Country of Origin Marking of Imported Cable Assemblies from Mexico; Article 509

N253394 June 4, 2014 CLA-2-85:OT:RR:NC:N1:112 CATEGORY: Marking Bruce H. Leeds, Attorney Braumiller Law Group 5220 Spring Valley Road Suite 200 Dallas, TX 75254 RE: Country of Origin Marking of Imported Cable Assemblies from Mexico; Article 509 Dear Mr. Leeds: In your letter dated May 11, 2014, you requested a ruling on the country of origin marking requirements for an imported article which is processed in a NAFTA country prior to being imported into the U.S. on behalf of your client, Teledyne Cable Solutions. A marked sample was not submitted with your letter for review. The item(s) concerned are electrical cable assemblies. They are used to provide interconnections in electrical assemblies and systems. The cable assemblies are comprised of electrical cable, heat shrink tubing, J1/J2 connectors with retainers, wire rope, a double ear clamp, a protective cap, an oval sleeve, and a polyurethane compound. All the components are manufactured in the United States and exported to Mexico for assembly into electrical cable assemblies. In Mexico, the assembler adds solder, heat shrink, wire rope, and identification labels as part of the assembly. The fabrication process consists of the wires having the insulation stripped from their ends and individually soldered to the connectors. Heat shrink tubing sleeves are added to the exposed ends of the wires and the drain wire. The connectors are secured to the cable by threading the retainers and tightening in place and then are encapsulated with polyurethane insulation. The protective cap is assembled to the cable assembly by mechanical crimping to the wire rope and identification labels are added to the cable assembly to complete the process. 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. The country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the North American Free Trade Agreement ("NAFTA"), as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat 2057) (December 8, 1993) and the appropriate Customs Regulations. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. The marking requirements of these goods are set forth in Part 134, Customs Regulations. Section 134.1(b) of the regulations, defines "country of origin" as the country of manufacture, production, or growth of any article of foreign origin entering the U.S. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin" within this part; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin. (Emphasis added). Section 134.1(j) of the regulations, provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) of the regulations, defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules. Section 134.45(a)(2) of the regulations, provides that a "good of a NAFTA country" may be marked with the name of the country of origin in English, French or Spanish. You state that the imported cable assemblies are processed in a NAFTA country "Mexico" prior to being imported into the U.S. Since Mexico is defined under 19 CFR 134.1(g), as a NAFTA country, we must first apply the NAFTA Marking Rules in order to determine whether the imported cable assemblies are a "good of a NAFTA country", and thus subject to the NAFTA marking requirements. Part 102 of the regulations, sets forth the "NAFTA Marking Rules" for purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 of the regulations, sets forth the required hierarchy for determining country of origin for marking purposes. Based on the information provided, neither 19 C.F.R. 102.11 (a) (1) or 102.11 (a) (2) may be used to determine the origin of the finished article so analysis must continue to 19 C.F.R. 102.11 (a) (3). Pursuant to 19 C.F.R. 102.11 (a) (3), the country of origin of a good is the country in which each foreign material incorporated in that good undergoes an applicable change in tariff classification as set forth in 19 C.F.R. 102.20, and satisfies any other applicable requirements of that section. In this case the cable assemblies imported into the United States from Mexico are classified under subheading 8544.42.9000, Harmonized Tariff Schedule of the United States (HTSUS), the change in tariff must be made in accordance with section 102.20(o), Section XVI: Chapters 84 through 85, heading 8544.11-8544.70, HTSUS, which requires “A change to subheading 8544.11 through 8544.70 from any other subheading, including another subheading within that group, except when resulting from simple assembly.” The cable assemblies in question are comprised of 5 components, which are assembled in Mexico. Simple assembly is defined in C.F.R. 102.1 (o) as “…the fitting together of five or fewer parts all of which are foreign (excluding fasteners such as screws, bolts, etc.) by bolting, gluing, soldering, sewing or by other means without more than minor processing.” As such we find that the processing that takes place in Mexico is a “simple assembly” process, thus the country of origin of the cable assemblies may not be determined in accordance with this provision. Since 19 C.F.R. 102.11(a) (incorporating section 102.20), is not determinative of origin, the next step is section 102.11(b), Customs Regulations, which states, in part: Except for a good that is specifically described in the Harmonized Tariff Schedule as a set, or is classified as a set pursuant to General Rule of Interpretation 3, where the country of origin cannot be determined under paragraph (a) of this section: The country of origin of the good is the country or countries of the single material that imparts the essential charter to the good, … Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that the imported cable assembly is not a good of Mexico for marking purposes. Based upon the above factors, we find that the electrical cable SPD-22871 is the single component that imparts the essential character to the imported cable assembly. Accordingly, the country of origin of the finished cable assemblies, pursuant to section 102.11(b) (1) of the Customs Regulations, is the United States. 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, regarding the propriety of marking the turbine generator, indicating that it was made in the U.S. This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181). 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 Karl Moosbrugger at Karl.Moosbrugger@CBP.DHS.GOV. Sincerely, Gwenn Klein Kirschner Acting Director National Commodity Specialist Division