CLA-2-82:OT:RR:NC:N4:415
Mr. M. Jason Cunningham
Sonnenberg & Cunningham, PA
780 Fifth Avenue South, Suite 200
Naples, FL 34102
RE: The country of origin of various utility knifes.
Dear Mr. Cunningham:
In your letter dated December 6, 2019, you requested a country of origin ruling on behalf of your client, Great Star Industrial USA, LLC.
The products under consideration are generally similar handheld utility knives made of aluminum or zinc, and use a replaceable disposable steel blade that is retractable into the handle through the use of a sliding control knob. None of the utility knives presented would have a folding blade. In your submission, you indicated the disposable blades would be from China, but could be sourced globally. Additionally, when the disposable blades are consumed, consumers may purchase any standard blade from any country of origin to continue using the utility knife. The disposable blades are not permanently attached to the handle. You presented two scenarios for these utility knives.
In the first scenario, in Vietnam, raw aluminum blocks (or potentially zinc) from Vietnam, or a third country, other than China, are die cast to make the left and right sides of the utility knife’s handle body. They are drilled and formed into final shape, ready for assembly. Before shipment to China, they are polished. In China, they are powder coat painted and assembled together using small Chinese origin parts including a blade holder, metal switch, and polyvinyl chloride (PVC) grip. However, in this case, the final version may or may not have the soft grip.
In the second scenario, the utility knife body is made in Vietnam, then finished in China. In Vietnam, raw aluminum (or potentially zinc) from Vietnam or a third country, other than China, is melted then die cast into the two principal parts of the utility knife handle. The castings are separated then die cut, so that all assembly holes, switch locations, twine notch, and hinges are in place for assembly. In China, the two Vietnamese origin pieces are painted, then assembled together with the blade holders, disposable blade(s), switches, springs, pins, screws, and soft grip cover before retail packaging and export to the United States.
With regard to the appropriate country of origin marking of these utility knives, section 304, Tariff Act of 1930, as amended (19 USC 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article.
Certain types of articles must be marked in a specified manner as required by 19 CFR 134.43. Knives are specifically identified in this regulatory provision as articles that must be marked legibly and conspicuously by die stamping, cast-in-the-mold lettering, etching, or engraving. However, U.S. Customs and Border Protection (CBP) has previously ruled that such articles may be excepted from individual marking if the marking of their containers will reasonably indicate the origin of the articles pursuant to 19 CFR 134.32(d).
Pursuant to Part 134, Customs Regulations (19 CFR 134) implements the country of origin marking requirements and exceptions of 19 USC 1304. Section 134.1(b), Customs Regulations (19 CFR 134.1(b)), defines “country of origin” as: “[t]he 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 occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. A substantial transformation will not result from a minor manufacturing or combining process that leaves the identity of the article intact. See National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993).
In order to determine whether a substantial transformation occurs when components 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/manufacturing operations that are minimal will generally not result in a substantial transformation.
As part of this analysis, we must also consider the definition of a knife. As per Merriam-Webster, a knife is defined as “a cutting instrument consisting of a sharp blade fastened to a handle” or “a weapon or tool resembling a knife.” An article without a blade or the ability to cut would not be a knife and in regards to these utility knives, without the utility knife blade, the product would merely be a handle or a part of the finished knife.
In Headquarters Ruling Letter (HQ) 559782, dated May 24, 1996, CBP considered the origin of a utility knife. All of the knife’s parts were of U.S.-origin, except the two parts that made up the knife body. CBP found that, as a result of having been assembled with the domestic parts, the imported casting parts underwent a change in name to a utility knife. CBP also found that the imported parts underwent a change in character as it was only after the domestic assembly of the imported casting parts with other domestic parts that the essence of a knife was created - meaning the body became an article capable of carrying and retracting the blade to a useable or safe position and housing extra blades. CBP noted that, although the two imported parts were dedicated to become the body of the utility knife, they did not themselves represent the very essence of the finished utility knife. CBP also stated that while the blade was necessary in the operation of the utility knife, for this type of metal utility knife, neither the blade, nor the body alone imparted the very essence of the utility knife.
In the first scenario, there appears to be two options with and without the disposable blades. Without the addition of the blades, this product would be a utility knife handle body and would remain as a part of the completed knife and would not be considered a knife until it can cut. In this instance, this office is of the opinion that the country of origin for the utility knife handle body would be Vietnam as the essential character of the handle is derived in Vietnam and the process that follows in China would be deemed simple assembly. If the blades are included with the handle, this product would be substantially transformed from a handle to a functioning knife, capable of carrying and retracting the blade to a useable or safe position. The country of origin of the functioning knife is China, where the Vietnamese body is assembled with the Chinese origin blade and blade holder.
In the second scenario, it would be similar to the above in that the blade and blade holder are what transform this article from a handle to a completed knife. The country of origin in this scenario would also be China.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR 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 Kristopher Burton at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division