MAR-2 OT:RR:NC:N1:424
Mr. Angel Torres
Pure Fishing, Inc.
7 Science Court
Columbia, SC 29203
RE: The country of origin and marking of fishing rods and fishing reels assembled in China using reels made in Korea with rods made in China
Dear Mr. Torres:
In your letter dated February 28, 2020, you requested a ruling on the country of origin, acceptable marking and the application of Section 301 duties for certain fishing rod and reel “Combo” sets.
The merchandise at issue, referred to as a “Combo” set, consists of a fishing rod and fishing reel that is assembled together and packaged for retail sale. According to your submission, all fishing reels are manufactured in Korea and are then shipped to China to be assembled with fishing rods of Chinese origin and packaged for retail sale. You state that there are several possible combinations of rods and reels to be imported. As detailed in your email response, dated March 12, 2020, the various “Combo” sets will incorporate basic types of fishing reels including spinning, spincast, bait casting and fly reels. The reels are manufactured in Korea and may be constructed of materials ranging from plastic, aluminum, stainless steel, zinc, magnesium and brass. The heights, length and weight of each product will vary by reel type and size. It was further stated that the fishing rods, which are produced in China, are composed of fiberglass or graphite with guides made of stainless steel, titanium and ceramic. Reel seats and handles are made of aluminum, plastic, EVA foam or cork.
As an initial matter, we note the products which are sold and marketed as “Combo” sets will be considered composite goods for the purposes of the tariff. No one heading in the tariff schedule covers these components in combination, therefore, in accordance with the General Rules of Interpretation (GRI), GRI 1 cannot be used as a basis of classification. GRI 3 provides for goods that are, prima facie, classifiable in two or more headings. GRI 3(b) provides that mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale shall be classified as if they consisted of the material or component which gives them their essential character. GRI 3(c) provides that when goods cannot be classified by reference to GRI 3(b), they are classified in the heading/subheading of the tariff that occurs last in numerical order among those that equally merit consideration.
Noting GRI 3(c), the heading/subheading that occurs last in numerical order among those that merit equal consideration will determine the classification of the article. The heading/subheading for the fishing reels occur last in numerical order in the Harmonized Tariff Schedule of the United States (HTSUS) among those that equally merit consideration. Therefore, the applicable subheading for the fishing “Combo” set would be 9507.30…, (HTSUS), which provides for fishing reels and parts and accessories. As classification of each “Combo” set is contingent on the value of the reel, and you did not supply us with the value breakdown of the assorted “Combo” sets that will be imported, we cannot rule on classification of the individual variations.
With regard to your request for the appropriate country of origin of the aforementioned “Combo” sets, 19 C.F.R. § 134.1(b) provides in pertinent part as follows:
Country of origin means 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.” A substantial transformation occurs when articles lose their identity and become articles having a new name, character, or use.
The courts have long 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. A substantial transformation will not result from a minor manufacturing or combining process that leaves the identity of the article intact. U.S. v. Gibson-Thomsen CO., 27 C.C.P.A. 267 (1940).
In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, CBP considers the totality of the circumstances. The country of origin of the item’s components, extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, and use, are primary considerations in such cases. It is the opinion of this office that the addition of the fishing rod and the simple assembly process in China would not be considered a substantial transformation. Therefore, the country of origin of the reel and rod “Combo” set would be Korea and would not be subject to the 301 Trade Remedy.
With regard to acceptable country of origin marking, 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 United States, the English name of the country of origin of the article.
Your proposed marking of the retail packaging, “Reels Made in Korea, Rods Made in China” in like font of equal size is acceptable.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177).
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 19 CFR 177.9(b)(1). In the event that the facts or merchandise are modified in any way, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and you should resubmit for a new ruling in accordance with 19 CFR 177.2.
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