The country of origin of fiber optic modules

N317160 February 8, 2021 CLA-2-85:OT:RR:NC:N2:212 CATEGORY: Country of Origin Paula Connelly Sandler, Travis & Rosenberg, P.A. 100 Trade Center, Suite G-100 Woburn, MA 01801 RE: The country of origin of fiber optic modules Dear Ms. Connelly: In your letter dated January 26, 2021, you requested a country of origin ruling on behalf of your client, Senko Advanced Components. There are four items at issue with this request, identified as follows: QXP SC APC Connector XPFit PLUS SC CONNECTOR, SM PC 250/900 um XPFit PLUS LC CONNECTOR MM 50/125 10G OM3 250/900 um XPFit UNI SC CONNECTOR, SM APC The subject items are described as field installable connector assemblies for use in various telecommunications and data communication applications. The assemblies are constructed of an optical fiber encased within a connector housing, allowing for quick installation within a fiber optic system. The manufacturing process for all four parts is nearly identical and occurs in China. The primary difference in the process centers around the unique form of the connector housing parts from different origins exclusive to each connector. In all cases, the optical fiber originates from Japan and is imported into China. In China, a ferrule is bonded to the end of the fiber and then the unit is crimped and adhered to a mechanical splice. The remainder of the housing components, originating from various countries, are then assembled around the fiber and ferrule, completing 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 assembly of the connector bodies is 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 fiber optic modules identified by part numbers QXP SC APC Connector, XPFit PLUS SC CONNECTOR, SM PC 250/900 um, XPFit PLUS LC CONNECTOR MM 50/125 10G OM3 250/900 um, and XPFit UNI SC CONNECTOR, SM APC the country of origin is Japan. 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