H313495

HQ H313495 December 2, 2020 OT:RR:CTF:VS H313495 AP CATEGORY: Origin Melissa Fox, LCB Commercial Growth and Development Vandegrift Forwarding Company, Inc. 100 Walnut Avenue, Suite 600 Clark, NJ 07066 RE: Country of origin of finished golf club drivers assembled in Mexico; Marking; Section 301 trade remedy; 9903.88.15, HTSUS Dear Ms. Fox: This is in response to your August 4, 2020 ruling request, filed on behalf of Cobra Golf Incorporated (“Cobra Golf” or “importer”), regarding the country of origin of golf club drivers identified as FMAX, SZ and 2021 SZ, which will be assembled in Mexico, for purposes of marking and Section 301 trade remedies. FACTS: Cobra Golf designs, manufactures, and markets golf products and services. The subject goods are finished golf club drivers classifiable in subheading 9506.31.00, Harmonized Tariff Schedule of the United States (“HTSUS”). The FMAX, SZ, and 2021 SZ golf club drivers will be assembled in Mexico with titanium heads, graphite shafts, and rubber grips sourced from the following countries: Model Country of manufacture of the head Country of manufacture of the shaft Country of manufacture of the grip Assembly  FMAX Taiwan (titanium from Taiwan) China (carbon fiber from Japan and resin from China) China (rubber compound from the U.S.) Mexico  FMAX Taiwan (titanium from Taiwan) China (carbon fiber from Japan and resin from China) Mexico (rubber compound from the U.S.) Mexico  SZ Taiwan (titanium from Taiwan) Bangladesh (carbon fiber and resin from Japan) China (rubber compound from the U.S.) Mexico  2021 SZ Taiwan (titanium from Taiwan) Vietnam (carbon fiber and resin from Japan) China (rubber compound from the U.S.) Mexico  2021 SZ Taiwan (titanium from Taiwan) Vietnam (carbon fiber and resin from Japan) Mexico (rubber compound from the U.S.) Mexico   The head is made from titanium of Taiwanese origin. You explain that the production process for the driver head in Taiwan consists of treating, melting, and casting raw titanium using a wax injection mold. During the wax injection process, wax is injected into a tooling or mold to form the shape of the finished head. The titanium material of Taiwan origin is melted in a high temperature furnace and is then cast into the de-waxed, pre-heated shell clusters. After the casting is complete, the shell clusters undergo a de-shelling process and are broken into individually cast golf heads. Each titanium golf head cast is sandblasted and polished into the final size and shape of the corresponding golf head model. The titanium driver golf heads are then inspected, packed, and shipped from Taiwan to Mexico for the final cosmetic finishing operations. The graphite shaft is produced in China (model FMAX), Bangladesh (model SZ) and Vietnam (model 2021 SZ) from carbon fiber of Japanese origin and resin of Chinese (model FMAX) and Japanese (models SZ and 2021 SZ) origin. The graphite driver shift consisting of 75 percent carbon fiber and 25 percent resin (glue) is made by wrapping sheets of the graphite composite material around a steel mandrel. The composite sheets are cut into different sizes and shapes called flags. These sheets are wrapped in various directions around the shaft depending upon the design of the shaft. The wrapping process is done by hand using computer-controlled alignment rollers. The completed shaft is shrink-wrapped in a cellophane material and heated in an oven to approximately 250 degrees to bond the individual wraps together. The shaft is then cooled, the wrap is removed, and the shaft is sanded to exact frequency tolerances. The driver grip is made in China or Mexico through an injection molded process. The grip is made from rubber compound of U.S. origin. The manufactured head, shaft, and grip are assembled into a golf club in Mexico. ISSUE: What is the country of origin of the subject golf club drivers for the purposes of marking and Section 301 trade remedies? LAW AND ANALYSIS: Marking The marking statute, Section 304, Tariff Act of 1930, as amended (19 U.S.C. § 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the United States shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. Part 134 of the U.S. Customs and Border Protection (“CBP”) Regulations (19 C.F.R. Part 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304. To provide a more seamless transition to the U.S.-Mexico-Canada Agreement (“USMCA”) for Canadian and Mexican traders, at this time, CBP continues to utilize the marking rules in 19 C.F.R. Part 102, with the exception of 19 C.F.R. § 102.19, for purposes of country of origin marking with respect to goods of those countries. Title 19, C.F.R. § 102.11(a) provides that the country of origin of a good is the country in which: The good is wholly obtained or produced; The good is produced exclusively from domestic materials; or (3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in § 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied. “Material” means a good that is incorporated into another good as a result of production with respect to that other good, and includes parts, ingredients, subassemblies, and components.” 19 C.F.R. § 102.1(l). “Foreign material” is defined in Section 102.1(e) as “a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced.” The golf clubs are neither “wholly obtained or produced” nor “produced exclusively from domestic materials.” Therefore, paragraphs (a)(1) and (a)(2) cannot be used to determine the country of origin of the golf clubs, and paragraph (a)(3) must be applied next to determine the origin of the finished article. The tariff shift requirement in Section 102.20 for the golf club drivers at issue states: A change to subheading 9506.31 from any other subheading, except from subheading 9506.39. This tariff shift rule requires a shift to subheading 9506.31, HTSUS, from any other subheading except subheading 9506.39, HTSUS. The golf club components are classified in subheading 9506.39, HTSUS, and do not undergo the change in tariff classification set out in 19 C.F.R. § 102.20(s). Since no country of origin determination can be made applying Section 102.11(a), the analysis continues with Section 102.11(b), which instructs us to examine the golf club’s “essential character” to determine its country of origin. Section 102.11(b) states, in relevant part: Except for a good that is specifically described in the Harmonized System as a set, or is classified as a set pursuant to General Rule of Interpretation [(“GRI”)] 3, where the country of origin cannot be determined under paragraph (a) of this section: The country of origin of the good is the country or countries of origin of the single material that imparts the essential character to the good …. In determining the “essential character” of the finished good, Section 102.18(b)(1) provides, in relevant part: (b) (1) For purposes of identifying the material that imparts the essential character to a good under § 102.11, the only materials that shall be taken into consideration are those domestic or foreign materials that are classified in a tariff provision from which a change in tariff classification is not allowed under the § 102.20 specific rule or other requirements applicable to the good … (ii) Materials that may be considered include materials produced by the producer of the good and incorporated in the good. For example, if a producer of a good purchases raw materials and converts those

Marking The marking statute, Section 304, Tariff Act of 1930, as amended (19 U.S.C. § 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the United States shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. Part 134 of the U.S. Customs and Border Protection (“CBP”) Regulations (19 C.F.R. Part 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. § 1304.To provide a more seamless transition to the U.S.-Mexico-Canada Agreement (“USMCA”) for Canadian and Mexican traders, at this time, CBP continues to utilize the marking rules in 19 C.F.R. Part 102, with the exception of 19 C.F.R. § 102.19, for purposes of country of origin marking with respect to goods of those countries. Title 19, C.F.R. § 102.11(a) provides that the country of origin of a good is the country in which:The good is wholly obtained or produced;The good is produced exclusively from domestic materials; or (3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in § 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied. “Material” means a good that is incorporated into another good as a result of production with respect to that other good, and includes parts, ingredients, subassemblies, and components.” 19 C.F.R. § 102.1(l). “Foreign material” is defined in Section 102.1(e) as “a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced.” The golf clubs are neither “wholly obtained or produced” nor “produced exclusively from domestic materials.” Therefore, paragraphs (a)(1) and (a)(2) c