VAL RR:IT:VA 546612 CRS
Ms. Angel L. Cooper
A.N. Deringer, Inc.
173 W. Service Road
Champlain, NY 12919
RE: Article 509; NAFTA; advance ruling
Dear Ms. Cooper:
This is in reply to your request for an advance ruling pursuant to Article 509 of the North American Free Trade Agreement (the "NAFTA"), as to whether certain laser-based, structured light products produced in Canada by Lasiris Inc. qualify as originating goods.
FACTS:
Lasiris, Inc., a Canadian company, produces laser-based, structured light products from both originating and non-originating materials. The instant request concerns two products: a laser-based, single-line generator, model no. SNF-501L-670-10?; and a laser-based, single-dot pointer, model no, DLS-500-670-1 (collectively, the "goods"). In DD 897934, dated May 31, 1994, these models were classified in subheading 9013.80.6000, Harmonized Tariff Schedule of the United States (HTSUS).
You have advised that all the non-originating materials used in the production of the goods are classified elsewhere than in heading 9013, HTSUS. In particular, you have advised that the following non-originating materials are used in the production of the goods and are classified accordingly: a light emitting diode, classified in subheading 8541.40, HTSUS; an O-Ring, classified in subheading 4016.93, HTSUS; a switch, classified in subheading 8536.90, HTSUS; a potentiometer, classified in subheading 8533.40, HTSUS; a transistor, classified in 8541.40, HTSUS; a battery holder, classified in subheading 8504.90, HTSUS; a collimator, classified in subheading 9001.90, HTSUS; a laser diode chip, classified in subheading 8541.40, HTSUS; a condensator, classified in 8541.60, HTSUS; a regulator, classified in subheading 8533.40, HTSUS; a termistor (sic), classified in subheading 8533.40, HTSUS; a heat sink, classified in subheading 7326.90, HTSUS; a "plug in", classified in subheading 8536.90, HTSUS; a strength relief, classified in subheading 8533.40, HTSUS; and a power concentrator, classified in subheading 8533.40, HTSUS.
In addition, you have advised that all other materials used in the production of the goods qualify as originating goods under the NAFTA Rules of Origin Regulations. These include such items as: wires; glue; screws; Cap DLS; plastic and aluminum holders; focus keys; aluminum tubes; brackets; aluminum heads; X-Y axes; plastic cups; resistors; PCBs; diffraction gratings; glass lenses; Holland keys; batteries; key boxes; electric diodes; connectors; amplifiers; and adaptors.
Finally, you have also provided information in respect of the regional value content of the goods pursuant to the transaction value method. Under this method you state that the single line generator and the single line pointer have regional value contents of, respectively, of 87.35 percent and 82.14 percent.
ISSUE:
The issue presented is whether the goods described above qualify as originating goods for purposes of preferential tariff treatment under the NAFTA.
LAW AND ANALYSIS:
The Appendix to the final NAFTA Rules of Origin Regulations ("ROR"; 19 C.F.R. pt. 181 app.; NAFTA Rules of Origin Regulations, as amended by 60 Fed. Reg. 46,334, 46249, T.D. 95-68, 29:38 Cust. B. & Dec. 1), provides, inter alia, at section 4, that a good originates in the territory of a NAFTA country where: each of the non originating materials used in the production of the good undergoes the applicable change in tariff classification as a result of production that occurs entirely in the territory of one or more of the NAFTA countries, where the applicable rule for the good specifies only a change in tariff classification; or if each of the non originating materials used in the production of the good undergoes the applicable change in tariff classification as a result of production occurring entirely in the territory of one or more of the NAFTA countries and the good satisfies the applicable regional value content requirement, where the applicable rule of origin specifies both a change in tariff classification and a regional value content requirement. ROR, § 4(2)(a)-(b).
In this instance, the applicable rule of origin for a good classified in subheading 9013.80, HTSUS, specifies:
(A) A change to subheadings 9013.10 through 9013.80 from any other heading; or
(B) A change to subheadings 9013.10 through 9013.80 from subheading 9013.90, whether or not there is also a change from any other heading, provided there is a regional value content of not less than:
(1) 60 percent where the transaction value method is used, or
2) 50 percent where the net cost method is used.
19 C.F.R. pt. 181, app., Sched. I, as implemented in General Note 12(t)/90.31 of the HTSUS.
Section 181.93(b)(2)(ii)(B), Customs Regulations, provides in pertinent part that ruling requests involving a change in tariff classification of a material must identify each material which is claimed to be an originating material and provide a complete description of each such material, including the basis of the claim of originating status. (19 C.F.R. § 181.93(b)(2)(ii)(B)). Based on the information submitted, all the non-originating materials used in the production of the goods undergo a change in classification pursuant to the rule of origin set forth in General Note 12(t)/90.31(A). Accordingly, there is no need to consider whether the good originates under the alternative rule of origin.
HOLDING:
Based on the information presented, all the non-originating materials used in the production of the goods at issue undergo a change in classification such that the goods qualify as originating goods under the NAFTA.
This holding applies only to the specific factual situation and merchandise identified in the ruling request. This position is clearly set forth in section 19 C.F.R. § 181.100(a)(2), which states that a NAFTA ruling letter is issued on the assumption that all the information furnished in connection with the ruling request and incorporated therein, directly, by reference, or by implication, is accurate and complete in every respect. In addition, please note that the application of an advance ruling letter by a Customs field office to the transaction to which it purports to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transaction described therein to the actual transaction, and if the facts are materially different, the treatment specified in the ruling letter will not be applied to the actual transaction.
If it is subsequently determined that the information furnished is not complete and/or does not comply with 19 C.F.R. § 181.100(a)(2), this ruling will be subject to modification or revocation. In addition, any change in the facts furnished in connection with this ruling may affect the outcome of the regional value content determination. In such a case, it is recommended that a new ruling request be submitted in accordance with 19 C.F.R. § 181.93.
Sincerely,
Acting Director
International Trade Compliance Division