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(i) For purposes of this note, originating materials from the territory of either Singapore or the United States that are used in the production of a good in the territory of the other country shall be considered to originate in the territory of such other country.
(ii) A good is an originating good when it is produced in the territory of Singapore or of the United States, or both, by one or more producers, provided that the good satisfies all of the applicable requirements of this note.
(g) Regional value content.
(i) Where a rule set forth in subdivision (o) of this note specifies a regional value content for a good, the regional value content of such good shall be calculated, at the choice of the person claiming the tariff treatment authorized by this note for such good, on the basis of one of the following methods, unless otherwise specified herein:
(A) For the build-down method, the regional value content may be calculated on the basis of the formula RVC = ((AV - VNM)/AV) x 100, where RVC is the regional value content, expressed as a percentage; AV is the adjusted value; and VNM is the value of non-originating materials that are acquired and used by the producer in the production of the good; or
(B) For the build-up method, the regional value content may be calculated on the basis of the formulaRVC = (VOM /AV) x 100, where RVC is the regional value content, expressed as a percentage; AV is the adjusted value; and VOM is the value of originating materials that are acquired or self-produced and are used by the producer in the production of the good.
(ii) Value of materials.
(A) For purposes of calculating the regional value content of a good under subdivision (i) and for purposes of applying the de minimis provisions of subdivision (e) of this note, the value of a material is:
(1) in the case of a material imported by the producer of the good, the adjusted value of the material;
(2) in the case of a material acquired in the territory where the good is produced, except for a material to which subdivision (3) below applies, the adjusted value of the material; or
(3) in the case of a material that is self-produced, or in a case in which the relationship between the producer of the good and the seller of the material influenced the price actually paid or payable for the material, including a material obtained without charge, the sum of–
(I) all expenses incurred in the production of the material, including general expenses; and
(II) an amount for profit.
(B) The value of materials may be adjusted as follows:
(1) for originating materials, the following expenses, if not included under subdivision (A) above, may be added to the value of the originating material:
(I) the costs of freight, insurance, packing and all other costs incurred in transporting the material to the location of the producer;
(II) duties, taxes and customs brokerage fees on the material paid in the territory of Singapore or of the United States, or both, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or tax paid or payable; and
(III) the cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or by-product; and
(2) for non-originating materials, if included under subdivision (A) above, the following expenses may be deducted from the value of the nonoriginating material:
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(I) the costs of freight, insurance, packing and all other costs incurred in transporting the material to the location of the producer;
(II) duties, taxes and customs brokerage fees on the material paid in the territory of Singapore or of the United States, or both, other than duties and taxes that are waived, refunded, refundable or otherwise recoverable, including credit against duty or tax paid or payable;
(III) the cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or by-products;
(IV) the cost of processing incurred in the territory of Singapore or of the United States in the production of the non-originating material; and
(V) the cost of originating materials used in the production of the nonoriginating material in the territory of Singapore or of the United States.
(h) Accessories, spare parts and tools.
Accessories, spare parts or tools that are delivered with a good and that form part of the good's standard accessories, spare parts or tools shall be treated as originating goods for purposes of this note if the good is an originating good, and shall be disregarded in determining whether all the nonoriginating materials used in the production of the good undergo an applicable change in tariff classification specified in subdivision (o) of this note, provided that:
(i) the accessories, spare parts or tools are not invoiced separately from the good;
(ii) the quantities and value of the accessories, spare parts or tools are customary for the good; and
(iii) if the good is subject to a regional value-content requirement, the value of the accessories, spare parts or tools shall be taken into account as originating or non-originating materials, as the case may be, in calculating the regional value content of the good under subdivision (g) of this note.
(i) Fungible goods and materials.
(i) A person claiming the treatment provided in this note for a good may claim that a fungible good or material is originating either based on the physical segregation of each fungible good or material or by using an inventory management method. For purposes of this subdivision, the term “inventory management method” means:
(A) averaging,
(B) “last-in, first-out,”
(C) “first-in, first out,” or
(D) any other method that is recognized in the generally accepted accounting principles of the country in which the production is performed (whether Singapore or the United States) or otherwise accepted by that country.
The term “fungible goods” or fungible materials” means goods or materials, as the case may be, that are interchangeable for commercial purposes and the properties of which are essentially identical.
(ii) A person selecting an inventory management method under subdivision (i) above for particular fungible goods or materials shall continue to use that method for those fungible goods or materials throughout the fiscal year of that person.
(j) Packaging materials and containers.
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(i) Packaging materials and containers in which a good is packaged for retail sale, if classified with the good for which the tariff treatment under the terms of this note is claimed, shall be disregarded in determining whether all the nonoriginating materials used in the production of the good undergo the applicable change in tariff classification set out in subdivision (o) of this note and, if the good is subject to a regional value-content requirement, the value of such packaging materials and containers shall be taken into account as originating or non-originating materials, as the case may be, in calculating the regional value content of the good.
(ii) Packing materials and containers in which a good is packed for shipment shall be disregarded in determining whether–
(A) the nonoriginating materials used in the production of the good undergo an applicable change in tariff classification set out in subdivision (o) of this note; and
(B) the good satisfies a regional value-content requirement.
(k) Indirect materials.
An indirect material shall be considered to be an originating material for purposes of this note without regard to where it is produced, and its value shall be the cost registered in the accounting records of the producer of the good. The term “indirect material” means a good used in the production, testing or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including–
(i) fuel and energy;
(ii) tools, dies and molds;
(iii) spare parts and materials used in the maintenance of equipment or buildings;
(iv) lubricants, greases, compounding materials and other materials used in production or used to operate equipment and buildings;
(v) gloves, glasses, footwear, clothing, safety equipment and supplies;
(vi) equipment, devices and supplies used for testing or inspecting the goods;
(vii) catalysts and solvents; and
(viii) any other goods that are not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production.
(l) Record-keeping requirements and verification.
(i) An importer of a good, for which treatment as an originating good of a SFTA country is claimed under the provisions of this note, shall be prepared to submit, upon request by the appropriate customs officer, a statement setting forth the reasons that the good qualifies as an originating good under the provisions of this note, including pertinent cost and manufacturing information, as provided in pertinent regulations.
(ii) Importers shall maintain for a period of five years after the date of importation their records relating to the importation of the good and shall, upon request by the appropriate customs officer, make available records which are necessary to demonstrate that a good qualifies as an originating good under the provisions of this note, including records concerning:
(A) the purchase of, cost of, value of and payment for the good;
(B) the purchase of, cost of, value of and payment for all materials, including indirect materials, used in the production of the good; and
(C) the production of the good in the form in which the good is exported.
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(iii) For purposes of determining whether a good imported into the customs territory of the United States from the territory of Singapore qualifies as an originating good under the provisions of this note, the appropriate customs officer may conduct a verification by means of–
(A) requests for information from the importer;
(B) written requests for information to an exporter or a producer in the territory of Singapore or of the United States;
(C) requests for the importer to arrange for the producer or exporter to provide information directly to the country conducting the verification;
(D) information received directly by the appropriate customs officer from an exporter or a producer as a result of a process described in subdivision (i) above;
(E) visits to the premises of an exporter or a producer in the territory of Singapore or of the United States, in accordance with any procedures that these countries jointly adopt pertaining to the verification, as set forth in pertinent regulations; or
(F) such other procedures as the United States and Singapore may agree, as set forth in pertinent regulations.
(m) Goods that shall be considered originating goods. For the purposes of subdivision (b)(ii) of this note, goods that, in their condition as imported, are classifiable in the tariff provisions enumerated in the first column and are described opposite such provisions, when such goods are imported into the customs territory of the United States from the territory of Singapore, shall be considered originating goods for the purposes of this note:
Heading/Subheading Articles Subject to this Note
(1) 3818 Chemical elements doped for use in electronics, in the form of disks, wafers or similar forms; chemical compounds doped for use in electronics
(2) 7017.10.30, 7020.00.30 Quartz reactor tubes and holders designed for insertion into diffusion and oxidation furnaces for production of semiconductor wafers
(3) 8443.31.00, 8443.32.10, 8443.39.00, Plotters, whether input or output units of the automatic data 8443.99.50, 8471.49.00, 9017.10.40, processing machines of heading 8471 or drawing or drafting 9017.20.70, 9017.90.01 machines of heading 9017
(4) 8443.31.00, 8443.32.50 Facsimile machines
(5) 8443.31.00, 8443.32.10, 8443.99, 8471.60, Input or output units (including printers), whether or not 8528.42.00, 8528.52.00, 8528.62.00 containing storage units in the same housing; parts of printers
(6) 8443.32.50 Teleprinters
(7) 8443.39.10 Electrostatic photocopying apparatus, operating by reproducing the original image directly onto the copy (direct process)
(8) 8443.39.30 Other photocopying apparatus, incorporating an optical system
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(9) 8443.99.25, 8443.99.35, 8443.99.40, Printed Circuit Assemblies for products falling within this 8443.99.45, 8471.50.01, , 8473.21.00, agreement, including such assemblies for external 8473.29.00, 8473.30.11, 8473.40.10, connections such as cards that conform to the PCMCIA 8473.40.21, 8473.50.30, 8486.90.00, standard. Such printed circuit assemblies consist of one or 8504.40.60, 8504.40.85, 8504.90.20, more printed circuits of heading 8534 with one or more active 8504.90.65, 8517.62.00, 8517.70.00, elements assembled thereon, with or without passive 8518.90.20, 8518.90.60, 8522.90.45, elements Active elements means diodes, transistors, and 8531.90.15, 8537.10.91, 8537.20.00, similar semiconductor devices, whether or not photosensitive, 8538.90.10, 8543.70, 8543.90, 9013.90.50 of the heading 8541,and integrated circuits and micro 9017.90.01, 9026.90.20, 9026.90.60, assemblies of heading 8542. 9027.90.45, 9027.90.54, 9027.90.64, 9027.90.84, 9030.90.64, 9030.90.84, 9031.90.54, 9031.90.70 (10) 8443.99.30, 8443.99.35, 8443.99.50, Parts of facsimile machines or teleprinters; parts of the 8517.70.00 apparatus of heading 8517
(11) 8443.99.40, 8443.99.45 Parts and accessories of copying machines
(12) 8470 Calculating machines and pocket-size data recording, reproducing and displaying machines with calculating functions; accounting machines, postage-franking machines, ticket-issuing machines and similar machines, incorporating a calculating device; cash registers
(13) 8471 Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, not elsewhere specified or included
(14) 8471 Automatic data processing machines capable of (1) storing the processing program or programs and at least the data immediately necessary for the execution of the program; (2) being freely programmed in accordance with the requirements of the user; (3) performing arithmetical computations specified by the user; and (4) executing, without human intervention, a processing program which requires them to modify their execution, by logical decision during the processing run (The agreement covers such automatic data processing machines whether or not they are able to receive and process with the assistance of central processing unit telephony signals, television signals or other analogue or digitally processed audio or video signals. Machines performing a specific function other than data processing, or incorporating or working in conjunction with an automatic data processing machines, and not otherwise specified herein, are not covered by this agreement.)
(15) 8471.30.01, 8471.41.01, 8471.49.00, Analogue or hybrid automatic data processing machines 8471.50.01 (16) 8471.49.00, 8471.70.60, 8471.70.90 Optical disc storage units, for automatic data processing machines (including CD drives and DVD drives), whether or not having the capability of writing/ recording as well as reading, whether or not in their own housings (17) 8471.30.01 Portable digital automatic data processing machines, weighing no more than 10 kg, consisting of at least a central processing unit, a keyboard and a display