CBP Finds China to Be Country of Origin for Lexmark Printers
China is the country of origin for Lexmark printers imported from Mexico for both Section 301 trade duties and country of origin marking, CBP said in a recently released ruling. CBP found that the printer transports incorporated into the printer, which were made in China, were critical for the printer to feed the paper and to print copies, and were the component that imparted essential character, rather than the printed circuit board assemblies, which were assembled in Mexico.
"While it is true that the PCBA together with the firmware allows the operator panel to perform its function, the other subassemblies/printer transports are critical to allow the printer to feed the paper and to accomplish the goal of printing copies," the agency said.
The products at issue were Lexmark MS/MX and CS/CX printers, which are imported in to the U.S. from Mexico, the ruling said. The printers include "monochromatic and color multifunction and single-function machines."
Several of the printers' components are assembled in China. Those parts together form subassemblies called printer transports, which consist of the basic housing and "the associated structures of the printers," CBP said. Those parts, including the laser scanning unit and the power supply unit, are exported to Mexico, where the PCBAs are made and programmed with U.S.-origin firmware. They incorporate several of the components from China, Taiwan, Korea, Malaysia or Japan that are connected to the PCBA, CBP said.
For country of origin marking, the agency said the Chinese printing transports are also the components that "impart the essential character" to the printers for marking purposes.
Under 19 CFR 102.11, the only materials that shall be taken into consideration when considering which component imparts essential character "are those domestic or foreign materials that are classified in a tariff provision from which a change in tariff classification is not allowed under" the relevant Section 102 tariff shift rule.
For the printers, that rule is: "A change to printer units of ADP machines of subheading 8443.31 through 8443.32 from any other good of subheading 8443.31 through 8443.32 or from any other subheading, except from parts and accessories suitable for use solely or principally with the machines of subheading 8443.31 through 8443.32 of subheading 8443.99 when that change is the result of simple assembly, or from subheading 8504.90 or heading 8473, when that change is the result of simple assembly, and except from other units of ADP machines of subheading 8517.62 through 8517.69 or heading 8528 or from subheading 8471.60 through 8472.90 HTSUS."
Here, the rule "will not be satisfied regardless of whether the foreign (Chinese) transports are classified under subheading 8443.31 or 8443.32, HTSUS, or as parts of subheading 8443.99," CBP said. But the PCBAs manufactured in Mexico "would be considered to have undergone the requisite tariff shift rule, and therefore, pursuant to 19 CFR 102.18 would not be materials to be considered in taking into consideration the material that imparts the essential character to the good."
"Even if they were, we find that the Chinese transporters are the components that impart the essential character to the printers," CBP said. "Therefore, the country of origin marking of the printers will be China."