H331430

HQ H331430 September 27, 2023 OT:RR:CTF:FTM H331430 MJD CATEGORY: Origin Jingyu Deng West Sea Family Fishery Group Co. 181 S Franklin Ave., Suite 703 Valley Stream, New York 11581 Re: Country of Origin of Frozen Fish; Section 301 Measures Dear Mr. Deng: This is in response to your request for a binding ruling, dated March 27, 2023, concerning the country of origin of frozen fish from Canada processed in China and imported into the United States. Your request, submitted as an electronic ruling request, was forwarded to this office from the National Commodity Specialist Division for review. Our ruling is set forth below. FACTS: The merchandise at issue is frozen fish. According to your request, your company purchases frozen whole fish from Canada. The fish under consideration are Pacific Ocean Perch (Sebastes Alutus), Black Cod (Anoplopoma Fimbria), and Pacific Cod (Gadus Macrocephalus). The fish are all wild caught in the Gulf of Alaska in Canadian waters. The fishing vessel that captures the fish is registered in Prince Rupert, Canada. The fish are frozen and then shipped directly to China where they will be cut, cleaned, and packaged at a factory in a Free Trade Zone (“FTZ”) in China. In the FTZ, the fish undergo one of five processes resulting in five different fish products. The five fish products are the following: Product A (Pacific Ocean Perch): The fish is descaled, gilled, and gutted. Product B (Pacific Ocean Perch): The fish is descaled, gilled, and gutted. The fish is cut open so that the two sides of the fish lay flat on each side. The eyes and bones are still intact. Product C (Black Cod): The fish is descaled, gilled, gutted, and beheaded. Product D (Pacific Cod): The fish is cut into fillet pieces. Product E (Pacific Cod): The fish is cut into darne pieces. After the fish are processed in China, products A, B, and C are packaged in sealed plastic bags, and products D and E are packaged in retail paper boxes. Products A, B, and C are classified in subheading 0303.89.00, Harmonized Tariff Schedule of the United States (“HTSUS”), which provides for “Fish, frozen, excluding fish fillets and other fish meat of heading 0304: Other fish, excluding edible fish offal of subheadings 0303.91 to 0303.99: Other.” Products D and E are classified in subheading 0304.95.10, HTSUS, which provides for “Fish fillets and other fish meat (whether or not minced), fresh, chilled or frozen: Other, frozen: Fish of the families Bregmacerotidae, Euclichthyidae, Gadidae, Macrouridae, Melanonidae, Merlucciidae, Moridae and Muraenolepididae, other than Alaska Pollock (Theragra chalcogramma): In bulk or in immediate containers weighing with their contents over 6.8 kg each.” ISSUES: What is the country of origin of the frozen fish? Are the frozen fish subject to Section 301 trade remedies? LAW AND ANALYSIS: Country of Origin 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 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. The 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). Part 134, Customs and Border Protection 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 “the 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 to render such other country the “country of origin” within the meaning of this part.” A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, and use, which differs from the original material subjected to the process. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 C.I.T. 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983). The Court of International Trade indicated in Koru North America v. United States, 701 F. Supp. 229, 232 (Ct. Int’l Trade 1988) that the “Law of the Flag” applies to the country of origin of seafood, which means that the country of origin of the seafood follows the flag of the catching vessel. However, the Court also indicated that we need to consider whether the seafood is subsequently substantially transformed in another country. Id. at 234. In Koru North America, the Court considered whether the processing of be-headed and gutted fish (in South Korea) by thawing, skinning, de-boning, trimming, glazing, freezing, and packaging, constituted a substantial transformation. Id. at 235. The Court concluded that the fish that had been filleted no longer possessed the essential shape of a fish, and that the filleted fish had become its own discrete commercial good distinct from the whole fish when it first arrived in South Korea. Id. CBP has also addressed the country of origin of fish and whether a substantial transformation has occurred. For example, in New York Ruling Letter (“NY”) N304050, dated May 28, 2019, CBP found that smelt harvested in Canadian waters and frozen in a plant in Canada, then exported to China where the fish was “thawed, deheaded, gutted, refrozen, packed” and shipped back to Canada was a product of Canada. Likewise, in NY R04129, dated June 15, 2006, CBP held that catfish fingerlings from the United States remained products of the United States despite being raised, fed, harvested, gutted, skinned, frozen and packaged, but not filleted, in China. CBP explained that “[t]he skinning and gutting of the fish . . . represent[ed] a basic level of processing that advance[d] the fish as a marketable commodity, without altering its commercial character as ‘whole catfish.” Conversely in NY N320603, dated August 16, 2021, CBP held that the country of origin of Yellowfin Tuna caught by Chinese-flagged vessels and processed in Japan was a product of Japan. On the Chinese-flagged vessels the fish were gilled and gutted. Then the fish were exported to Japan where their tails and heads were removed, they were split into pieces, and had their fin bones and spines removed. The remaining loins had the dark flesh and skin removed, and then the belly of the fish were cleared of small bones and bloodlines. Similarly, in NY N284246, dated April 6, 2017, CBP held that salmon “harvested, and then headed, gutted, and frozen in the United States” then exported to China where the salmon was filleted, then sent back to the United States where the salmon fillets were “thawed, cut into smaller pieces, and marinated” was substantially transformed in China. Likewise, in Headquarters Ruling Letter (“HQ”) H311331, dated December 16, 2020, CBP found that the country of origin of frozen roasted (broiled) eel harvested in the United States or various European countries, then exported to China where the eels were placed in growing pods until maturity then further processed were substantially transformed in Ch

Country of Origin 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 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. The 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). Part 134, Customs and Border Protection 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 “the 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 to render such other country the “country of origin” within the meaning of this part.” A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, and use, which differs from the original material subjected to the process. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Un