Marc S. Greenberg
American Shipping Company, Inc.
250 Moonachie Road, 5th Floor
Moonachie, NJ 07074
RE: The country of origin and marking of gaming headsets
Dear Mr. Greenberg:
In your letter dated August 3, 2020, you requested a country of origin ruling on behalf of your client, Voyetra Turtle Beach Inc.
The product that is the subject of this country of origin ruling request is a wireless gaming headset identified as: Stealth 600X.
Voyetra Turtle Beach Inc. is planning to manufacture the gaming headsets within Vietnam.
The manufacturing process that occurs within Vietnam is as follows:
Printed circuit boards (PCBs) which are manufactured in Taiwan are populated with electrical components (i.e. capacitors, resistors, switches, etc.) predominantly from China with additional components coming from Thailand, Japan, Malaysia and Taiwan. A process called Surface Mount Technology (SMT) along with DIP automatic insertion is used to place and connect the components to the PCB forming a printed circuit board assembly (PCBA).
Once the PCBAs are manufactured firmware is then loaded onto each one by trained operators.
Each PCBA is then subjected to extensive testing by skilled operators.
Bulk rolls of electrical cable, plastic resin and connectors from China, are manufactured into USB cable assemblies by cutting specific lengths of cable, affixing the connectors and using an injection mold process to incorporate the cables with the connectors.
Plastic resin from China is used to create the plastic housing, outer shell and various other plastic components using a hot resin injection press manufacturing process.
Audio components, cushions, and various miscellaneous parts and parts of general use made in China and Vietnam are assembled into the product.
Finally the headset is packaged in a retail box with user manual both of which are manufactured in Vietnam.
A detailed explanation of all manufacturing and assembly steps has been provided.
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; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin."
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).
However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987).
Based upon the facts presented, it is the opinion of this office that the manufacturing process that takes place in Vietnam is substantial and complex. The various components are transformed within Vietnam into a different article with a new name, character, and use. They lose their separate identities and become an integral part of a new article as a result of the manufacturing process. Accordingly, the Stealth 600X gaming headset is considered a product of Vietnam for origin and marking purposes.
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 Steven Pollichino at firstname.lastname@example.org.
Steven A. Mack
National Commodity Specialist Division