CLA-2-48:OT:RR:NC:4:434
Tao Xiaohua
NuCare LLC
1545 Brunswig Lane
Emeryville, CA 94608
RE: A country of origin determination on paper tray covers
Dear Mr. Xiaohua:
In your letter, dated May 23, 2024, you requested a country of origin ruling for the purpose of duty calculation. A detailed description of the paper tray covers and their manufacturing operations were submitted for our review.
The finished goods to be imported are rectangular paper tray covers used to line trays in medical settings to help prevent cross-contamination and water seepage into equipment and tray surfaces. They will be available in eight sizes, ranging from 5 x 8 up to 11 x 17.25, and will come in several colors.
First, we must address classification. The applicable subheading for the tray covers will be 4818.90.0080, Harmonized Tariff Schedule of the United States (HTSUS, which provides for handkerchiefs, cleansing tissues, towels, tablecloths, table napkins, bed sheets and similar household, sanitary or hospital articles, articles of apparel and clothing accessories, of paper pulp, paper, cellulose wadding or webs of cellulose fibers: Other: Other. The 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 on the World Wide Web at https://hts.usitc.gov/current.
You also requested a country of origin determination for the purposes of duty. In your letter, you describe a scenario wherein parent rolls of paper made in Indonesia are sent to China, where they will be further manufactured into their final form. This manufacturing will consist of dying the paper, cutting it to size (length and width), and packaging for sale.
Section 304 of the Tariff Act of 1930 (19 U.S.C. 1304), provides that unless excepted, every article of foreign origin 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.
Part 134, U.S. Customs and Border Protection (CBP) Regulations (19 C.F.R. Part 134), implements the country of origin marking requirements of 19 U.S.C. 1304. Title 19, Section 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 this part; .
The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that an article used in manufacture which results in an article having a name, character or use differing from that of the constituent article will be considered substantially transformed. If the manufacturing process is a minor one, which leaves the identity of the imported article intact, a substantial transformation has not occurred. See Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (1982), aff'd per curiam, 702 F.2d 1022 (Fed. Cir. 1983).
It can also be informative to research existing rulings. HQ W967997 (10/5/06) determined that tissue paper that was printed, cut to size, and folded had not undergone a substantial transformation. H306091 (2/18/20) ruled that a parent roll of paper that was transformed into sticky notes by cutting to size and applying adhesive had not undergone a substantial transformation. Further, New York ruling N333041 (6/13/23) ruled that Indonesia-origin parent rolls of paper converted in China did not undergo a substantial transformation in China.
You propose that the country of origin is Indonesia. We agree. The parent rolls of paper from Indonesia are not substantially transformed when dyed, cut to size, and packaged to form the finished paper products in China. When imported into the United States, the country of origin of these products will be Indonesia.
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 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, contact National Import Specialist Charlene Miller [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division