CLA-2-84:OT:RR:NC:N1:118

Mr. David Newman
Attorney-at-Law
45 Village Gate Way
Nyack, NY 10960

RE: The country of origin of a paper shredder.

Dear Mr. Newman:

In your letter dated September 13, 2019, on behalf of your client, Staples Inc., you requested a ruling on the country of origin for an 8-sheet cross-cut paper shredder, which is presently designated with item numbers TR-BMC8A-US and TR-BMC8-CC, depending on sales channel. The paper shredder will be produced in a Vietnam factory from material and components sourced from China and Vietnam.

You state in your submission that the majority of the parts and components of the paper shredder will be sourced from China. However, significant subassemblies and assemblies will be produced in a Vietnam factory. The cutter subassembly will be assembled with individual ring-like blades (Chinese origin), spaced apart by cutter rings (Vietnamese origin) and secured on two shafts by circular clip fasteners (Chinese origin). This subassembly is further assembled with plates, a paper guide, gears and gearbox parts into the inter-machine assembly responsible for performing the physical shredding of paper. You further state that the shredder paper bin, consisting of a frame (handles and frame plates) and injection-molded bin, is sourced entirely from Vietnam.

Also assembled in Vietnam, is the printed circuit assembly (also known as a printed circuit module). This assembly is produced by mounting numerous electronic components on a bare printed circuit board. Such electronic components include a microcomputer, different types of diodes, capacitors, resistors, switches, cables and lights (LEDs). The printed circuit assembly controls the entire operation of the shredder.

With regard to your request for the appropriate country of origin of the paper shredder, 19 C.F.R. § 134.1(b) provides in pertinent part as follows:

Country of origin means 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;

The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character or use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993).

In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, all factors such as the components used to create the product and manufacturing processes that these components undergo are considered in order to determine whether a product with a new name, character and use has been produced. No one factor is decisive, and assembly operations that are minimal will generally not result in a substantial transformation.

It is our view that the production of the subassemblies and assemblies in Vietnam constitutes a substantial transformation of the Chinese materials and components. The fabrication and production of the paper shredder’s critical assemblies and subassemblies constitute meaningful assembly operations, which transform the Chinese originating components and materials into a finished product. This creates a new and different article of commerce with a distinct character and use that is not inherent in the components when they are imported into Vietnam. Therefore, it is the opinion of this office that the country of origin of the 8-sheet cross-cut paper shredder is Vietnam.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Anthony E. Grossi at [email protected].

Sincerely,

Steven A. Mack
Director
National Commodity Specialist Division