H344034

H344034 April 8, 2026 OT:RR:CTF:FTM H344034 MJD CATEGORY: Origin Mr. Robert J. Leo Meeks, Sheppard, Leo & Pillsbury LLP 570 Lexington Avenue New York, New York 10022 RE: Country of Origin of Printed Circuit Board Assemblies Dear Mr. Leo: This letter is in response to your request, on behalf of Axis Communications AB, (hereinafter “Axis AB” or “Requestor”) dated November 27, 2024, for a binding ruling regarding the country of origin of certain Printed Circuit Board Assemblies (“PCBAs”). You have asked that certain information submitted in connection with this ruling be treated as confidential. Inasmuch as this request conforms to the requirements of 19 C.F.R. § 177.2(b)(7), the request for confidentiality is approved. The confidential information contained in the attachments to the ruling request will not be released to the public and will be withheld from published versions of this ruling. FACTS: The products at issue are several types of PCBAs that are manufactured in the United States from component parts from the United States and parts imported from China, Sweden, and other European Union countries. Axis AB uses two different processes to manufacture the boards into PCBAs: Surface Mount Technology (“SMT”) and Pin-Through-Hole (“PTH”). The SMT and PTH process are performed in the United States and are described as follows: For both the SMT and PTH, the process begins with: 1. Marking (via laser and if not practical then via labeling): For traceability all boards need to be marked (approximately 2 to 3 hours). 2. Electrostatic Discharge (“ESD”): When preparing for PCBA assembly ESD is needed to secure the production environment against unwanted ESD events that may damage the assembly (approximately 2 to 3 hours). 3. Printed Circuit Board (“PCB”) Panel Design: The majority (if not all) of the PCB’s needs to have a PCB panel designed in order to run production of the PCB boards in the automated production lines (approximately 1 hour). For the SMT process, components are placed and soldered on plated pads on the surface of the PCB. This consists of: 1. Solder paste application: This is the process where the solder paste is printed on the board, this is needed to be able to solder components to the board and get the required electrical connection. All boards need to go through the solder paste application process (approximately 2.5 to 3 hours). 2. Dispensing: The process where either solder paste and/or adhesive is applied on the board via dots from a nozzle (needle type) (approximately 1 hour). 3. Solder Paste Inspection: Inspection of solder paste application. All boards need to go through the solder paste inspection process (approximately 2 to 3 hours). 4. Component Mounting: This process involves populating the board. This is done in the mounting machines. An SMT line today consists of a minimum two SMT machines. For larger and more populated boards – there are more than two SMT machines in the line. All boards go through the mounting process (approximately 2 to 3 hours). 5. Reflow Soldering: In order to use the boards they now need to be soldered and that is done in the reflow oven where the PCB panels are put through 12 – 14 different heating zones to build up the temperature to the point where the alloy in the solder paste melts, this is done in a controlled and regulated way to allow the solder paste flux to clean the surfaces of the PCB and components, as well as the metal alloy spheres in the solder paste before it melts and binds it together. After the solder paste has melted it needs to be cooled down and solidified again (approximately 2 to 4 hours). 6. Automated Optical Inspection (“AOI”): When the PCB panel has been soldered it needs to be checked and verified so that the solder connections are reliable and able to perform the standard requirements. For solder connections that are visible, this is done in the AOI. All the visible solder connections on all the boards in the PCB panel are scanned by a camera (in 2D or 3D depending on the equipment) (approximately 2 to 3 hours). 7. Automated X-ray Inspection (“AXI”): Since the solder connections are not visible, an x-ray inspection needs to be done. This is done on all hidden solder connections on all the boards in the PCB (approximately 2 to 3 hours). For the PTH process, the process continues with through hole technology where components are mounted and soldered through holes in the PCB. Also sometimes called THT (“Through Hole Technology”). This consists of the following procedures: 2 1. Soldering: All boards that have PTH components need to be soldered either by (1) wave soldering, (2) selective soldering or (3) robot soldering ? Wave soldering: In wave soldering the PCB panel are put in a fixture that holds the panel in place. The fixture with the PCB panel is loaded into the wave soldering oven, flux is applied (sprayed) on the areas to be soldered, then it is pre-heated to activate the flux so that it cleans the area where the solder will flow to and create a connection. The fixture with the PCB panel then passes over a wave of molten solder which makes the molten solder attach to the component pins and copper around it (approximately 2 to 4 hours). ? Selective soldering: In selective soldering a small wave, located in a cup is moved around, only going up against the board soldering the exact points where PTH component solder connections need to be created (approximately 2 to 4 hours). ? Robot soldering: a standalone process with just the robot soldering equipment (approximately 2 to 4 hours). 2. Depaneling: Since the boards are placed in panels they need to be depaneled either by laser or router (approximately 2 to 3 hours). 3. Inspection: When the board is fully assembled on a PCBA level it is inspected, oftentimes manually with the help of a microscope (approximately 10 minutes). Each step in manufacturing the PCBA’s undergoes the following three phases: (1) preparation, (2) optimization/startup, and (3) production. The preparation phase is performed by an engineer with several years of experience, who has specialized knowledge of their area of expertise, while also having a general knowledge of the whole process and production equipment and machines, and receives extensive training for one to two weeks depending on the machines and/or process. The optimization/startup phase is performed by an engineer or technician with a minimum of one to two years of experience with process knowledge in their area of expertise as well as a general understanding of the whole process, who receives training for one to two weeks depending on the machines and/or process. The production phase is performed by an operator who is either the head operator who has a minimum of one year of experience, operators in a team that have relevant training for their area, a single operator that has a minimum of year of experience, or the operator inspector that has relevant training and knowledge for their area. The Requestor provides that once the PCBAs are completed they also will be programmed in the United States with Axis AB’s proprietary software. This software is designed in Sweden. ISSUE: What is the country of origin of the PCBAs? 3 LAW AND ANALYSIS: The marking statute, section 304 of the 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 an 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 markings on the imported goods the country of which the good is the product. The evident purpose is to mark the goods so that at the time of purchaser the ul

The marking statute, section 304 of the 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 an 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 markings on the imported goods the country of which the good is the product. The evident purpose is to mark the goods so that at the time of purchaser 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. Friedlaender & Co., 27 C.C.P.A. 297, 302 C.A.D. 104 (1940). 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. Section 134.1(b), CBP Regulations (19 C.F.R. § 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 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 which differs from the original material subjected to the process. United States v. Gibson Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982). In order to determine whether a substantial transformation