Newly Released CBP HQ Rulings for May 27
The Customs Rulings Online Search System (CROSS) was updated May 27 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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H312417: Request regarding valuation methodology for fabricated metals; Computed Value; 19 C.F.R. § 152.103(e); Reconciliation
| Ruling: The proposed method of determining the costs of fresh metals used in the production of the imported coil alloys and the use of the Reconciliation Program for ascertaining the actual valuation of the imported coil alloys under computed value appears reasonable and is acceptable to CBP. |
| Issue: Whether an importer of coil sheet metal alloys can use the computed value method of appraisement, and then file reconciliation entries as certain information regarding the value calculation is not known at the time of entry. The merchandise is ineligible for transaction value because the relationship between buyer and seller influences price. Due to the nature of the production process, the sale of fresh metal used in production to the importer may occur months before the sale and shipment of the coil alloys. The supplier does not know the cost of fresh metal used per shipment of coil alloys, but can determine the amount of fresh metal used in shipped coil alloys and the amount paid by the buyer for the fresh metal used in producing the coil alloys over a period of time, such as, at the end of the supplier’s fiscal year. |
| Reason: The importer intends to use the information required by the statute to determine the computed value of the imported coil alloys. The information regarding the costs of the fresh metals is recorded in the books of the supplier in accordance with the applicable GAAP, so the use of reconciliation is reasonable and acceptable. |
| Ruling Date: May 5, 2021 |
H317502: Applicability of subheading 9802.00.60 and country of origin of alloy steel coils imported from Germany
| Ruling: The steel coils may be classified under subheading 9802.00.60 with duty assessed only on the value of the processing performed outside the U.S., and are goods of the U.S. not subject to Section 232 tariffs. |
| Issue: Whether alloy steel coils exported for processing in Germany before reimportation are eligible for a partial duty exemption under subheading 9802.00.60; are subject to section 232 duties only on the value of the processing performed abroad; and are subject to anti-dumping duties under Case Number A-428-843. The products under consideration are alloy steel coils measuring from 660 mm to 1270 mm in width and .2 mm to 1.0 mm in thickness, made to ASTM A677, which is the Standard Specification for Nonoriented Electrical Steel Fully Processed Types. The processing in Germany consists of annealing and coating with an insulated varnish. The alloy steel coils meet that ASTM A677 standard after being processed in Germany. However, at the time of export from the U.S., the steel coils are dedicated for the annealing and coating process. |
| Reason: All four requirements for classification in subheading 9802.00.60 are met: (1) the merchandise must be an article of metal; (2) the metal must either be manufactured in the United States or subject to a process of manufacture in the United States; (3) the metal must be exported for further processing; and (4) the metal must be returned to the United States for further processing. The steel is intended for electrical use upon exportation to Germany, and the annealing and coating process merely furthers such use. Therefore, the alloy steel coils do not undergo a substantial transformation in Germany and remain products of the United States. As U.S. products, the alloy steel coils are not subject to section 232 duties upon their return, Scope ruling requests should be addressed to the Commerce Department. |
| Ruling Date: March 26, 2021 |
H317381: Application for Further Review of Protest 2408-20-100195; NAFTA Certificate of Origin; Polypropylene Bags
| Ruling: The NAFTA certificate should not be accepted, and the goods do not qualify for NAFTA treatment. |
| Item: Whether a NAFTA Certificate of Origin submitted with a protest should be accepted to verify the NAFTA claim for an entry of polypropylene bags. The importer said it was originally unable to provide the certificate in response to an origin verification because its employees were working from home due to the COVID pandemic, and that the certificate was in the possession of its supplier in Mexico. |
| Reason: An importer who makes a claim and declaration for NAFTA preferential tariff treatment upon importation must have a properly executed and valid certificate of origin in its possession at the time the claim and declaration are made. If an importer does not have a properly executed and valid certificate of origin in its possession at the time its claim and declaration are made for NAFTA preferential tariff treatment, the port director may deny preferential tariff treatment to the imported goods covered by the claim and declaration. Although the importer and manufacturer are related parties, this does not negate the requirement in the regulations that the importer have in its possession a valid certificate of origin. In this case, the importer did not have the certificate of origin in its possession. It was in the possession of the factory. |
| Ruling Date: March 19, 2021 |
H314982: U.S. Government Procurement; Title III, Trade Agreements Act of 1979 (19 U.S.C. 2511); subpart B, Part 177, CBP Regulations; Country of Origin of a Transceiver
| Origin: Not a product of Australia or any other foreign country or instrumentality. |
| Item: A software-defined based, single-sideband (“SSB”) transceiver. The transceiver’s control head features a graphical user interface on a touchscreen that can be detached from the main body of the transceiver for remote control. The transceiver can also be controlled remotely from most mobile and desktop platforms. There are three main assemblies for each transceiver: (1) the control head assembly; (2) the power amplifier (PA) assembly and chassis; and, (3) the microprocessor board and interface board assembly and chassis. Within these three main assemblies are five printed circuit board assemblies (PCBAs). The five PCBAs and the countries in which each PCBA is produced are as follows: the control head board (United States); the interface board (United States); the micro board (Australia); the PA board (Australia); and the volume control board (Australia). Prior to export to the United States, the only software installed on the boards produced in Australia is for the limited purpose of testing and diagnostics. The Australian produced boards are non-functional at the time of importation into the United States. In addition to the PCBAs, each transceiver includes, a radio chassis, a speaker, an LCD screen, looms, various molded plastic parts including dials and buttons, and various seals and fasteners. The transceiver is assembled in the United States from imported and domestically produced components. |
| Reason: The PCBAs for the control head board and the interface board, PCBAs which CBP considers to be dominant as they are within components which are essential to the functioning of the transceiver, are assembled in the United States. The conversion of the Australian software into executable code, which occurs in the United States, and programming of the transceiver boards is additional work to be considered in assessing the proper origin of the finished transceiver. |
| Ruling Date: Feb. 25, 2021 |