[Federal Register Volume 85, Number 240 (Monday, December 14, 2020)]
[Notices]
[Pages 80798-80799]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-26342]



[[Page 80798]]

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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Notice of Issuance of Final Determination Concerning a Whoop 
Strap Device

AGENCY: U.S. Customs and Border Protection, Department of Homeland 
Security.

ACTION: Notice of final determination.

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SUMMARY: This document provides notice that U.S. Customs and Border 
Protection (CBP) has issued a final determination concerning the 
country of origin of a device referred to as a Whoop Strap. Based upon 
the facts presented, CBP has concluded in the final determination that 
the incomplete Whoop Strap and the programming in the United States 
would not render the Whoop Strap device to be a product of a foreign 
country or instrumentality designated for purposes of U.S. Government 
procurement.

DATES: The final determination was issued on November 10, 2020. A copy 
of the final determination is attached. Any party-at-interest, as 
defined in 19 CFR 177.22(d), may seek judicial review of this final 
determination within January 13, 2021.

FOR FURTHER INFORMATION CONTACT: Cynthia Reese, Valuation and Special 
Programs Branch, Regulations and Rulings, Office of Trade, at (202) 
325-0046.

SUPPLEMENTARY INFORMATION: Notice is hereby given that on November 10, 
2020, U.S. Customs and Border Protection (CBP) issued a final 
determination concerning the country of origin of a Whoop Strap device 
for purposes of Title III of the Trade Agreements Act of 1979. This 
final determination, HQ H309761, was issued at the request of Whoop 
Inc., under procedures set forth at 19 CFR part 177, subpart B, which 
implements Title III of the Trade Agreements Act of 1979, as amended 
(19 U.S.C. 2511-18). In the final determination, CBP has concluded 
that, based upon the facts presented, the incomplete imported Whoop 
Strap and the programming in the United States would not render the 
finished Whoop Strap to be a product of a foreign country or 
instrumentality designated pursuant to 19 U.S.C. 2511(b) for purposes 
of U.S. Government procurement.
    Section 177.29, CBP Regulations (19 CFR 177.29), provides that 
notice of final determinations shall be published in the Federal 
Register within 60 days of the date the final determination is issued. 
Section 177.30, CBP Regulations (19 CFR 177.30), provides that any 
party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial 
review of a final determination within 30 days of publication of such 
determination in the Federal Register.

    Dated: November 24, 2020.
Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.

HQ H309761

November 10, 2020

OT:RR:CTF:VS H309761 CMR

Category: Origin
Steven B. Zisser, Esq.
Zisser Group
9355 Airway Road
Suite 1
San Diego, CA 92154
RE: U.S. Government Procurement; Title III, Trade Agreements Act of 
1979 (19 U.S.C. 2511); subpart B, Part 177, CBP Regulations; Country of 
Origin of a Whoop Strap Device
Dear Mr. Zisser:
    This is in response to your request of February 27, 2020, on behalf 
of your client, Whoop, Inc., for a final determination concerning the 
country of origin of a device referred to as a ``Whoop Strap.'' This 
request is being sought because your client wants to confirm 
eligibility of the device for U.S. government procurement purposes 
under Title III of the Trade Agreements Act of 1979 (TAA), as amended 
(19 U.S.C. 2511 et seq.). As an importer of the merchandise imported 
from China that is processed in the United States to become a finished 
``Whoop Strap,'' your client may request a final determination pursuant 
to 19 CFR 177.23(a).

Facts:

    You describe the ``Whoop Strap'' as:

. . . a fitness performance tracker that combines a wrist-worn 
device with a cloud-based analytics system. It incorporates a sensor 
that generates data that is to be processed through the analytics 
system to provide information relating to the fitness of the 
individual wearing the wrist-worn device.

    You indicate ``[t]he products consists of hardware, a sensor, 
printed circuit board assembly (PCBA) incorporating a radio module, and 
battery which [are] encased in a polycarbonate housing with clasp and 
attached to a fabric wristband.'' A memory device on the PCBA is 
adapted to receive and store proprietary software which is developed by 
Whoop. The software records and communicates the fitness data and 
generates the analytics.
    The manufacturing of the hardware of the Whoop Strap occurs in 
China where the sensor, PCBA, battery and housing are assembled. You 
also indicate that there is a cover that is placed over the case/kit. 
You state:
    All hardware components are ``designed'' in the USA and produced 
and assembled in China. In the USA, the hardware is attached to the 
fabric waistband with a clasp.

    After assembly in China and before exportation to the United 
States, the Whoop Strap is tested to confirm the assembly was properly 
done. You refer to the test as a ``power on'' test which requires 
minimal software and equipment. You indicate that the testing software 
is removed prior to shipment to the United States and ``[a] `simple' 
firmware updater is loaded on the device in China [that] will allow 
further software to be loaded in the USA.'' At the time of shipment 
from China, you indicate that the Whoop Strap does not function.
    After importation into the United States, ``Whoop programs the 
proprietary communications software, file software, and battery pack 
communications firmware.'' You state that ``[t]his process is achieved 
by writing, testing and implementing the necessary code to make the 
product function as intended.'' The software and firmware codes are 
developed and written in the United States by Whoop employees. Once 
programmed in the United States, the device functions as intended, 
i.e., being able to sense and communicate health data to the user. The 
programming of the device in the United States greatly increases its 
value.

Issue:

    Whether the Whoop Strap, which is assembled in China and programmed 
with software and firmware in the United States, is eligible under the 
Title III of the TAA, as amended (19 U.S.C. 2511-2518).

Law and analysis:

    U.S. Customs and Border Protection (CBP) issues country of origin 
advisory rulings and final determinations as to whether an article is 
or would be a product of a designated country or instrumentality for 
the purpose of granting waivers of certain ``Buy American'' 
restrictions in U.S. law or practice for products offered for sale to 
the U.S. Government, pursuant to subpart B of Part 177, 19 CFR 177.21 
et seq., which implements Title III, Trade Agreements Act of 1979, as 
amended (19 U.S.C. 2511-2518).
    The rule of origin set forth in 19 U.S.C. 2518(4)(B) states:

    An article is a product of a country or instrumentality only if 
(i) it is wholly the growth, product, or manufacture of that country 
or instrumentality, or (ii) in the case

[[Page 80799]]

of an article which consists in whole or in part of materials from 
another country or instrumentality, it has been substantially 
transformed into a new and different article of commerce with a 
name, character, or use distinct from that of the article or 
articles from which it was so transformed.

    See also 19 CFR 177.22(a).
    In rendering advisory rulings and final determinations for purposes 
of U.S. Government procurement, CBP applies the provisions of subpart B 
of Part 177 consistent with the Federal Procurement Regulations. See 19 
CFR 177.21. In this regard, CBP recognizes that the Federal Acquisition 
Regulations restrict the U.S. Government's purchase of products to 
U.S.-made or designated country end products for acquisitions subject 
to the TAA. See 48 CFR 25.403(c)(1). The Federal Acquisition 
Regulations define ``U.S.-made end product'' as:

    . . . an article that is mined, produced, or manufactured in the 
United States or that is substantially transformed in the United 
States into a new and different article of commerce with a name, 
character, or use distinct from that of the article or articles from 
which it was transformed.

    The regulations define a ``designated country end product'' as:

    WTO GPA [World Trade Organization Government Procurement 
Agreement] country end product, an FTA [Free Trade Agreement] 
country end product, a least developed country end product, or a 
Caribbean Basin country end product.

    A ``WTO GPA country end product'' is defined as an article that:

    (1) Is wholly the growth, product, or manufacture of a WTO GPA 
country; or
    (2) In the case of an article that consists in whole or in part 
of materials from another country, has been substantially 
transformed in a WTO GPA country into a new and different article of 
commerce with a name, character, or use distinct from that of the 
article or articles from which it was transformed. The term refers 
to a product offered for purchase under a supply contract, but for 
purposes of calculating the value of the end product includes 
services (except transportation services) incidental to the article, 
provided that the value of those incidental services does not exceed 
that of the article itself.

See 48 CFR 25.003.

    China is not a WTO GPA country.
    The article imported into the United States is the Whoop Strap 
assembled hardware consisting of a sensor, PCBA, battery and housing 
with a cover placed over the case/kit. The article, in its condition as 
imported, is incomplete and non-functional as it lacks the software and 
firmware necessary for it to function. The incomplete Whoop Strap, at 
the time of importation, is a product of China. CBP is of the view that 
programming would not result in a substantial transformation. This is 
consistent with CBP's prior determination in H284523 dated August 22, 
2017, where CBP held that an imported tablet did not undergo a 
substantial transformation by programming. See also H284617 dated 
February 21, 2018.
    CBP's authority to issue advisory rulings and final determinations 
is set forth in 19 U.S.C. 2515(b)(1), which states:

    For the purposes of this subchapter, the Secretary of the 
Treasury shall provide for the prompt issuance of advisory rulings 
and final determinations on whether, under section 2518(4)(B) of 
this title, an article is or would be a product of a foreign country 
or instrumentality designated pursuant to section 2511(b) of this 
title.

Emphasis added.

    Therefore, the Whoop Strap would not be considered to be the 
product of a foreign country or instrumentality designated pursuant to 
19 U.S.C. 2511(b). As to whether the Whoop Strap processed in the 
United States may be considered a ``U.S.-made end product'' is under 
the jurisdiction of the procuring agency. See Acetris Health, LLC. v. 
United States, No. 2018-2399 (Fed. Cir. February 10, 2020).

Holding:

    The incomplete Whoop Strap and the programming in the United States 
would not render it to be a product of a foreign country or 
instrumentality designated pursuant to 19 U.S.C. 2511(b). You may wish 
to check the classification of this product to determine if it may be 
subject to any Section 301 duties upon importation.
    Notice of this final determination will be given in the Federal 
Register, as required by 19 CFR 177.29. Any party-at-interest other 
than the party which requested this final determination may request, 
pursuant to 19 CFR 177.31, that CBP reexamine the matter anew and issue 
a new final determination. Pursuant to 19 CFR 177.30, any party-at-
interest may, within 30 days of publication of the Federal Register 
Notice referenced above, seek judicial review of this final 
determination before the Court of International Trade.

Sincerely,

Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.

[FR Doc. 2020-26342 Filed 12-11-20; 8:45 am]
BILLING CODE 9111-14-P