CLA-2-91:OT:RR:NC:N5:113
Mr. William Beames
Timex Group USA
555 Christian Road Middlebury, CT 06762
RE: The tariff classification and country of origin of a bracelet and a watch head
Dear Mr. Beames:
In your letter dated October 30, 2024, you requested a tariff classification and country of origin determination ruling. Product descriptions and photographs of the bracelet and watch head were submitted for our review.
The merchandise under consideration is described in your letter as a wrist bracelet that has a working quartz analog watch head attached to it. The attachment is not permanent and can be removed. The interlocking chain bracelet is comprised of stainless steel and is made in China. The detachable watch head features a round dial with a minute hand and an hour hand, and a 20 mm stainless steel spherical watch case. The watch head will have no jewels, one jewel, two jewels, or three jewels in the movement that is made in Japan. The watch head will be connected to the bracelet by a lobster clasp. The country of assembly of the finished product will be China or the Philippines. The product will be imported with the watch head already attached to the bracelet.
The applicable subheading for the watch head that has no jewels or only one jewel in the movement will be 9102.91.40, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Wrist watches, pocket watches and other watches, including stop watches, other than those of heading 9101: Other: Electrically operated: Other: Having no jewels or only one jewel in the movement. The rate of duty will be 40 cents each plus 6 percent on the case plus 5.3 percent on the battery.
The applicable subheading for the watch head that has two or three jewels in the movement will be 9102.91.80, HTSUS, which provides for Wrist watches, pocket watches and other watches, including stop watches, other than those of heading 9101: Other: Electrically operated: Other: Other. The rate of duty will be 76 cents each plus 6 percent on the case plus 5.3 percent on the battery.
The applicable subheading for the bracelet will be 7117.19.9000, HTSUS, which provides for imitation jewelry: of base metal, whether or not plated with precious metal: other: other: other. The rate of duty will be 11 percent ad valorem.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 7117.19.9000, HTSUS, unless specifically excluded, are subject to an additional 7.5 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.15, in addition to subheading 7117.19.9000, HTSUS, listed above.
The HTSUS is subject to periodic amendment so you should exercise reasonable care in monitoring the status of goods covered by the Note cited above and the applicable Chapter 99 subheading. For background information regarding the trade remedy initiated pursuant to Section 301 of the Trade Act of 1974, you may refer to the relevant parts of the USTR and CBP websites, which are available at https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions and https://www.cbp.gov/trade/remedies/301-certain-products-china, respectively.
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/.
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 courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff'd, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982).
However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987).
Regarding the country of origin of watches, HQ 306338 dated May 14, 2021, stated that CBP's long-standing position has been that the origin of a watch (excluding the strap, band or bracelet) is the country of assembly of the watch movement. Although the addition of the hands, dial, case or watchband may add definition to the timepiece, it does not substantially change the character or use of the watch movement, which is the essence of the watch. The country of assembly of the watch movement in the subject watch head is Japan, therefore, the country of origin of the watch head is Japan. You stated the country of origin of the bracelet will be China.
To determine whether a substantial transformation occurs when components of various origins are assembled into completed products, all factors such as the components used to create the product and manufacturing processes that these components undergo are considered in order to determine whether a product with a new name, character, and use has been produced. No one factor is decisive, and assembly operations that are minimal will generally not result in a substantial transformation.
Based on the information provided in your letter, the country of origin of the bracelet is China, and the country of origin of the watch head is Japan. Regarding the assembly process performed to arrive at the product in condition as imported into the United States, you stated that the removable watch head will be connected to the bracelet by a lobster clasp. The country of assembly of the finished product will be China or the Philippines. The product will be imported with the watch head already attached to the bracelet.
Regarding the country of origin for the bracelet with the watch head attached, it is the opinion of this office that the bracelet and watch head have not undergone enough of a change in China or the Philippines to afterwards emerge with a new name, character, and use that is different from what they possessed prior to the assembly process. Therefore, the minor/minimal assembly operation performed in China or the Philippines which merely attaches the removable watch head to the bracelet does not substantially transform the bracelet and watch head into a new and different article of commerce with a changed character and use. Therefore, the country of origin of the bracelet will be China and the country of origin of the watch head will be Japan.
Since the bracelet with the watch head attached has two separate countries of origin, one of which is China, the value of the stainless steel bracelet from China must be separately broken out on the entry forms in order that Customs and Border Protection can determine the amount of the 301 trade remedy duties that would be assessed on the product.
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 Ann Taub at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division