The country of origin and application of Section 301 remedies to five pieces of jewelry.

N306487 October 25, 2019 CLA-2-71:OT:RR:NC:N4:463 CATEGORY: Country of Origin Arthur W. Bodek GDLSK LLP 599 Lexington Avenue, 36th FL New York, NY 10022-7648 RE: The country of origin and application of Section 301 remedies to five pieces of jewelry. Dear Mr. Bodek: In your letter dated September 25, 2019, on behalf of your client, David Yurman Enterprises LLC, you requested confirmation that the articles are country of origin Italy and not subject to China Section 301 duties. We received literature, pictures, diagrams and cost data. Per the literature and other information provided, the five (5) jewelry items that are the subject of this ruling request are made from gold and set with diamonds. Descriptions of the five (5) jewelry items immediately follow: SKU WR3066 PLADI6: Three Row Wedding Band SKU E14837D88ADI: XL Pave Starburst Earring SKU B13026D88ADIM: 4MM Stax Single Row Chain Link Bracelet SKU N14271D8WAD: 5.0MM Paveflex 1-Row Cable Necklace SKU B14271D88ADIM: 5MM Paveflex 1-Row Bracelet You state that the sourcing and manufacturing process is the same for all five (5) aforementioned articles of gold jewelry with diamonds, as follows: To produce the jewelry items, David Yurman USA creates the jewelry designs and places a purchase order with a supplier in Italy. The castings are produced in Italy with gold purchased in Italy. Diamonds sourced from India are sent to Italy. In Italy, production envelopes are packed with the gold castings, diamonds, and all components used to create the finished jewelry articles. The production envelopes are shipped from Italy to China. The processor in China sets the stones onto the casting and polishes the jewelry before returning the articles to Italy. In Italy, the supplier inspects the articles and executes the finishing steps, including engraving and rhodium plating. After inspection, the supplier packs and ships the articles to the U.S. COUNTRY OF ORIGIN AND CHINA SECTION 301 APPLICABILITY U.S. Customs and Border Protection (CBP) regulation, 19 CFR 134.1(b), defines “country of origin” 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. The courts have long 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. A substantial transformation will not result from a minor manufacturing or combining process that leaves the identity of the article intact. U.S. v. Gibson-Thomsen CO., 27 C.C.P.A. 267 (1940). CBP has consistently found that mounting or setting articles of jewelry is a simple combining operation that does not amount to a substantial transformation. For example, in HQ 555801, January 2, 1991, CBP determined that mounting a gemstone onto a ring casting is a simple combining operation. In N248127, December 12, 2013, CBP found that “The mounting of a gemstone onto a ring is considered a simple combining operation, and is not, in and of itself a substantial transformation.” In determining country of origin for purposes of trade remedy cases, the standard to be applied is substantial transformation. CBP has explicitly applied the same traditional substantial transformation analysis in the context of Section 301 duties. In HQ H303280 CBP ruled, “When determining the country of origin for purposes of applying current trade remedies under Section 301, the substantial transformation analysis is applicable.” The Section 301 statute, the United States Trade Representative (USTR) action thereunder, and CBP’s interpretation of such action, all reflect that the current China Section 301 duties apply only to “products of China.” In the instant case, the aforementioned production performed in Italy constitute a substantial transformation, rendering Italy the country of origin of the jewelry articles and the subsequent processing performed in China is considered a simple combining operation. Therefore, for the reasons discussed above, the five (5) finished articles of jewelry, subject of this ruling, are “products of Italy” and are not subject to China Section 301 trade remedy duties. 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 Seth Mazze at seth.mazze@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division