H328859

HQ H328859 June 10, 2024 OT:RR:CTF:VS H328859 AMW CATEGORY: Origin Mr. Rick Van Arnam, Esq. Barnes, Richardson & Colburn, LLP 100 William Street Suite 305 New York, NY 10038 RE: U.S. Government Procurement; Title III, Trade Agreements Act of 1979 (19 U.S.C. 2511); Subpart B, Part 177; Brother Mobile Solutions, Inc.; Country of Origin of Mobile Thermal Printers; Substantial Transformation Dear Mr. Van Arnam: This is in response to your request of November 14, 2022, on behalf of your client, Brother Mobile Solutions, Inc. (“Brother”), for a final determination concerning the country of origin of various thermal printer models, pursuant to Title III of the Trade Agreements Act of 1979 (“TAA”), as amended (19 U.S.C. 2511 et seq.), and subpart B of Part 177, U.S. Customs and Border Protection (“CBP”) Regulations (19 CFR 177.21, et seq.). Brother is a party-at-interest within the meaning of 19 CFR 177.22(d)(1) and 177.23(a) and is therefore entitled to request this final determination. FACTS: Brother seeks a country of origin determination related to five separate models of thermal printers described as the “Brother PocketJet 8 Mobile Thermal Printers” (the “thermal printers”). Your request states that the assembly process for the thermal printers is the same, though the devices differ in type of interface (i.e., USB, Bluetooth, or Wi-Fi) and resolution (either “standard resolution” at 203 dots per inch (“DPI”) or “high resolution” at 300 dots per inch). The five models are as follows: Model Interface Resolution  PJ-822 USB 203 DPI  PJ-823 USB 300 DPI  PJ-862 USB, Bluetooth 203 DPI  PJ-863 USB, Bluetooth 300 DPI  PJ-883 USB, Bluetooth, Wi-Fi 300 DPI   The thermal printers provide full-page mobile printing, producing text or images by passing specially treated paper (i.e., thermal paper) over a “print head” comprised of a small, electrically heated element. Upon exposure to heat, the coating on the paper turns black, producing the desired text or image. The thermal printers connect with most computer models, including IOS and Android devices. The thermal printers will undergo final assembly in Japan by Mie Brother Precision Industries, Ltd. (“Mie Brother”) utilizing discrete components imported from Taiwan, Vietnam, and China, as well as a Japanese-origin printed circuit board assembly (“PCBA”). As outlined in your request, the thermal printers consist of four main component groupings: (1) Print mechanism The print mechanism utilizes direct thermal technology to apply heat to the treated paper and produce text and images. The print mechanism is comprised of approximately 48 components, including a chassis assembly, head spring, gears, thermal plate, paper guide, screws, and a stepping motor used to move paper through the print mechanism. The print mechanism is comprised entirely of Chinese-origin components (aside from the Taiwanese-origin stepping motor), which are assembled into the thermal printers in Japan. (2) Covers/chassis The covers and chassis are static items that make up the chassis of the thermal printers. They are comprised of approximately 59 components, including a top cover, back cover chute cover, battery latches, face tape, and various labels and screws. Each of these components is produced in China and are assembled into the printers in Japan. (3)Sensor unit The sensor unit consists of five components: a Vietnam-produced membrane switch, which functions as an operator interface, allowing the user to operate and control the device. The remaining components, including flexible printed circuits that control the printer’s on/off switch, its LED indicator, and a radio circuit (Bluetooth vs. WiFi in model PJ 863), are all produced in China and assembled into the printers in Japan. (4) Main PCBA The main PCBA is produced by a third-party manufacturer in Japan. The PCBA includes the device’s firmware, and functions as the motherboard of the printer. It controls communication with the device looking to print (i.e., computer or phone), houses the memory for the printer, and forms the image to be printed. In addition to the physical components described above, you state that the device’s firmware is designed and developed in Japan. The firmware consists of software embedded into the PCBA that will control the device. All told, your request indicates that slightly more than half of the printers’ value, is attributable to production occurring in China. Slightly less than half of the printers’ value is produced in Japan. Less than 10% by value is produced in Vietnam and in Taiwan. By quantity, approximately 97% of all components are produced in China, whereas 1% of the printers’ components are produced in Japan, 1% in Taiwan, and 1% in Vietnam. You state that the final assembly of the above-mentioned components occurs in Japan. Specifically, your request indicates that assembly in Japan occurs in roughly the following steps: Mainframe assembly In this stage, the main PCBA is mounted to the main chassis assembly. Then, the stepping motor is attached to the chassis, and the print mechanism components are affixed. Next, the side and upper chassis boards are attached to the main frame, as are three head pressing springs. The platen and transfer gears are added. Finally, the chute cover is attached to this frame. Cover Assembly Next, the cover assembly is created. The components of the sensor unit – the membrane switch, LED lamp, and various flexible printed circuits, are assembled to the top cover. The back cover is then attached, followed by the top cover and then the latches. All cover screws are tightened. A dummy battery is inserted, and a label is affixed on the bottom of the cover. After assembly is complete, the thermal printers undergo a testing process in which the machines receive a function test, printing inspection, Wi-Fi/Bluetooth check, and appearance inspection. ISSUE: What is the country of origin of the subject thermal printers for purposes of U.S. Government procurement? LAW AND ANALYSIS: CBP issues country of origin advisory rulings and final determinations as to whether an article is or would be a product of a designated country or instrumentality for the purpose of granting waivers of certain “Buy American” restrictions in U.S. law or practice for products offered for sale to the U.S. Government, pursuant to subpart B of Part 177, 19 CFR 177.21 et seq., which implements Title III, Trade Agreements Act of 1979, as amended (19 U.S.C. 2511-2518). CBP’s authority to issue advisory rulings and final determinations is set forth in 19 U.S.C. 2515(b)(1), which states: For the purposes of this subchapter, the Secretary of the Treasury shall provide for the prompt issuance of advisory rulings and final determinations on whether, under section 2518(4)(B) of this title, an article is or would be a product of a foreign country or instrumentality designated pursuant to section 2511(b) of this title. The rule of origin set forth in 19 U.S.C. 2518(4)(B) states: An article is a product of a country or instrumentality only if (i) it is wholly the growth, product, or manufacture of that country or instrumentality, or (ii) in the case of an article which consists in whole or in part of materials from another country or instrumentality, it has been substantially transformed into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was so transformed. See also 19 CFR 177.22(a). In rendering advisory rulings and final determinations for purposes of U.S. Government procurement, CBP applies the provisions of subpart B of Part 177 consistent with the Federal Acquisition Regulations (“FAR”). See 19 CFR 177.21. In this regard, CBP recognizes that the FAR restricts the U.S. Government’s purchase of products to U.S.-made or designated country end products for acquisitions subject to the TAA. See 48 CFR 25.403(c)(1). Section 25.003 defines “designated country end

CBP issues country of origin advisory rulings and final determinations as to whether an article is or would be a product of a designated country or instrumentality for the purpose of granting waivers of certain “Buy American” restrictions in U.S. law or practice for products offered for sale to the U.S. Government, pursuant to subpart B of Part 177, 19 CFR 177.21 et seq., which implements Title III, Trade Agreements Act of 1979, as amended (19 U.S.C. 2511-2518).CBP’s authority to issue advisory rulings and final determinations is set forth in 19 U.S.C. 2515(b)(1), which states:For the purposes of this subchapter, the Secretary of the Treasury shall provide for the prompt issuance of advisory rulings and final determinations on whether, under section 2518(4)(B) of this title, an article is or would be a product of a foreign country or instrumentality designated pursuant to section 2511(b) of this title.The rule of origin set forth in 19 U.S.C. 2518(4)(B) states:An article is a product of a country or instrumentality only if (i) it is wholly the growth, product, or manufacture of that country or instrumentality, or (ii) in the case of an article which consists in whole or in part of materials from another country or instrumentality, it has been substantially transformed into a new and different article of commerce with a name, character, or use distinct from that of the article or articles from which it was so transformed.See also 19 CFR 177.22(a). In rendering advisory rulings and final determinations for purposes of U.S. Government procurement, CBP applies the provisions of subpart B of Part 177 consistent with the Federal Acquisition Regulations (“FAR”). See 19 CFR 177.21. In this regard, CBP recognizes that the FAR restricts the U.S. Government’s purchase of products to U.S.-made or designated country end products for acquisitions subject to the TAA. See 48 CFR 25.403(c)(1). Section 25.003 defines “designated country end product” as:a WTO GPA [World Trade Organiz