The country of origin of a watch charger

N304716 June 24, 2019 CLA-2-85:OT:RR:NC:N2:220 CATEGORY: Origin Victor Yeh Protop International Inc. 10F-8, NO. 237, SEC. 1, Datong Road Xizhi, New Taipei City 22161 Taiwan RE: The country of origin of a watch charger Dear Mr. Yeh: In your letter dated June 10, 2019 you requested a country of origin ruling on behalf of your client, Xentris Wireless. The merchandise under consideration is identified as the Watch Charger SKU: 37-0375-01-VW which is described as an electromagnetic inductive type charger consisting of an electric cable having a male USB connector on one end and the magnetic charging module on the other end. Based on the information supplied, the electric cable, USB connector, and the charging module are sourced from China and the housings, hardware, and a printed circuit board (PCB) are said to be of Vietnamese origin. You state the watch charger is assembled in Vietnam by soldering the wires onto the USB connector and the PCB. The PCB, which functions as a connector, is then attached to the magnetic charging module with solder and the various housings and overmolds are glued and fastened together to form a finished watch charger. At various stages throughout the assembly process, you indicate that testing and quality control procedures are conducted on the parts and the finished product. 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. The “country of origin” is defined in 19 CFR 134.1(b) as “the country of manufacture, production, or growth of any article of foreign origin entering the United States. 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 the meaning of this part; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin.” For tariff purposes, the courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982). Further, in Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308 (2016), the Court of International Trade (“CIT”) interpreted the meaning of “substantial transformation” as used in the Trade Agreements Act of 1979 (“TAA”) for purposes of government procurement. In Energizer the court reviewed the “name, character and use” test in determining whether a substantial transformation had occurred in determining the origin of a flashlight, and reviewed various court decisions involving substantial transformation determinations. The court noted, citing Uniroyal, Inc. v. United States, 3 C.I.T. 220, 226, 542 F. Supp. 1026, 1031, aff’d, 702 F.2d 1022 (Fed. Cir. 1983), that when “the post-importation processing consists of assembly, courts have been reluctant to find a change in character, particularly when the imported articles do not undergo a physical change.” Energizer at 1318. In addition, the court noted that “when the end-use was pre-determined at the time of importation, courts have generally not found a change in use.” Energizer at 1319, citing as an example, National Hand Tool Corp. v. United States, 16 C.I.T. 308, 310, aff’d 989 F.2d 1201 (Fed. Cir. 1993). Furthermore, courts have considered the nature of the assembly, i.e., whether it is a simple assembly or more complex, such that individual parts lose their separate identities and become integral parts of a new article. Based upon the facts presented and the pertinent authorities, it is the opinion of this office that the assembly process as described above does not result in a substantial transformation of the Chinese goods. The components themselves are not transformed in Vietnam into a new and different article of commerce with a name, character, and use distinct from the article exported. Therefore, the Watch Charger SKU: 37-0375-01-VW is considered a product of China for origin and marking purposes at the time of importation into the United States. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 Karl Moosbrugger at karl.moosbrugger@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division