The country of origin of fiber optic cable assemblies

N314790 October 13, 2020 CLA-2-85:OT:RR:NC:N2:212 CATEGORY: Country of Origin Paula Connelly Sandler, Travis & Rosenberg, P.A. 100 Trade Center, Suite G-700 Woburn, MA 01801 RE: The country of origin of fiber optic cable assemblies Dear Ms. Connelly: In your letter dated September 25, 2020, you requested a tariff classification ruling on behalf of your client, Senko Advanced Components, Inc. There are two items at issue with this request that are identified as the following: SC/APC-SC/APC SM SX EZ Bend 3mm 10FT FS SC/APC-SC/APC (PUSHABLE) SM 3mm 30F The subject items are described as fiber optic cable assemblies used for various telecommunications and data communication applications. The assemblies each consist of a length of insulated optical fibers terminated at each end with specialized optical connectors. You state that the manufacturing process for each is different and occurs in different locations. For the item identified as SC/APC-SC/APC SM SX EZ Bend 3mm 10FT, you state that individual optical fibers of German origin are sent to Mexico where they are jacketed prior to being sent to China for final processing. In China, the jacketed fibers are cut to the desired length and the connector parts, including the ferrule, of Chinese origin are assembled and adhered onto the ends. The epoxy is heated in an oven to cure before the remaining connector parts are added to complete the assembly. For item FS SC/APC-SC/APC(PUSHABLE) SM 3mm 30F, individual optical fibers of U.S. origin are sent to Finland where they are jacketed prior to being sent to China for final processing. In China, the jacketed fibers are cut to the desired length and the connector parts, including the ferrule, of Chinese origin are assembled and adhered onto the ends. The epoxy is heated in an oven to cure before the remaining connector parts are added to complete the assembly. 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. With regard to the origin of the subject assemblies, based upon the facts presented, it is the opinion of this office that the optical fibers impart the essential functional component of the finished article. While the jacketing and connectors are integral to the function of the assemblies in their finished state, we find that their addition does not substantially transform the fibers into a new and different article of commerce with a name, character, and use distinct from the exported article. For the assembly identified by part number SC/APC-SC/APC SM SX EZ Bend 3mm 10FT, the country of origin is Germany. For assembly FS SC/APC-SC/APC (PUSHABLE) SM 3mm 30F, the country of origin is the U.S. Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 6th and Pennsylvania Avenue, N.W., Washington, D.C. 20508 on the propriety of proposed markings indicating that an article is made in the USA. 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