The country of origin of network cameras

N309223 February 14, 2020 OT:RR:NC:N2:208 CATEGORY: Country of Origin Ms. Lisa Murrin Expeditors Tradewin LLC 795 Juniper Drive Peabody, Massachusetts 01960 RE: The country of origin of network cameras Dear Ms. Murrin: In your letter dated January 24, 2020, on behalf of Vivotek, Inc., you requested a country of origin ruling determination. The merchandise under consideration is two network cameras, identified as outdoor camera SKU IB8363P and indoor camera SKU IP8168W (customer’s model VS-HDP450-110 and ADC-V522IR). Both network cameras can record videos and snapshots onto an internal SD card. In addition, the subject cameras transmit video images to a location outside the camera for remote viewing or recording through VPN to the customer's backend portal. Images are saved as jpg for snapshots and mp4 for video. Outdoor Camera, SKUIB8363P, contains a main board, IR board, and POE board. The outdoor camera's main board contains the image sensor and controls all of the camera functions including video and audio capture and transmission, Wi-Fi, etc. The IR Board is used for night mode. The POE board transfers PoE 48V to 12V and is used for power. Indoor Camera, SKU IP8168W contains a main board, sensor board, and IR board. The main board controls all of the camera functions, including video, audio, Wi-Fi, etc. The sensor board contains the image sensor and is used for recording, detecting, and security. The IR Board is used for night mode. As per the information provided, the printed circuit boards are assembled in Taiwan using Surface Mount Technology (SMT), which includes mounting, soldering, and placing various components directly onto the surface of a printed circuit board (PCB). The Taiwanese factory also places and solders a few dual in-line package (“DIP”) components on the PCB. The DIP process includes board loading, flux spray, hand soldering, visual inspection, and unloading. The Taiwanese factory performs in-circuit testing on the printed circuit board assemblies (PCBAs), and then sends them to China for final assembly. The Chinese factory assembles the PCBAs, lens module, connectors and housing into the finished outdoor camera. The Chinese factory then downloads the firmware and performs functional testing. 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. 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).However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987).Based on the facts presented, it is the opinion of this office that the PCBAs that are made in Taiwan contribute to the main functionality of the finished network cameras. The complex SMT manufacturing process of the PCBAs as the placement and soldering of numerous individual components onto a bare PCB, thereby creating a functional PCBA results in a substantial transformation of the components to produce PCBAs of Taiwanese origin. Further, the assembly process performed in China, would not substantially transform the PCBAs into a new and different article of commerce with a name, character, and use distinct from that of the exported good. Accordingly, the subject network cameras would be considered a product of Taiwan 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 Lisa Cariello at lisa.a.cariello@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division