The country of origin of a wallet

N312724 July 23, 2020 CLA-2-42:OT:RR:NC:N4:441 CATEGORY: Country of origin Mr. John McLoughlin KPMG LLP 1601 Market Street Philadelphia, PA 19103 RE: The country of origin of a wallet Dear Mr. McLoughlin: In your letter dated June 23, 2020, you requested a country of origin ruling on behalf of your client, Mundi Westport Group. Photographs were provided in lieu of a sample. The article at issue is a wallet. Per your email correspondence, the wallet is constructed with an outer surface of plastic sheeting that is reinforced with a synthetic material backing. It is flat, rectangular-shaped and folds in half. The interior features several slot pockets for credit cards or identification on each side of the wallet and two open compartments to accommodate paper currency. The back exterior features a zippered pocket. The wallet has a flap with a snap closure. The article is designed to provide storage, protection, organization, and portability to paper currency, credit cards, identification, and similar articles. A style number was not provided. In your submission, you state that raw materials, polyvinyl chloride (PVC), nylon, and woven paper, are from China. They are exported to Vietnam in bulk and in the form of uncut rolls. Molded metal snaps, molded metal zipper pulls, and spooled nylon thread are also from China, but they remain in China for the assembly process into a finished wallet. The assembly operations in China include gluing, sewing, trimming, cleaning, and packing. Cardboard and foam are from Vietnam. In Vietnam, the Vietnamese-origin raw materials, which include woven paper, cardboard, forms, clear PVC, nylon zippers, PVC, and nylon, and the Chinese origin materials are cut into components in the shape of the wallet. The individual components are gathered into bundles by component shape and wallet style number and are exported to China for an assembly operation into a finished wallet.  Part 134, Customs and Border Protection (CBP) Regulations (19 C.F.R. 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304. Section 134.1(b), CBP Regulations (19 C.F.R. 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 [the marking regulations]. . . .” A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, or use which differs from the original material subjected to the process. United States v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982). In order to determine whether a substantial transformation occurs when components are assembled into completed products, all factors such as the components used to create the product and the manufacturing processes that these components undergo are considered in order to determine whether a product with a new name, character, and use has been produced. No one factor is decisive, and assembly/manufacturing operations that are minimal will generally not result in a substantial transformation. CBP has previously held that cutting materials to defined shapes or patterns suitable for use in the assembly of a finished article, as opposed to mere cutting to length and/or width which does not render the article suitable for a particular use, constitutes a substantial transformation. See, for e.g., Headquarters Ruling Letter ("HQ") H005728, dated April 19, 2007, HQ 562156, dated July 5, 2001, and HQ 734539, dated June 8, 1992. Based on the information provided, we find that the component materials undergo a substantial transformation in Vietnam as a result of the cutting to shape to form the wallet components for later assembly into the finished article. As such, the country of origin for the wallet 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 Vikki Lazaro at vikki.lazaro@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division