Newly Released CBP HQ Rulings for June 16
The Customs Rulings Online Search System (CROSS) was updated June 16 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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H312745: USMCA Eligibility; Country of Origin Marking under 19 U.S.C. 1304, and Applicability of Section 301 Trade Remedy Duties to a Lower Bearing Assembly
| USMCA: Does not qualify |
| Marking: Canada |
| Section 301: Products of China subject to tariffs. |
| Item: Lower bearing assemblies for sand and gravel washing machines, consisting of the following major components: stub shaft (China), mounting ring (China), bearing and adapter sleeve (China), bearing housing (China), slinger (U.S.), wear sleeve (China), donut seal (China); gaskets (Canada), oil seal (Taiwan), and clamp plate (Canada). In Canada, the Chinese components are inspected, cleaned, and painted, and not further manufactured in Canada. Next, all components, including the components from the U.S., Taiwan, and Canada are assembled resulting in a complete lower bearing assembly. |
| Reason: Several of the parts used to make the lower bearing assemblies do not undergo a change tariff classification, and the applicable USMCA tariff shift rule is not satisfied. Additionally, almost 84 percent of the material costs are attributable to China. Accordingly, the regional value content of the lower bearing assemblies does not meet USMCA requirements. The 19 CFR 102 the tariff shift rule is not met for marking purposes. No single component imparrts the assembly's essential character. As the last production process to put together the various components of the lower bearing assemblies into the finished product occurs in Canada, the lower bearing assemblies will be considered products of Canada for the country of origin marking. But the assembly of the components and the other work performed in Canada is not sufficiently “complex and meaningful” to result in a change in the name, character, and use of the Chinese and the other non-Canadian components of the lower bearing assemblies for Section 301 purposes. |
| Ruling Date: June 15, 2021 |
H315298: Country of origin of an Automotive Armrest; Section 301 Trade Remedy; Marking
| Section 301: Does not apply. |
| Marking: Mexico |
| Item: An automotive armrest produced from components from Mexico and China. The armrest foam will be formed to shape in Mexico and glued to a Mexican-originating foam reinforcement pad. Together, the foam and pad will provide the internal structure of the complete armrest. Additionally, the main armrest trim will also be produced from raw materials sourced in Mexico (either leather or PVC), which will be die cut to shape and overcast sewn, then sewn to a bristle and a non-woven material also of Mexican origin. |
| Reason: The non-Mexican origin components alone are insufficient to create the automotive armrest and a large portion of the components are of Mexican origin, and key components will be produced in Mexico. When these created components are combined with the non-Mexican components, the non-Mexi.can components will lose their individual identities and become an integral part of automotive armrest, and will be substantially transformed by the processing in Mexico. While no single component gives the armrests their essential character for marking purposes, the operations performed in Mexico will constitute more than “minor processing” and exceed a “simple assembly,” so the country of origin of the automotive armrest is the last country in which the goods underwent production. |
| Ruling Date: June 15, 2021 |
H318898: Sleepwear; Transaction value; Right to make entry
| Ruling: The purchaser may make entry. The merchandise may be appraised using transaction value. |
| Issue: Whether a purchaser of sleepwear has the right to make an entry as an importer of record under the proposed transaction. Whether the transaction value between the purchaser and the unrelated foreign supplier may be used to appraise the merchandise. |
| Reason: The purchaser is a party qualified to be the importer of record. The transaction at issue is not a consignment that would prohibit the use of the transaction value method to appraise the imported merchandise. The sale terms will be FOB foreign country, which means per the Incoterms that the seller fulfills his obligation to deliver when the goods pass the ship’s rail at the foreign port of shipment. The purchaser will assume risk of loss or damage to the goods from that point. The parties are unrelated, so the transaction is presumed to be at arms length. |
| Ruling Date: June 14, 2021 |