MAR-2 OT:RR:NC:N1:424
Mike Choi
MKC Customs Broker Intl. Inc.
930 W. Hyde Park Blvd.
Inglewood, CA 90302
RE: The country of origin marking of bicycles assembled in Vietnam using foreign components
Dear Mr. Choi:
This is in response to your letter dated December 6, 2022, on behalf of Ballard Pacific Resources Inc., requesting a ruling on the country of origin of bicycles assembled in Vietnam using foreign components.
The model at issue is identified as the Genesis 26" dual suspension MTB bicycle, model number GN-2621-1. You stated that there are certain parts that are manufactured in China, which are then shipped to Vietnam where the fork, frame, and rims that are manufactured in Vietnam are added to complete the finished bicycle. In Vietnam, the manufacturing process includes cutting the tubes, bending, stamping, welding, and assembly.
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 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) (Uniroyal).
CBP has consistently found that the essence of a bicycle is its frame. For example, in HQ H302358, dated January 23, 2020, CBP determined that a bicycle manufactured in Taiw an with its frame sourced from China, and the remaining components sourced from Taiwan, China, Japan, and the United States, was a product of China. CBP stated that the frame was the most essential component of the bicycle as it imparts the overall shape, size, and character of the product. CBP further stated that the other parts of the bicycle lose their separate identity once they are attached to the frame and become a new article of commerce, the finished bicycle, with a new name, character, and use. See also New York Ruling Letter ("NY") N302992, dated March 27, 2019; NY N295820, dated May 3, 2018; NY N292674, dated December 26, 2017; HQ H253522, dated February 5, 2015; and HQ 735368, dated June 30, 1994 (determining that the frame is the essence, essential character, or most significant or essential component of a bicycle).
In the instant case, we also find that the essence of the Genesis, model number GN-2621-1 is its frame. The bicycle does not lose its essential character when the frame is assembled together with the other parts from China. The frame gives the bike is overall shape, size, and character. In view of these facts, we find that the frame sourced from Vietnam is the essence of the MTB, and the assembly operations of the various components in China does not result in a substantial transformation of the bicycle frames. Therefore, the country of origin of the Genesis model number GN-2621-1 is Vietnam.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 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 Roseanne Murphy at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division