OT:RR:CTF:FTM H309494 MJD
Ms. Carolyn Leski
1010 Niagara Street
Buffalo, NY 14213
Re: Modification of NY N202375; Country of origin of an electronic drum kit
Dear Ms. Leski:
This is in reference to New York Ruling Letter ("NY") N202375, dated February 28, 2012, which was issued to you, on behalf of your client, Efkay USA Music Ltd. In that ruling, U.S. Customs and Border Protection ("CBP") found that the 2box DrumIt Five, item number 11000, electronic drum kit, was classified in subheading 9207.90.0080, Harmonized Tariff Schedule of the United States Annotated ("HTSUSA"), which provides for "[m]usical instruments, the sound of which is produced, or must be amplified, electrically (for example, organs, guitars, accordions): Other: Other." CBP also found that pursuant to the application of the North American Free Trade Agreement ("NAFTA") Marking Rules, contained in 19 C.F.R. Part 102, the country of origin of the electronic drum kit was China.
We have reviewed NY N202375, and determined that it contains an error pertaining to the country of origin of the electronic drum kit, since the country of origin for marking purposes should not have been determined under the NAFTA Marking Rules. This ruling serves to modify NY N202375 with regard to the country of origin. CBP's determination with respect to the classification of the electronic drum kit in NY N202375 is not affected by this action.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. No. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed action was published on March 10, 2021, in Volume 55, Number 9, of the Customs Bulletin. CBP did not receive any comments in response to this notice.
NY N202375 described the electronic drum kit as follows:
The merchandise under consideration is the 2box DrumIt Five, item number 11000. The DrumIt Five is an electronic drum kit comprised of various integrated components, including drum pads, cymbals, pedals, stands, and a control unit. From the information you provided, the user strikes the drum pads and other components as one would an analog drum kit; however, this signal is sent through wires to the control unit, referred to as the "Brain Box," and is made audible through headphones and/or other audio output connected to the Brain Box. The Brain Box also allows the user to choose the sounds each component plays when struck, as well as providing a practice metronome and various other customizable options.
The electronic drum kit consist of various parts that are packaged together in Sweden without the need for further processing. The instrument is imported to the United States from Sweden unassembled. The electronic drum kit consist of the following parts from China, Taiwan, and Sweden:
[The] part number 10021 10" DrumIt drum pad Mk2, part number 10014 12" DrumIt drum pad Mk2, part number 10026 14" DrumIt kick assembly Mk2, part number 10144 DrumIt stand w/o pedals Mk2, part number 10250 upgrade standkit to Mk2, part number 10203 cymbal set, which includes part numbers 10222 Hi-hat cymbal and 10200 ride cymbal, and part number 11002 cable set of 4x4 pcs are all made in China, while part number 10246 pedal set with snare stand is made in Taiwan, and part number 11001 DrumIt Five Unit Brain is made in Sweden. Also included is a power source made in China for which a part number is not given.
In NY N202375, CBP found that the country of origin of the electronic drum kit was China by applying the NAFTA Marking Rules set forth in 19 C.F.R. Part 102. As the electronic drum kit is made primarily from Chinese, Taiwanese, and Swedish components, packaged together as an unassembled drum kit in Sweden, the NAFTA Marking Rules do not apply to this case. Instead, Part 134, Customs Regulations (19 C.F.R. Part 134), implementing the country of origin marking requirements and exceptions of section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provide the appropriate rules in determining the country of origin marking of the electronic drum kit. Accordingly, since 19 C.F.R. Part 102 applies only to goods from Mexico, Canada, and the United States, we are modifying NY N202375.
What is the country of origin marking of the electronic drum kit in question?
LAW AND ANALYSIS:
The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304) provides that, unless excepted, every article of foreign origin imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or container) will permit in such a manner as to indicate to an ultimate purchaser in the United States the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was that the ultimate purchaser should be able to know by an inspection of the markings on the imported goods the country of which the good is the product. "The evident purpose is to mark the goods so at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will." United States v. Friedlaender & Co., 27 C.C.P.A. 297 at 302 (1940).
The country of origin marking requirements and the exceptions of 19 U.S.C 1304 are set forth in Part 134, Customs Regulations (19 C.F.R. Part 134). Section 134.1(b), Customs Regulations (19 C.F.R. 134.1 (b)), defines "country of origin" 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." A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, and use, which differs from the original material subjected to the process. United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267 (C.A.D. 98) (1940); Texas Instruments v. United States, 681 F.2d 778, 782 (1982).
In determining whether the combining of parts or materials constitutes a substantial transformation, the determinative issue is the extent of the operations performed and whether the parts lose their identity and become an integral part of the new article. Belcrest Linens v. United States, 6 CIT 204, 573 F. Supp. 1149 (1983), aff'd, 741 F.2d 1368 (Fed. Cir. 1984). If the manufacturing or combining process is a minor one that leaves the identity of the imported article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983). In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. The country of origin of the item's components, extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, or use are primary considerations in such cases. No one factor is determinative.
In the instant case, all of the components of the electronic drum set are made in China except for the part number 10246 pedal set with snare stand made in Taiwan, and part number 11001 DrumIt Five Unit Brain which is made in Sweden. The electronic drum kit is packaged together in Sweden as an unassembled drum kit without further processing. These components are not assembled. Mere packaging of components does not substantially transform any of the components. As such, the main components from China, Taiwan, and Sweden are not substantially transformed in Sweden as they do not emerge with a new name, character, and use. Thus, each component retains its original origin. See Headquarters Ruling Letter ("HQ") H309106, dated April 15, 2020; HQ 733301, dated August 8, 1990 (". . . packaging alone is not a substantial transformation . . . ."); and, HQ 733729, dated January 2, 1991. Therefore, we find that the country of origin marking of the electronic drum kit is China, Taiwan, and Sweden.
Based on the facts provided, the country of origin marking of the unassembled electronic drum set, packaged in Sweden, are China, Taiwan, and Sweden.
EFFECT ON OTHER RULINGS:
NY N202375, dated February 28, 2012, is hereby MODIFIED.
In accordance with 19 U.S.C. 1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
For Craig T. Clark, Director
Commercial and Trade Facilitation Division