H318556

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H318556 June 8, 2021 OT:RR:CTF:FTM H318556 MD CATEGORY: Marking Ms. Jennifer Diaz Diaz Trade Law 12700 Biscayne Boulevard, Suite 301 North Miami, Florida 33181 Re: Country of Origin Marking of Electrical Wire Cables Dear Ms. Diaz, This is in response to your correspondence, dated May 4, 2021, requesting a binding ruling, on behalf of Repwire LLC (“Repwire” or “Importer”), concerning the country of origin marking of certain electrical wire cables that will be ultimately imported from the Republic of Korea (“South Korea”). Your request, submitted as an electronic ruling request, was forwarded to this office from the National Commodity Specialist Division (“NCSD”) for review. Our ruling is set forth below. FACTS: The electrical wire cables at-issue in this ruling were previously discussed in two New York Ruling Letters (“NY”), NY N318134, dated March 25, 2021; and NY N318824, dated April 21, 2021. In both NY N318134 and NY N318824, there were five types of electrical wire cables being discussed: “MHF Cables,” “SER Cables,” “URD Cables,” “USE Cables,” and “XHHV Cables.” According to both NY N318134 and NY N318824, “the manufacturing process for all five cables is virtually identical.” This manufacturing process is described as follows. First, “[a]luminum wire […] is imported into Korea where it is stranded and layed out.” This aluminum wire is either of Indian (as was the case in NY N318134) or Australian (as was the case in NY N318824) origin. The aluminum wires are then insulated by a “compound [which] originates from Korea.” Afterwards, “[t]he cables are then cut to the desired length and wound on reels prior to [export] to the [United States].” Regarding the country of origin of the electrical wire cables, both NY N318134 and NY N318824 ultimately held that “the [] originating aluminum wires impart the essential functional component of the finished items.” Further, both NY N318134 and NY N318824 note that the “wires are not substantially transformed by the operations performed in Korea into a new and different article of commerce with a name, character, and use distinct from the individual components.” As such, the NY rulings concluded that the country of origin of the electrical wire cables was dependent on the origin of the aluminum wires – either India in NY N318134 or Australia in NY N318824. In your ruling request, you note that “South Korea’s customs authorities have taken issue with marking that the cables are of Indian or Australian origin because the cable manufacturing process does occur in South Korea.” Furthermore, you enumerate Repwire’s “intent[] to move forward with importing the cables from South Korea adhering to CBP’s binding ruling that the subject merchandise should be marked according to the country that the aluminum wire is sourced (i.e., India or Australia)” prior to the objections of the Korean authorities. With no dispute into the country of origin of the products at-issue, this ruling will solely address the proposed marking for the electrical wire cables. ISSUE: Whether the proposed marking of the electrical wire cables satisfies the country of origin marking requirements set forth in 19 U.S.C. § 1304 and 19 C.F.R. Part 134. LAW AND ANALYSIS: Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. § 1304), provides that unless excepted, every article of foreign origin 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. Congressional intent in enacting 19 U.S.C. § 1304 was “that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will.” United States v. Friedlander & Co., 27 C.C.P.A. 297 at 302; C.A.D. 104 (1940) (emphases added). Part 134, 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. Section 134.1(b) defines “country of origin” as: [T]he 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 [the marking regulations]… A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, or use that differs from the original material subjected to the process. M.B.I. Merchandise Industries, Inc. v. United States, 16 C.I.T. 495, 502 (1992) (citing United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267, 270 (C.A.D. 98) (1940)). The question of whether a substantial transformation occurs for marking purposes is a question of fact, to be determined on a case-by-case basis. National Hand Tool Corp. v. United States, 16 C.I.T. 308, 311 (1992) (quoting Uniroyal Inc. United States, 3 C.I.T. 220 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983)). As discussed above, CBP determined in NY N318134, dated March 25, 2021; and NY N318824, dated April 21, 2021, that the electrical wire cables are products of either India or Australia, dependent on which of the two countries the aluminum wire used to manufacture the product was made. This is because “the [] originating aluminum wires impart the essential functional component of the finished items.” Acknowledging these determinations, Repwire “intended to move forward with importing the cables from South Korea adhering to CBP’s binding ruling that the subject merchandise should be marked according to the country that the aluminum wire is sourced (i.e., India or Australia).” However, you state that “South Korea’s customs authorities have taken issue with marking that the cables are of Indian or Australian origin because the cable manufacturing process does occur in South Korea.” In voicing their concern, the Korean customs authorities suggested “the markings ‘Made with Aluminum from India’ and ‘Made with Aluminum from Australia’” for the subject merchandise. In turn, you suggested a number of alternative markings, which include: Made with Aluminum from India or Made with Aluminum from Australia Cables Made in South Korea with Aluminum from India or Cables Made in South Korea with Aluminum from Australia Cables Made in South Korea with Aluminum Wire from India or Cables Made in South Korea with Aluminum Wire from Australia Cable Made in South Korea with Indian Wire or Cables Made in South Korea with Australian Wire Upon review, we find that each of the above markings would not satisfy requirements of 19 U.S.C. § 1304. CBP’s rulings in NY N318134 and NY N318824 were explicit; the electrical wire cables are products of either India or Australia. CBP reached this conclusion through a substantial transformation analysis; finding that the aluminum wire imparts the essential character of the finished electrical wire cables, that these aluminum wires are either products of India or Australia, and that the further processing of the aluminum wires into the finished electrical wire cables does not substantially transform them. As a result, the electrical wire cables retain the country of origin of where the aluminum wires they were constructed from were sourced – either India or Australia – and must be marked as such to satisfy 19 U.S.C. § 1304. None of the above marking proposals indicate that the country of origin of the products is e

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. § 1304), provides that unless excepted, every article of foreign origin 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. Congressional intent in enacting 19 U.S.C. § 1304 was “that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will.” United States v. Friedlander & Co., 27 C.C.P.A. 297 at 302; C.A.D. 104 (1940) (emphases added).Part 134, 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. Section 134.1(b) defines “country of origin” as:[T]he 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 [the marking regulations]…A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, or use that differs from the original material subjected to the process. M.B.I. Merchandise Industries, Inc. v. United States, 16 C.I.T. 495, 502 (1992) (citing United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267, 270 (C.A.D. 98) (1940)). The question of whether a substantial transformation occurs for marking purposes is a question of fact, to b