CLA-2-03:OT:RR:NC:N2:231
David C. Kelly, Esq.
Peterson Russell Kelly Livengood PLLC
10900 NE 4th Street
Bellevue, WA 98004
RE: The Country of Origin of Crabs
Dear Mr. Kelly:
In your letter dated August 9, 2022, you requested a country of origin determination on behalf of your client, Direct Source Seafood, LLC (Bellevue, WA).
You outlined a scenario by which crabs caught in pots in Russian Federation waters and/or by Russian Federation vessels are transported live to China for processing. The processing of the fresh live crabs consists of removing legs and shoulders from the bodies and discarding the bodies and shells. The remaining form of the crab consisting of legs connected at the shoulders is then cleaned, cooked, placed in boxes, frozen, and shipped in refrigerated containers to the United States for distribution and sale.
You seek a determination as to the proper country of origin of the above-described product for marking purposes.
The “country of origin” is defined in 19 C.F.R. 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 United States 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 C.C.P.A. 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. United States, 207 U.S. 556 (1908) and Uniroyal, Inc. v. United States, 3 C.I.T. 220, 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 will not have occurred. Uniroyal, Inc. v. United States, 3 C.I.T. 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, dated January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 C.I.T. 470, 478, 664 F. Supp. 535, 541 (1987).
In Koru North America v. United States, 701 F. Supp. 229 (C.I.T. 1988), the court considered whether the processing of headed and gutted fish in South Korea by thawing, skinning, boning, trimming, freezing, and packaging constituted a substantial transformation. The court concluded that the processing performed in South Korea into ‘quick-frozen’ fillets substantially transformed the headed fish because there was a change in name and character. Koru noted that while the item arrived in South Korea with the look of a whole fish, when the fish departed it no longer possessed the essential shape of a fish. The fillets were considered discrete commercial goods and had a different tariff classification.
Regarding the product at issue, you state that crabs are harvested in Russian Federation waters and/or by Russian Federation vessels and are transported live to a processor in China. The processing consists of removing legs and shoulders from the bodies and discarding the bodies and shells. The remaining form of the crab consisting of legs connected at the shoulders is then cleaned, cooked, placed in boxes, frozen, and shipped in refrigerated containers to the United States for distribution and sale.
For the product at issue, this office finds that the frozen crab product is not substantially transformed due to the processing performed in China. Accordingly, based on the information presented, the crabs are a product of Russia for CBP country of origin and marking purposes.
Please note that seafood is subject to the Mandatory Country of Origin Labeling (COOL) requirements administered by the USDA’s Agricultural Marketing Service (AMS). We advise you to check with that agency for their further guidance on your scenario. Contact information for AMS is as follows:
USDA-AMS-LS-SAT
Room 2607-S, Stop 0254
1400 Independence Avenue, SW
Washington, DC 20250-0254
Tel. 202.720.4486
Website: www.ams.usda.gov/COOL
Email address for inquiries: [email protected]
This merchandise is subject to The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act), which is regulated by the Food and Drug Administration (FDA). Information on the Bioterrorism Act can be obtained by calling the FDA at 301.575.0156, or at the Web site www.fda.gov/oc/bioterrorism/bioact.html.
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 Ekeng Manczuk at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division