The country of origin of Octal Small Form Factor Pluggable transceiver modules

N361198 May 18, 2026 OT:RR:NC:N2:209 CATEGORY: Origin Lisa Murrin Expeditors Tradewin LLC 795 Jubilee Drive Peabody, MA 01960 RE: The country of origin of Octal Small Form Factor Pluggable transceiver modules Dear Ms. Murrin: In your letter dated May 4, 2026, you requested a country of origin ruling on behalf of your client, Aperion Technologies, for Octal Small Form Factor Pluggable transceiver modules. The items concerned are referred to as Octal Small Form Factor Pluggable (OSFP) transceiver modules, model numbers 800G OSFPDR8, 800G OSFP2xDR4, 800G OSFP2xFR4, 1.6T OSFP2xDR4, and 1.6T OSFP2xFR4. These transceiver modules will be mounted to each end of a length of fiber optic cable. The subject merchandise is a hot-pluggable module that plugs into network devices, such as switches in data centers. It is used to convert an electrical signal into an optical signal, and conversely an optical signal back into an electrical signal. These transceivers are designed for use in 800 Gigabit Ethernet links on up to 500m of single mode fiber. They are used for networking in the data communications sector to receive, convert, and transmit different signals. We agree that these OSFP transceiver modules are similar to the ones discussed in rulings N358465, dated February 27, 2026 and N352670, dated September 10, 2025. The main components of the OSFP transceiver are the printed circuit board assembly (PCBA), the optical subassembly (OSA), and the transceiver housing. Scenario 1 OSA (China-Origin): The OSA includes both a TOSA (transmit optical subassembly) and a ROSA (receive optical subassembly). The TOSA and ROSA are referred to as “Tx” and “Rx.” The Tx (transmitter) part of the OSA is responsible for converting the electrical signals into optical signals and transmitting these signals over the optical fiber strand in the FA (fiber array) connected to it. One laser diode unit generates and focuses a light beam into a SiPho (Silicon Photonic) integrated circuit. The photonic integrated circuit splits the light signal into four light beams and takes electrical signals from the main PCBA to modulate the four collected light beams. Then, four lights are launched into the optical fibers of the FA via the isolator focus optics. The light beams then travel to the receptacle connector and out of the optical transceiver. The Tx part of the OSA is manufactured in China and attached to the Malaysia origin PCBA in China. The Rx (receiver) part of the OSA is responsible for receiving the optical signals transmitted from the Tx part of the transceiver and converting them back to electrical signals so that the communication equipment can understand them. The Rx part of the OSA consists of an Rx block, four photodiodes, two single-layer capacitors, and a transimpedance amplifier. The Rx part of the OSA receives four light beams from optical fibers and sends them to four photodiodes. It is the photodiodes that convert the light signals into electrical signals which are then amplified by the transimpedance amplifier on the PCBA. The Rx part of OSA is manufactured in China and attached to the Malaysia origin PCBA in China. Main Board PCBA (Malaysia-origin) The Main Board PCBA contains approximately 560 electrical elements sourced from various countries of origin. The main electrical element on the PCBA is the digital signal processor (DSP) chip of U.S.-origin. This is the highest value item on the BOM and a critical component of the PCBA. The Main Board PCBA is the foundation of the transceiver and imparts its essence. Without the Main Board PCBA, the Tx part of the OSA cannot generate optical signals and the Rx part of the OSA cannot convert optical signals into electrical signals. The DSP provides for signal amplification, detection, regeneration, and reconditioning. The DSP works with the OSA and provides electrical driving signals for the OSA (both the Tx and Rx). The DSP signals the laser diode of the Tx side of the OSA to emit optical signals into the fiber array and out of the transceivers. The DSP also processes optical signals from the fiber array into the transceiver on the Rx side of the OSA. The signal is not readable by the OSA until it is formatted by the DSP chips. On the receiving side, when the optical transceiver receives a signal from the OSA and converts the optical signal to electrical signal, the electrical signal is not readable by the optical transceiver until it undergoes further processing from the DSP. The Main Board PCBA also contains an erasable programmable read-only memory chip (EPROM) that will be programmed in Malaysia to provide the required instructions to perform the transceiver function. The EPROM information is saved in the flash memory of the MCU IC (Accelink PCBA Part Number 20719401 on the BOM). More than three-fourths of the total components of the transceiver are on the Main Board PCBA. Manufacturing of the Main Board PCBA in Malaysia: Production in Malaysia includes the creation of the PCBA via surface mount technology (SMT). The PCBA consists of numerous components/elements from various countries of origin. The SMT process is a multistage process requiring different types of specialized machines. The SMT process for the PCBA is as follows: 1. Solder paste printing. 2. Solder paste inspection (SPI). 3. SMT by means of a pick-and-place machine is used to populate the board with approximately 560 dedicated PCBA components. 4. Solder reflow to permanently adhere the components to the board. 5. Optical inspection (AOI). 6. Automated 3D x-ray inspection. 7. Another round of the SMT subprocess, repeating all previous steps. 8. Conformal coating in order to protect the PCBA and its components. The coating is then dried and baked. 9. Manual visual inspection via microscope. Once the PCBA is assembled, it is sent to China where the OSA is attached. Manufacturing Steps in China: Attaching the OSA to the PCBA 1. Receive PCBA from Malaysia. 2. Attach the SiPo, laser diode, and substrate onto PCBA. 3. Perform wire bonding. 4. Attach the isolator to the PCBA with epoxy curing. 5. Attach and align Lens 1 to the PCBA with epoxy curing. 6. Attach and align Lens 2 to the PCBA with epoxy curing. 7. Attach and align the Tx Fiber Array with epoxy curing. 8. Rx FA alignment and attach with epoxy curing. 9. Attach a cover to protect the OSA on PCBA. 10. Test and inspect the OSA-on-PCBA. The OSA-on-PCBA is then returned to Malaysia where it is assembled into the finished transceiver. Final Assembly in Malaysia: Once the OSA-on-PCBA arrives back in the Malaysia, thermal grease is added to the light source in order to ensure heat dissipation and a component for heat release is attached to the light source. Next, an OSA cover is attached to the OSA via a UV curing and baking process. Next, the fiber router is attached, which routes fibers between the Tx part of the OSA subassembly, the Rx part of OSA subassembly, and the fiber connectors. Lastly, thermal pads are attached to allow the entire optical transceiver to dissipate heat. Once the above manufacturing in Malaysia is completed, the mechanical housing is attached to the parts, the software is loaded, and the transceiver undergoes electrical and optical performance tuning, testing, and quality assurance. Scenario 2 The manufacturing process for scenario 2 is similar to those in scenario 1 in relation to the work done in China. The main difference between the two scenarios is the manufacturing process in regard to the Main Board PCBA. Main Board PCBA (U.S.-origin) The Main Board PCBA contains the digital signal processor (DSP) chip of U.S.-origin. This part is the highest value part on the BOM and a critical component of the PCBA. The Main Board PCBA is the foundation of the transceiver and imparts its essence. Without the Main Board PCBA, the Tx part of the OSA cannot generate optical signals and the Rx part of the OSA cannot convert optical signals into electrical signals. The DSP provides for signal amplification, detection, regeneration, and reconditioning. The DSP works with the OSA and provides electrical driving signals for the OSA (both the Tx and Rx). The 4 DSP signals the laser diode of the Tx side of the OSA to emit optical signals into the fiber array and out of the transceivers. The DSP also processes optical signals from the fiber array into the transceiver on the Rx side of the OSA. The signal is not readable by the OSA until it is formatted by the DSP chips. On the receiving side, when the optical transceiver receives a signal from the OSA and converts the optical signal to electrical signal, the electrical signal is not readable by the optical transceiver until it undergoes further processing from the DSP. The Main Board PCBA also contains an erasable programmable read-only memory chip (“EPROM”) that will be programmed in the U.S. to provide the required instructions to perform the transceiver function. The EPROM information is saved in the flash memory of the MCU IC (Accelink PCBA Part Number 20719401 on the BOM). In addition to the DSP chip and the EPROM, the PCBA consists of approximately 560 electrical components from various countries of origin. More than three-fourths of the total components of the transceiver are on the Main Board PCBA. Manufacturing of the Main Board PCBA in United States: Production in the U.S. includes the creation of the PCBA via surface mount technology (“SMT”). The PCBA consists of numerous components/elements from various countries of origin. The SMT process is a multistage process requiring different types of specialized machines. It takes 10.2 minutes to assembly the PCBA in a fully automated process using specialized equipment. The SMT process for the PCBA is as follows: 1. The printed circuit board will undergo solder paste printing. 2. The board will undergo an initial solder paste inspection (“SPI”). 3. The board’s solder side will be surface-mounted by means of a pick-and-place machine that populates the solder side of the board with its dedicated PCBA components. 4. The solder side will undergo solder reflow to permanently adhere the components to the board. 5. The PCBA will undergo automated optical inspection (“AOI”). 6. The PCBA will undergo an automated 3D x-ray inspection. 7. The PCBA will undergo another round of the SMT subprocess, repeating all previous steps. 8. The PCBA will then undergo conformal coating in order to protect the PCBA and its components from moisture, dust, or other forms of damage. The coating is then dried and baked. 9. The PCBA will undergo a manual visual inspection via microscope. Once the PCBA is assembled, it is sent to China where the OSA is attached When determining the country of origin for purposes of applying current trade remedies under Section 301and additional duties, the substantial transformation analysis is applicable. See, e.g., Headquarters Ruling Letter 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 upon the facts presented, it is the opinion of this office that the manufacturing processes that take place within Malaysia for scenario 1 and the United States for scenario 2 to create the main PCBA is both substantial and complex. The character of this product is imparted by the main PCBA which would be considered the dominant component of this assembly. The assembly/manufacturing process that takes place in China does not change the end use of the main PCBA. The PCBA does not undergo a substantial transformation as a result of the Chinese processing. Therefore, since a substantial transformation does not occur as a result of the Chinese processing, the country of origin of the Octal Small Form Factor Pluggable (OSFP) transceiver modules, model numbers 800G OSFPDR8, 800G OSFP2xDR4, 800G OSFP2xFR4, 1.6T OSFP2xDR4, and 1.6T OSFP2xFR4 will be Malaysia for scenario 1 and the United States for scenario 2 for the purpose of applying current trade remedies and additional duties. If a good is determined to be an article of U.S. origin, it is not subject to the country of origin marking requirements of 19 U.S.C. 1304. 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, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is made in the U.S. 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 Steven Pollichino at steven.pollichino@cbp.dhs.gov. Sincerely, (for) James P. Forkan Director National Commodity Specialist Division