CLA-2-85:OT:RR:NC:N2:212
Nubar Hanessian
Capin Vyborny LLC
949 W Bell Rd Nogales, AZ 85621
RE: The tariff classification and country of origin of electric vehicle charging cables
Dear Mr. Hanessian:
In your letter dated January 25, 2024, you requested a tariff classification and country of origin ruling on behalf of your client, Amphenol Optimize HPS.
There are three items at issue with this request, which are all described as electrical vehicle charging cables. The first is identified by part number HVCO11002L5000 within the family of CCS1 LCC plug. The second item is identified by part number HVCOSAEMACPF516NL1000 of the SAE AC plug family. These two items are presented virtually identically with individual insulated electrical cables bundled together and insulated with a common outer jacket. One end of the cable is terminated with a connector specifically designed to be plugged into an electric vehicle while the other end is unterminated. Within the vehicle connector is a thermistor sensor to prevent overheating and a push switch to detect when the cable is connected and charging the vehicle.
The third item is identified as the NACS T DC cable, which is similarly constructed with slight differences in the plug as it is designed for a different version of electric vehicle. The primary difference is that the plug in this item contains an LED that signals to the user that the cable is connected and charging. Similar to the above-described cables, this item is also unterminated at the opposite end.
After importation, the unterminated end of the cable will be wired into the corresponding charging station. You state that all three cables are rated at or below 1,000 Volts.
We initially address the classification of the subject cables. In your request, you suggest that the correct classification for the cables is under subheading 8544.42.9090, Harmonized Tariff Schedule of the United States (HTSUS). We agree.
The applicable subheading for the electrical charging cables, part numbers HVCO11002L5000, HVCOSAEMACPF516NL1000, and NACS T DC, will be 8544.42.9090, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Insulated (including enameled or anodized) wire, cable (including coaxial cable) and other insulated electric conductors, whether or not fitted with connectors; optical fiber cables, made up of individually sheathed fibers, whether or not assembled with electric conductors or fitted with connectors: Other electric conductors, for a voltage not exceeding 1,000 V: Fitted with connectors: Other: Other: Other.” The general rate of duty will be 2.6% ad valorem.
In your request, you state that the manufacturing process for the subject cables occurs in Mexico. The bundled and insulated cable conductors are manufactured in the US and imported into Mexico in bulk. In Mexico, the cable is cut, stripped, and labelled. The various connector parts, which originate from both China and Mexico, are then assembled onto the ends of the cable to complete the assembly process. The cables are then tested and packaged for export.
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 (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.
The "country of origin" is defined, in pertinent part, in 19 CFR 134.1(b) 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; however, for a good of a NAFTA or USMCA country, the marking rules set forth in part 102 of this chapter (hereinafter referred to as the part 102 Rules) will determine the country of origin.
Pursuant to section 102.0, interim regulations, related to the marking rules, tariff-rate quotas, and other USMCA provisions, published in the Federal Register on July 6, 2021 (86 FR 35566), the rules set forth in §§ 102.1 through 102.18 and 102.20 determine the country of origin for marking purposes with respect to goods imported from Canada and Mexico. Section 102.11 provides a required hierarchy for determining the country of origin of a good for marking purposes, with the exception of textile goods which are subject to the provisions of 19 C.F.R. 102.21. See 19 C.F.R. 102.11.
Applied in sequential order, 19 CFR Part 102.11(a) provides for:
(a) The country of origin of a good is the country in which:
(1) The good is wholly obtained or produced;
(2) The good is produced exclusively from domestic materials; or
(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section 102.20 and satisfies any other applicable requirements of that section, and all other requirements of these rules are satisfied.
The subject cables are neither “wholly obtained or produced” nor “produced exclusively from domestic materials.” Therefore, paragraphs (a)(1) and (a)(2) cannot be used to determine the country of origin of the cables, and paragraph (a)(3) must be applied next to determine the origin of the finished article. As the subject cables are classified under subheading 8544.42, HTSUS, we note the applicable tariff shift requirements in Part 102.20 as:
A change to subheading 8544.42 from any other good of subheading 8544.42, except when resulting from simple assembly, or
A change to subheading 8544.11 through 8544.70 from any other subheading, including another subheading within that group, except when resulting from simple assembly.
In order to determine which of these rules will be used, we must note the classification of the US originating cables imported into Mexico is under subheading 8544.49, HTSUS. As such, we use the second rule stated above. We further note that the non-originating parts are classified outside of heading 8544, HTSUS, thus satisfying the tariff shift rule. As the cable also makes a shift, and the last place of production is Mexico, the origin for marking purposes of the charging cables, part numbers HVCO11002L5000, HVCOSAEMACPF516NL1000, and NACS T DC, will be Mexico.
Though the USMCA origin rules within 19 CFR Part 102 are used to determine the country of origin for marking purposes, the substantial transformation test determines the origin for trade remedy purposes. For tariff purposes, the courts have held that 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. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982).
Based upon the facts presented in this case, it is the opinion of this office that the US originating conductor cable imparts the character of the finished cable and the addition of the connectors does not substantially transform the cable into a new and different article of commerce. As such, the origin for trade remedy purposes will be the United States.
Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 6th and Pennsylvania Avenue, N.W., Washington, D.C. 20508 on the propriety of proposed markings indicating that an article is made in the USA.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided at https://hts.usitc.gov/current.
The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP.
This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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, please contact National Import Specialist Luke LePage at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division