Newly Released CBP HQ Rulings for June 3-4
The Customs Rulings Online Search System (CROSS) was updated June 3 and 4 with the following headquarters rulings (ruling revocations and modifications will be detailed elsewhere in a separate article as they are announced in the Customs Bulletin):
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H313087: Country of origin of finished golf clubs assembled in Mexico; Section 301 trade remedy; 9903.88.15, HTSUS
| Origin: China |
| Item: A finished golf club with a Chinese shaft, a Chinese grip, and a head produced in Mexico from raw Chinese castings. The golf clubs will be assembled in Mexico. The assembly performed in Mexico involves bonding of the club head to the shaft, attaching of the rubber grip to the upper portion of the shaft, and polishing and painting of the club. |
| Reason: Where the club head or the shaft originates from a country other than the country of assembly of a finished golf club, no substantial transformation occurs in the country of assembly. The head is produced in China because this is where the castings having the rough design of a club head are made, and the head is only subjected to finishing and assembly in Mexico. The character of the cast head remains substantially unchanged and its intended use as a club head is predetermined at the time of its importation in Mexico. Further, the assembly operations in Mexico are a relatively simple assembly process of almost all finished parts and do not substantially transform the shaft, grip, and head. |
| Ruling Date: May 27, 2021 |
H317569: Request for Reconsideration of HQ H311213, dated February 10, 2021; Allocation of Tooling Costs; Proposed Method Rejected
| Ruling: The previous ruling rejecting the method for apportioning tooling costs is affirmed. |
| Issue: Whether CBP properly rejected an importer's method of apportioning tooling costs by use of a “tooling factor” that prorates tooling assists across all imports rather than to the specific product(s)/product line(s) for which the assists were provided. The importer claims that CBP Regulatory Audit approved its predecessor company's use of the same method, and that it is not possible to identify where an individual tool is located. |
| Reason: CBP Regulatory Audit's reports twice took issue with the method for apportioning tooling costs, and once did not mention it in its report, which is not an approval. Based on the information in the importer's 10-K annual report with regard to molds, dies and other tools, the importer keeps records on these for capitalization and amortizing. |
| Ruling Date: April 28, 2021 |
H278604: Request to reconsider NY N255515; Classification of D-Link Wi-Fi smart plugs
| Ruling: CBP correctly classified the smart plugs in heading 8537. |
| Issue: Whether CBP correctly ruled that a Wi-Fi-enabled smart plug device, which are Wi-Fi-enabled switches that connect a user’s home appliances and electronic devices to a Wi-Fi network, allowing the user to turn devices on and off via a mobile app, are classifialble in heading 8537 as articles equipped with two or more apparatus of heading 8535 or 8536. The importer argues they should have been classified in heading 8536. |
| Reason: The subject smart plugs function primarily to control electrical current to connected devices. The components that perform this function, i.e., switches, relays, fuses, contacts, plugs, and sockets, are provided for in headings 8535 and 8536. |
| Ruling Date: May 7, 2021 |
H287183: Application for Further Review of Protest 4701-17-100545; Antidumping Duties; Pasta from Italy
| Origin: The port correctly assessed AD/CV duties at the all others rate pursuant to a prior disclosure filed by Delverde years prior. |
| Issue: Whether CBP correctly assessed AD/CV duties the "all others" rate for entries of pasta from Italy from Delverde in 2007. The Commerce Department in 2014 changed circumstances review (CCR) found Delverde is not the successor of Delverde S.p.A., which had been exempt from the AD duty order, but set an effective date for its determination of entries on or after the date of the final results of its CCR.. |
| Reason: The CCR final results do not mean that Delverde can benefit from Delverde S.p.A.’s rates as if it had been the successor-in-interest prior to the CCR results. Rather, Commerce applies the “all others” rate to entries of merchandise from producers and exporters for which Commerce has not established a company-specific rate. In 2006, when Delverde purchased the assets of the insolvent Delverde S.p.A., Delverde did not seek a company-specific rate. Accordingly, Commerce did not name Delverde in its instructions to CBP to receive a company-specific rate and thus, the actual loss to the Government was the “all others” rate applicable to Delverde’s entries. |
| Ruling Date: March 26, 2021 |