CIT 637 (1986).

     In determining whether an agency relationship exists, the
primary consideration is the right of the principal to control the
agent's conduct with respect to those matters entrusted to the
agent.  J.C. Penney, 451 F. Supp. 973, 983.  The existence of a
buying agency agreement has been viewed as supporting the existence
of a buying agency relationship.  Dorco Imports v. United States,
67 Cust. Ct. 503, 512, R.D. 11753 (1971).  In addition, the courts
have examined such factors as: whether the purported agent's 
actions were primarily for the benefit of the principal; whether
the principal or the agent was responsible for the shipping and
handling and the costs thereof; whether the importer could have
purchased directly from the manufacturers without employing an
agent; whether the intermediary was operating an independent 


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business, primarily for its own benefit; and whether the purported
agent was financially detached from the manufacturer of the
merchandise.  Rosenthal-Netter, 679 F. Supp. 21, 23 (1988); New
trends, 645 F. Supp. 957, 960-62.

     In the instant case, MMC will enter into agreements with U.S.
flower wholesalers for whom they will act as agent in the purchase,
shipment, clearance and delivery of fresh-cut flowers to be sold on
consignment.  The wholesalers will order merchandise through MMC
which will then place the orders with foreign suppliers.  MMC will
be subject to the express direction of the wholesalers and will
place orders only upon their instructions.  Approval of pricing,
delivery and any other terms will rest with the wholesalers who
will also bear all shipping costs.  MMC will act solely as agent
for each U.S. wholesaler and will not act as a seller of the
imported merchandise, nor will it be related to any of the foreign
sellers.  MMC intends to enter into written buying agency 
agreements with each U.S. wholesaler; however, the agreements have
not yet been negotiated.

     In return for its services MMC will receive a one percent
commission based on the amounts returned to the foreign suppliers
by the wholesalers.  MMC will issue its own invoice for commissions
to each U.S. wholesaler it represents.  Finally, MMC will not
receive compensation from any foreign suppliers.  

     In light of the information presented we consider MMC to be a
bona fide buying agent.  As such, MMC possesses a sufficient
financial interest in the subject transactions to entitle it to
file entry as the importer of record.  For appraisement purposes,
however, please note that the existence of a buying agency
relationship is factually specific.  Moreover, the actual
determination as to the existence of a buying agency will be made
by the appraising officer at the applicable port of entry and will
be based on the entry documentation submitted.  The totality of the
evidence must therefore demonstrate that the purported agent is in
fact a bona fide buying agent and not a selling agent nor an
independent seller.  See 23 Cust. B. & Dec., No. 11, General Notice
dated march 15, 1989 at 9; HRL 542141. 

HOLDING:

     MMC is a buying agent and, therefore, it has sufficient
financial interest in the subject transactions to entitle it to
file entry as the importer of record.


                                 Sincerely,


                                 John Durant, Director
                                 Commercial Rulings Division