CLA-2-90:OT:RR:NC:N1:105
Nathan Besh Besh Consulting Pty Ltd, Trading as NateChrony 7 Broughton Place Davidson 2085 Australia
RE: The tariff classification and country of origin of a ballistic chronograph
Dear Mr. Besh:
In your letter dated March 19, 2024, you requested a tariff classification, country of origin, marking, and United States-Australia Free Trade Agreement determination ruling. Descriptive literature was provided for our review.
The item under consideration is described as the NateChrony, which is a ballistic chronograph that is attached to the barrel of an air rifle (non-powder burning devices) to measure the velocity of the projectile. The chronograph is either screwed on, if the barrel is threaded, or clamped on, if it is an unthreaded barrel. The device is powered via a USB cable from a separately imported USB power bank or portable device. The data collected from the NateChrony is used to measure pellet speed as well as calculate trajectory information, and is displayed via website on a connected device. Additional information includes minimum speed and power, maximum speed and power, average speed and power, spread of speed and power, and standard deviation of speed and power. The device provides measurements in both metric and imperial units including feet per second (meters per second), foot pounds (joules), and grains (grams). The chronograph contains two infrared photologic sensors at each end of the device that include multiple electronic components packed into the single integrated sensor. The sensor has a photodiode with additional processing circuits to enable it to act as an electrical switch that is triggered by infrared. In operation, the pellet passes through the first sensor, which will detect the pellet, and measures the time it takes to get to the second sensor before providing the calculations.
The applicable subheading for the NateChrony ballistic chronograph will be 9031.49.9000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Measuring or checking instruments, appliances and machines, not specified or included elsewhere in this chapter; profile projectors; parts and accessories thereof: Other optical instruments and appliances: Other: Other. The general rate of duty will be free.
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/.
Regarding the United States-Australia Free Trade Agreement (UAFTA) eligibility, General Note (GN) 28(b), HTSUS, sets forth the criteria for determining whether a good is originating under the UAFTA. GN 28(b), HTSUS, states in pertinent part that:
For the purposes of this note, subject to the provisions of subdivisions (c), (d), (m) and (n) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good of a UAFTA country under the terms of this note only if:
(i) the good is a good wholly obtained or produced entirely in the territory of Australia or of the United States, or both;
(ii) the good was produced entirely in the territory of Australia or of the United States, or both, and
(A) each of the non-originating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (n) of this note;
(B) the good otherwise satisfies any applicable regional value content requirement referred to in subdivision (n) of this note; or
(C) the good meets any other requirements specified in subdivision (n) of this note;
and such good satisfies all other applicable requirements of this note;
(iii) the good was produced entirely in the territory of Australia or of the United States, or both, exclusively from materials described in subdivision (b)(i) or (b)(ii) of this note; or
(iv) the good otherwise qualifies as an originating good under this note.
In addition, GN 28(c)(iii), HTSUS states that:
A good that has undergone production necessary to qualify as an originating good under this note shall not be considered to be an originating good if, subsequent to that production, the good undergoes further production or any other operation outside the territory of Australia or of the United States, other than unloading, reloading or any other operation necessary to preserve the good in good condition or to transport the good to the territory of Australia or of the United States.
As the good contains non-originating materials, it would have to undergo an applicable change in tariff classification in order to meet the requirements of GN 28(b)(ii). We must refer to GN 28(n) for the specific classification changes required.
For goods classified in subheading 9031.49.9000, GN 28(n)/64(A) requires:
A change to subheadings 9031.10 through 9031.80 from any other heading.
The microprocessor board, circuit board, 3D printer filament and connectors are produced in China. The sensors, screws and resistors are sourced from various countries. In Australia, the various components are soldered to the circuit board, the 3D printed components are manufactured, the chronograph is assembled (screwed into place), the essential proprietary software is created and loaded, the protective coatings are added to the circuit board and all final testing is performed. It is our opinion that all of the non-originating material undergoes the required tariff shifts.
Based on the facts provided, the NateChrony ballistic chronograph is eligible for UAFTA preferential treatment, because it meets the requirements of GN 28(b)(ii).
Regarding the country of origin, 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 19 CFR 134.1(b) 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.
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 determining whether the combining of parts or materials constitute a substantial transformation, the issue is the extent of operations performed and whether the parts lose their identity and become an integral part of a new article. In this instance, the microprocessor board and circuit board are generic boards that have many different uses. The additional soldering of components to the board, the addition of the sensors (allowing for the measurement to occur), the construction and adding of the 3D printed components, and the adding of the proprietary software are all essential items to transform the articles into a working chronograph. Therefore, it is our opinion that the country of origin of the NateChrony ballistic chronograph will be Australia.
Regarding the marking, in your letter, you indicate your intentions to solely utilize the Australian made logo on your packaging. The logo consists of a green triangle with a kangaroo design within the triangle. It is our opinion that the logo alone would not be enough to clearly indicate the country of origin of the chronograph to the end consumers. In lieu of the logo, or in addition to, we suggest utilizing the terms made in Australia on your product. This marking will conform to all U.S. importing laws and clearly identifies the country of origin to the end consumer.
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 Jason Christie at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division