The country of origin of Type C cables

N310051 March 17, 2020 CLA-2-85:OT:RR:NC:N2:212 CATEGORY: Country of Origin Fiona Pan Hank Electronics Vietnam Company Limited Number 7, Street 11 Vsip Bac Ninh Urban, Phu Chan Commune Bac Ninh Province, Vietnam Tu Son, 16353 RE: The country of origin of Type C cables Dear Ms. Pan: In your letter dated February 24, 2020, you requested a country of origin ruling on behalf of your client, Walgreens Company. The items under consideration are described as Type C cables that will be imported at lengths of 3-feet, 6-feet, 9-feet, and 10-feet. The cables are comprised of a length of insulated wire affixed at one end with a standard, male USB Type-A connector and a male USB Type-C connector at the other. The finished cables are designed to connect, charge, and sync a variety of mobile devices to host units or charging stations. In your request, you state that the cables are manufactured in Vietnam using parts of both Chinese and Vietnamese origin. The manufacturing process begins in China where the raw copper wire is drawn, extruded, twisted, and insulated to create bulk, insulated conductor cable. Then the insulated cable is inspected, tested and shipped to Vietnam for further processing. In Vietnam, the conductor is cut to the desired length and the individual wires are exposed and prepared for the addition of the connectors. Next, the Chinese origin connectors are soldered onto each end. The finished cable is then tested for function, inspected and packaged for retail sale. The “country of origin” is defined in 19 CFR 134.1(b), in pertinent part, 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.” 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, “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. Regarding the origin of the subject cables, based on the information provided it is our opinion that the Chinese origin insulated conductor imparts the essence of the finished article. The assembly process that occurs in Vietnam does not substantially transform the Chinese components into a new and different article of commerce with a name, character, and use distinct from the article exported. Based on the facts presented, it is the opinion of this office that the origin of the Type C cables is China. 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 Luke LePage at luke.lepage@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division