OT:RR:NC:N:N1:105
Matthew Bock
Middleton Shrull & Bock
100 Sylvan Road, Suite 660
Woburn, Massachusetts 01801
RE: The country of origin of the Gardyn Indoor Vertical Hydroponic System
Dear Mr. Bock:
In your letter dated May 19, 2021, on behalf of your client, Gardyn, Inc., you requested a country of origin ruling determination on the Gardyn Indoor Vertical Hydroponic System.
The merchandise under consideration is described as the Gardyn Indoor Vertical Hydroponic System. The system has three plastic columns into which seed pods can be inserted, and a base that houses a six-gallon water reservoir and pump. Two poles protruding from the base incorporate LED light strips that generate simulated sunlight and a computer module known as the Raspberry Pi Zero W (“Raspberry Pi”), which is the controller for the kit. The Raspberry Pi leverages various built-in sensors (temperature and water level) and cameras to monitor the growth of the plants and compute how light and water need to be adjusted to optimize their growth. The Raspberry Pi also has the ability to connect to the internet to ensure remote monitoring and control from the Gardyn Mobile Application.
In your request, you state the Raspberry Pi Zero W is sourced from Japan and is connected to a printed circuit board assembly (PCBA), which interfaces with the various peripherals. You also state that the Raspberry Pi Zero W is the most expensive single component other than the Chinese power supply. Additional Chinese manufactured components include the cameras, connection board, LED strips, stickers and cardboard for packaging, the water level sensor, lighting holding structures, irrigation system including the pump, wood board, wires, switches and blades, temperature sensor, screws, adapters, and miscellaneous lid parts. Taiwanese sourced components include the three columns, plastic lid, SD card, and the tank. In China, the Japanese Raspberry Pi is combined (plugged in and screwed) with the Taiwanese and Chinese components to make the complete Gardyn Indoor Vertical Hydroponic System. Once all of the components are obtained, most of the assembly procedures involve screwing the various components in place. The completed article will then be hooked up to a laptop by the operator for testing. Finally, the complete article is packaged for shipment to the United States.
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 our view, although the Raspberry Pi is an essential component which controls the Gardyn Indoor Vertical Hydroponic System, the device would not be able to function without the lights, sensors, and irrigation system. We believe that the addition of the Taiwanese and Chinese components, which also make up 90% of the cost of the materials, are essential to the systems operation and therefore create a substantial transformation in China. Furthermore, the Raspberry Pi is only one piece of the finished product, albeit an important one, but does have its name, character, and use substantially transformed into a device with the ability to spray water, sense water levels, sense temperature, and replicate sunlight. The Raspberry Pi itself does not carry out these functions as it is responsible for processes concerning leveraging, connecting, and computing. Therefore, it is our opinion that a substantial transformation occurs with the assembly process being performed in China and the Gardyn Indoor Vertical Hydroponic System is a product of China for origin and marking purposes at the time of importation into the United States.
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 Jason Christie at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division