CLA-2-85:OT:RR:NC:N2:209
Ron Levy
Kintetsu World Express (USA) Inc.
18450 S. Wilmington Ave. Rancho Dominguez, CA 90220
RE: The tariff classification and country of origin of a semiconductor transistor from China
Dear Mr. Levy:
In your letter dated November 1, 2023, you requested a tariff classification and country of origin ruling on behalf of your client ANA Trading Corp. USA.
The merchandise under consideration is a semiconductor chip transistor. This device is made from a silicon carbide metal-oxide-semiconductor field-effect transistor (MOSFET) wafer. This is a wafer that has been manufactured to contain thousands of transistor chips within the wafer. At time of import into the United States, these wafers have been cut into individual transistor chips which are then mounted and packed into separate MOSFETs (individual packaged transistors). The finished article is a 4 terminal transistor with an operating frequency of less than 30 MHz.
The applicable subheading for the individual, mounted/packed 4 terminal transistors (MOSFET) will be 8541.29.0095, Harmonized Tariff Schedule of the United States (HTSUS), which provides for "Semiconductor devices (for example, diodes, transistors, semiconductor-based transducers)…: Transistors, other than photosensitive transistors: Other: Other: Other." The general rate of duty will be free.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided at https://hts.usitc.gov/current.
Regarding the country of origin of the individual, mounted/packed 4 terminal transistors (MOSFET), the front-end manufacturing process takes place within the United States and back-end manufacturing process takes place within China.
The wafers are produced in the United States from thin-sliced purified metal (Silicon Carbide). The wafers undergo a photo-mask process which creates the circuit pattern for each individual die. The wafer is beyond just being doped, as it has been photo-masked and now contains all the circuitry needed to function as intended. No additional circuit processing is needed.
The finished wafer is then shipped to China for the backend processing. Within China, the wafer is first inspected. Then the wafer is sawn into individual dies. Each individual die is attached to a copper lead-frame, and undergoes a wire bonding process. Next, the transistor assembly is over molded/encapsulated which creates the outer package. Finally, each transistor is tested. The finished transistors are then shipped to the United States.
A complete explanation of the manufacturing process has been submitted.
The marking statute, section 304, 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 U.S. 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 the ultimate purchaser in the U.S. the English name of the country of origin of the article.
The "country of origin" is defined in 19 CFR 134.1(b) 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 this part."
The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character or use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982).
This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff'd, 989 F.2d 1201 (Fed. Cir. 1993).
Based upon the facts presented, it is the opinion of this office that the front-end manufacturing process that takes place within the United States imparts the character of the finished article. The dies, which were created on the wafer, incorporate their complete electronic circuitry and they are the functional component of the finished transistors. The wafers, (which contain the die incorporating the complete transistor circuitry) manufactured within the United States, do not undergo a substantial transformation as a result of the manufacturing process that takes place in China. They retain their identity as transistors with a predetermined end use. Therefore, since a substantial transformation does not occur as a result of the Chinese manufacturing/assembly process, the country of origin would be the United States at the time of importation into the United States.
Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 6th and Pennsylvania Avenue, N.W., Washington, D.C. 20508 on the propriety of proposed markings indicating that an article is made in the USA.
The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP.
This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, please contact National Import Specialist Steven Pollichino at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division