Newly Released CBP HQ Rulings May 6
The Customs Rulings Online Search System (CROSS) was updated May 6 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):
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
H331224: Internal advice; Footwear; Related Parties; Appraisement
| Ruling: The “first sale” transaction value appraisement may be utilized for the transaction between the foreign vendor and the middleman described above. |
| Issue: Whether the merchandise may be appraised based on the “first sale” transaction value between the foreign vendor and the middleman BBUK. |
| Item: In this multitiered transaction, the U.S. importer Burberry Wholesale Limited purchased women's boots from the middleman, Burberry Limited UK (BBUK), a related party. BBUK in turn purchased the merchandise from Maresca, an unrelated footwear producer and vendor in Italy. BBUS “shall be entitled to describe itself as Burberry’s authorised distributor but shall not hold itself out as Burberry’s or the Supplier’s agent or as being entitled to bind Burberry or the Supplier in any way.” The distribution agreement states that the BBUK continues to own the trademark rights after the goods are sold to BBUS and has “the sole and exclusive rights and title of Burberry in and to the Burberry Intellectual Property.” BBUS is responsible for “all freight charges, insurance, customs duties and other governmental fees incurred within the Selling Territory [the United States]” and “for payment of freight from the port of export to the point of importation,” and the merchandise “will be shipped according to Free On Board ('FOB') terms.” The product price invoiced to BBUS is equal to “an arm’s length charge for manufacturing” of the products; “an arm’s length charge of [x]% of their wholesale price in the [United States] for the [BBUK] Intellectual Property embedded in the Products, which have been benchmarked through reference to third-party comparables,” “an arm’s length charge for the sourcing and supply chain function of the Products at cost plus [x]%,” and “all associated freight, logistic, and processing costs incurred in transporting the product to the relevant point of export.” |
| Reason: The documents show the flow of the ordering process from one party to the next, and the flow of the payment process follows a reasonable pattern. The role of the middleman has been adequately explained and there is no indicia of an agency relationship. |
| Ruling Date: March 5, 2024 |
H332922: Internal Advice; Application for Further Review of Protest No. 1704-22-105493; Golf Club Heads; Origin; Section 301
| Ruling: The country origin of the instant golf club heads for purposes of Section 301 remedies is Japan and Section 301 measures don't apply. |
| Issue: What is the country of origin of the subject wedge, iron, and putter golf club heads for purposes of Section 301 measures? |
| Item: Golf club heads for golf irons, wedges and putters classifiable under Harmonized Tariff Schedule of the U.S. subheading 9506.39.0060. The products were forged in the shape of golf heads in Japan and shipped to China to undergo finishing procedures such as polishing, plating, painting, and laser engraving. The finished golf irons, wedges, and putters were then exported to the U.S. from China. |
| Reason: The finishing process in China, which was undertaken for cosmetic purposes, did not effect a substantial transformation of the heads. |
| Ruling Date: March 7, 2024 |