The country of origin of Type C cables

N312250 June 16, 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, industrial and space area Phu Chan Commune, Tu Son Town, 16353 Bac Ninh Province, Vietnam RE: The country of origin of Type C cables Dear Ms. Pan: In your letter dated June 04, 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. The subject cable is comprised of a 3-foot 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 illustrate the following manufacturing process as occurring in Vietnam. The process begins with Vietnamese originating copper wire being drawn, twisted, stranded, jacketed, and extruded. The wire is then insulated with material sourced from China. Once the wire is cut to the desired length, the Chinese origin connectors are then soldered to 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, it is our opinion that the Vietnamese origin conductor imparts the essential functional component of the finished article. The addition of the Chinese origin parts and material does not substantially transform the article into a new and different article of commerce with a name, character and use distinct from the individual components. Based on the facts presented, it is the opinion of this office that the origin of the Type C cables is Vietnam. 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