CLA-2-38:OT:RR:NC:N3:135
Ms. Lisa Murrin
Expeditors Tradewin
795 Jubilee Drive
Peabody, MA 01960
RE: The country of origin of COVID-19 Diagnostic Nasal Swab Kits
Dear Ms. Murrin:
In your letter dated August 25, 2021, you requested a country of origin ruling for COVID-19 Diagnostic Nasal Swab Kits on behalf of Detect, Inc.
The test kit is a molecular in vitro diagnostic test that uses isothermal amplification and lateral flow technologies for the detection of RNA of the SARS-CoV-2 in nasal swab specimens collected from individuals. It consists of a nasal swab, a warming test tube, a test cap, a dropper, and a readout device. The test cap contains a reagent bead carrying a proprietary mix of enzymes, nucleotides, and primers, which enables the isothermal amplification for both COVID (target) and RNaseP (control) detection. The dropper is a buffer solution in a plastic holder, designed to provide a fixed amount of buffer solution to pre-wet the lateral flow strip in the readout device prior to a sample insertion.
In use, when a nasal test sample (specimens) is mixed with the dissolved reagent bead in the warming test tube and the tube is placed into a reusable warmer device (not included in the kit), isothermal amplification occurs at an elevated temperature, which will amplify nucleic acids exponentially. After amplification, the warming test tube is inserted into the readout device and the tube’s liquid wicks onto the lateral flow strip. On the lateral flow strip’s sample pad, SARS-CoV-2 and control amplicons bind colored particles and flow through the lateral flow strip’s membrane, where they are captured by immobilized antibodies at distinct lines on the strip. If these viral molecules are present in the nasal test sample, the lateral flow strip in the readout device displays via a pattern of bands whether the person tested positive or negative for coronavirus.
The nasal swab is a product of Taiwan. The warmer test tube can be a product of the United States or Taiwan. The test cap is a product of the United States. The dropper is a product of the United States or United Kingdom. The readout device will be assembled in Taiwan from multiple-country components. The readout assembly process in Taiwan requires die-cutting the lateral flow strip, clamping the bottom piece, top piece, and blade, combining the components, and welding them together. This assembly process, including quality control, project management and shift leads, takes 15.75 seconds. The nasal swab, warming test tube, test cap, dropper, and readout device will be packaged together in Taiwan as a kit and imported into the United States. You provide four production scenarios.
Scenario 1: The lateral flow strip with U.S.-origin antibodies is made in the United States. The manufacturing process for the lateral flow strip is described as follows:
The paper is prepared, in a batch system, with the U.S.-origin antibodies. The prepared strips are then laminated onto a backing card. Nitrocellulose strips are printed with 3 lines across, 300mm in length, dried for an hour at 37C, and kept in a dry cabinet. Conjugate is sprayed onto the glass fiber pad (called the conjugate pad) and cooked and stored the same way as nitrocellulose strips. The wick pad is added during lamination. The resulting card is 300mm by 60mm and it is then cut into 5mm strips to produce the final lateral flow strip subassembly. The application of the U.S.-origin antibodies to the lateral flow strips does not change the functionality of the antibodies.
Scenario 2:
The only differences between Scenario 1 and Scenario 2 are that: (1) the lateral flow strip will be prepared in Taiwan with U.S.-origin antibodies; (2) the warmer test tube will be manufactured in Taiwan; and (3) the buffer solution in the dropper will be produced in the United States.
Scenario 3:
Scenario 3 is identical to Scenario 1 except that the antibodies used in the preparation of the lateral flow strip in the United States are of Switzerland-origin.
Scenario 4:
Scenario 4 is identical to Scenario 2 except that the antibodies used in the preparation of the lateral flow strip in Taiwan are of Switzerland-origin.
COUNTRY OF ORIGIN
"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.”
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 and makes such determinations on a case-by-case basis. 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. Assembly operations that are minimal or simple, as opposed to complex or meaningful, will generally not result in a substantial transformation. See C.S.D. 80-111, C.S.D. 85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D. 90-51, and C.S.D. 90-97.
The Court of International Trade has also looked at the essence of an article to determine whether its identity has been substantially transformed through assembly or processing. For example, in Uniroyal, Inc. v. United States, 3 CIT 220, 225, 542 F. Supp. 1026, 1030 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983), the court held that imported shoe uppers added to an outer sole in the United States were the “very essence of the finished shoe” and thus the character of the product remained unchanged and did not undergo substantial transformation in the United States. Similarly, in National Juice Products Association v. United States, 10 CIT 48, 61, 628 F. Supp. 978, 991 (1986), the court held that imported orange juice concentrate “imparts the essential character” to the completed orange juice and thus was not substantially transformed into a product of the United States.
In Headquarter ruling 560613, dated Oct. 28, 1997, Customs and Border Protection (“CBP”) ruled on the country of origin of a pregnancy test kit consisting of a plastic housing that held a cellulose strip which was connected to a media that was impregnated with certain antibodies. Three U.S.-origin antibodies were shipped to Ireland in liquid form. Two of them were sprayed onto the nitrocellulose in two thin lines and dried. The third one with a solution was dried onto the rayon membrane. The nitrocellulose and rayon were then placed on a laminated paper with the 901 and 939 paper which had been soaked in a detergent solution and dried. These laminates were then cut into 6.9 mm strips. The strips were then assembled into the housing which consists of a top part, a bottom part, and a cap. CBP concluded that the placement of U.S.-origin antibodies on solid material and the simple assembly of components did not result in a substantial transformation in Ireland.
In NY ruling N025454, dated Apr. 22, 2008, CBP ruled on another country of origin of a pregnancy test kit composed of a digital optical reader and plastic housing that held a strip of nitrocellulose membrane that was impregnated with the antibodies. UK-origin antibodies were shipped to China where they were applied to the nitrocellulose membrane and made into strips. The strips, digital reader and plastic housing were manufactured in China and hand assembled together. CBP determined that the antibodies were not transformed enough or at all during the assembly process in China to render them products of China.
In this case, the assembly process performed for the readout device and the manufacturing process for the lateral flow strip are very similar to the previous rulings. They are relatively simple. Accordingly, the placing of the antibodies on the nitrocellulose strip and the subsequent assembly of the strip into the plastic housing does not constitute a substantial transformation. The antibodies are not transformed into a new article with a new name or a new use and did not lose their identity. The antibodies are the critical component, which detects the presence of COVID RNA, of the readout device. As such, the country of origin of the readout device will depend on the country of origin of the antibodies, which are either the United States or Switzerland. In addition, you state the buffer solution in the dropper will be produced in the United States or United Kingdom. The plastic holder of the buffer solution is a carrier of the buffer solution. The country of origin of the dropper will be determined by the country of the buffer solution.
Regarding the country of origin of the kit in all four scenarios, mere packaging of the nasal swab, warming test tube, test cap, dropper, and readout device together in Taiwan as a kit does not substantially transform any of the components. Accordingly, the nasal swab, warming tube, test cap, dropper, and readout device are not substantially transformed in Taiwan as they do not emerge with a new name, character, and use. Thus, each component retains its original country of origin. In scenario 1, the country of origin of the kit will be Taiwan, United States, and United Kingdom. In scenario 2, the country of origin of the kit will be Taiwan and United States. In scenario 3, the country of origin of the kit will be Taiwan, United States, United Kingdom, and Switzerland. In scenario 4, the country of origin of the kit will be Taiwan, United States, and Switzerland. The country of origin of the individual items in the COVID-19 Diagnostic Nasal Swab Kit must be indicated to satisfy the country of origin marking law of 19 U.S.C. §1304.
Goods determined to be an article of U.S. origin are not subject to the country of origin marking requirements of 19 U.S.C. §1304. Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). Consequently, any inquiries regarding the use of such phrases reflecting U.S. origin should be directed to the FTC, at the following address: Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580.
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 Fei Chen at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division