The country of origin of color motion lighting sets

N344203 December 16, 2024 OT:RR:NC:N4:410 CATEGORY: Country of Origin Elizabeth Lowe Venable LLP 600 Massachusetts Ave NWWashington, DC 20001 RE:  The country of origin of color motion lighting sets Dear Ms. Lowe: This is in response to your letter dated November 21, 2024, on behalf of your client Gemmy Industries Corporation, requesting a country of origin determination on the string light sets for the purposes of applying current trade remedies under Section 301. The merchandise is identified as the Gemmy’s Color-Motion series. They are decorative lighting strings that create dynamic, multicolor displays. Each set typically features 8 to 24 LED lights enclosed within icicle-shaped lamp covers in varying lengths, capable of producing multiple lighting effects, including color transitions and motion patterns. The finished Color-Motion series products are assembled using a printed circuit board assembly (PCBA), Taiwanese-origin LEDs, and the “main structure” i.e., the light string structure. The PCBA components are sourced from China and Taiwan, and the PCBA is manufactured in Cambodia, including soldering to form connection and making it ready for integration into the finished product. The operation uses the SMT (surface mount technology) process. The SMT process involves mounting the various electronic and electrical components onto the bare PCB (printed circuit board). The LED light lamp covers are sourced from Taiwan, and the light string is manufactured in Cambodia. Aside from the three components (i.e., fuses, fasteners, and tin wires) that originate from China, all components of the light string including control boxes, injection molded lamp holders, copper sheets inside the lamp holders, electrical wires, etc., are produced in Cambodia. The subassembly of the LED light strings also takes place in Cambodia, starting with cutting electrical wires to specified lengths and stripping the ends to prepare them for connection. LED lamps are then attached to the lamp holders, evenly spaced, and secured in position using clips or adhesives by design specifications. Once assembled, the LED light string is connected to the control box containing the PCBA, which controls the lighting effects and patterns, creating the finished Color-Motion LED light string. Finally, in Cambodia, the finished product undergoes defect inspection, are packaged with the necessary accessories, and are prepared for distribution. When determining the country of origin for purposes of applying current trade remedies under Section 301, the substantial transformation analysis is applicable. See, e.g., Headquarters Ruling Letter (“HQ”) H301619, dated November 6, 2018. The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character, or use different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 681 F.2d 778 (C.C.P.A. 1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993). Based on the information submitted, a significant number of parts and components are produced in Cambodia, the manufacturing process, including the making of PBCAs via SMT process and the making of plastic parts through plastic molding process, is considered sufficiently “complex and meaningful”, in which the non-Cambodian origin components are substantially transformed in Cambodia when they are used in the production of the color motion lighting sets. The manufacturing process does create a new and different article of commerce with a distinct character and use that is not inherent in the components imported into Cambodia. Therefore, the country of origin of the color motion lighting sets is Cambodia, China Section 301 remedies do not apply. The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP. This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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, please contact National Import Specialist Michael Chen at michael.w.chen@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division