[Federal Register Volume 86, Number 40 (Wednesday, March 3, 2021)]
[Notices]
[Pages 12487-12489]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-04334]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Notice of Issuance of Final Determination Concerning a 
Transceiver

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 transceiver, identified as the Barrett 4050 HF 
SDR Transceiver. Based upon the facts presented, CBP has concluded in 
the final determination that the transceiver, which is assembled in the 
United States of various imported components, including three 
Australian-origin printed circuit board assemblies, is not a product of 
a foreign country or instrumentality designated for purposes of U.S. 
Government procurement.

DATES: The final determination was issued on February 25, 2021. 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 April 2, 2021.

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

SUPPLEMENTARY INFORMATION: Notice is hereby given that on February 25, 
2021, CBP issued a final determination concerning the country of origin 
of the Barrett 4050 HF SDR Transceiver for purposes of Title III of the 
Trade Agreements Act of 1979. This final determination, HQ H314982, was 
issued at the request of Barrett Communications USA Corporation, 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, as a result of the assembly of various 
imported components, including three Australian-origin

[[Page 12488]]

printed circuit board assemblies, in the United States, the finished 
transceiver is not 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: February 25, 2021.
Joanne R. Stump,
Acting Executive Director, Regulations and Rulings, Office of Trade.

HQ H314982

February 25, 2021

OT:RR:CTF:VS H314982 CMR

CATEGORY: Origin

Jon P. Yormick, Esq. Flannery Georgalis LLC 1375 East Ninth Street 
One Cleveland Center, Floor 30 Cleveland, Ohio 44114

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 Transceiver

Dear Mr. Yormick:

    This is in response to your request of October 22, 2020, on 
behalf of your client, Barrett Communications USA Corporation, for a 
final determination concerning the country of origin of a device 
referred to as a Barrett 4050 HF SDR Transceiver pursuant to Title 
III of the Trade Agreements Act of 1979 (TAA), as amended (19 U.S.C. 
2511 et seq.). As the importer of merchandise entered into the 
United States and further processed in the United States, your 
client may request a final determination pursuant to 19 CFR 
177.23(a).

Facts

    The item at issue, the Barrett 4050 HF SDR Transceiver 
(hereinafter, ``transceiver''), is a software-defined based, single-
sideband (``SSB'') transceiver with a frequency range of 1.6 to 30 
MHz (transmit) and 250 kHz to 30 MHz (receive). You describe the 
transceiver as ``a commercial product that supports features such as 
Selective Call (Selcall), direct dial telephone connection to base 
stations fitted with telephone interconnect systems (Telcall), GPS 
location, 2G and 3G ALE (Automatic Link Establishment), frequency 
hopping, digital voice, data transmission and remote diagnostics.'' 
You indicate that the transceiver provides ``a comprehensive data 
modem interface port, high speed transmit-to-receive switching, a 
high stability frequency standard and an efficient cooling system 
option.''
    You indicate that the transceiver's control head ``features a 
GUI [graphical user interface] on a high definition 24-bit LCD color 
touchscreen.'' You state that ``[t]he [c]ontrol [h]ead can be 
detached from the main body of the [t]ransceiver for remote control. 
The [t]ransceiver can also be controlled remotely from most mobile 
and desktop platforms, including iOS, Android, and Windows 
devices.''
    You specify that there are three main assemblies for each 
transceiver--(1) the control head assembly; (2) the power amplifier 
(PA) assembly and chassis; and, (3) the microprocessor board and 
interface board assembly and chassis. Within these three main 
assemblies are five printed circuit board assemblies (PCBAs). The 
five PCBAs and the countries in which each PCBA is produced are as 
follows: the control head board (United States); the interface board 
(United States); the micro board (Australia); the PA board 
(Australia); and the volume control board (Australia). You indicate 
that prior to export to the United States, the only software 
installed on the boards produced in Australia is for the limited 
purpose of testing and diagnostics. The Australian produced boards 
are non-functional at the time of importation into the United 
States.
    In addition to the PCBAs described above, ``each transceiver 
includes, a radio chassis, a speaker, an LCD screen, looms, various 
molded plastic parts including dials and buttons, and various seals 
and fasteners.''
    The transceiver is assembled in the United States from imported 
and domestically produced components. You state the transceiver is 
assembled as a ``clamshell.'' You state:
    The Micro and Interface Boards are mounted on one half of the 
``clamshell;'' the PA Board is on the other half of the 
``clamshell.'' When the ``clamshell'' is assembled there are cables 
between the two (2) halves to allow signaling and RF to pass between 
them. An HD15 pin connector interface on one half of the 
``clamshell'' provides signaling to the Control Head. The Control 
Head has a color, touch screen display, volume knob, and buttons.
    The Control Head Board is mounted to the chassis of the Control 
Head, using screws and a loom. The loom takes the signaling from the 
screen and buttons to the Control Head Board, while another loom 
takes the signaling from the Control Head Board out to the 
interfacing HD connector. The Volume Control Board fits directly to 
the Control Head Board, as a daughter board.
    With regard to the functions of the boards, you state that the 
transceiver cannot function without the control head board. In 
addition, the interface board ``allows the [t]ransceiver to connect 
to antennae and auxiliaries such as modems and audio devices.'' 
Further, you indicate that the interface board enables the micro 
board to function. You state that the interface board allows the 
micro board ``to interface with all external items.''
    With regard to the control head, an integrated circuit (IC) and 
firmware programming process must be performed prior to assembly. 
After the IC is provided with its base programming, the control head 
is partially assembled and the control head board is loaded with 
base firmware programming. Once the programming is completed, the 
assembly of the control head (which entails cleaning and inspecting 
parts, installing the LCD screen and control head board, and 
assembling the remaining twenty-two control head components) is 
completed and the control head board is modified to function as part 
of the main assembly.
    After the transceiver is fully assembled, base operating 
firmware and software, which will control and enable functionality, 
is installed on the interface board and micro board. This software 
is developed by a combination of efforts. Source code is written for 
the transceiver by software developers in Australia. Technicians in 
the United States convert the source code into executable object 
code, load it onto the interface board and micro board and test the 
downloaded object code. Software for optional features, which is 
obtained from a foreign third-party, may also be installed if 
required according to a customer's purchase order specifications. 
Personnel in the U.S. ``install the software and firmware, which 
takes approximately forty-five (45) minutes, including programming 
the 2G ALE modem and the [t]ransceiver.''
    After the transceivers are assembled and programmed, they are 
tested. The software and the transceiver operation are tested. The 
testing occurs at the U.S. facility where the transceivers are 
assembled and programmed. Testing may also occur at customer sites 
within and outside the United States. After assembling, programming 
and testing, the transceivers are packed and shipped to customers 
located in the United States and throughout the Americas.

Issue

    Whether the transceivers at issue, which are assembled and 
programmed in the United States of domestic and foreign inputs, are 
eligible under Title III of the TAA, as amended (19 U.S.C. 2511-
2518), as products of a foreign country or instrumentality 
designated pursuant to section 2511(b).

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 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.

[[Page 12489]]

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 ``Free Trade Agreement country end product'' means an article 
that--
    (1) Is wholly the growth, product, or manufacture of a Free 
Trade Agreement (FTA) 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 an FTA 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.

``Free Trade Agreement country'' means Australia, Bahrain, Canada, 
Chile, Colombia, Costa Rica, Dominican Republic, El Salvador, 
Guatemala, Honduras, Korea (Republic of), Mexico, Morocco, 
Nicaragua, Oman, Panama, Peru, or Singapore. See 48 CFR 25.003. 
Thus, Australia is an FTA country for purposes of the Federal 
Acquisition Regulations.
    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.
    In this case, the transceiver contains five separate PCBAs. We 
are told that three of these are produced by the assembly of the 
various components onto the PCB in Australia, and two are similarly 
produced in the United States. CBP has consistently held that the 
assembly of various components onto a blank printed circuit board to 
produce a PCBA is a substantial transformation. See Headquarters 
Ruling Letter (HQ) H311447, dated September 10, 2020, citing HQ 
735306, dated December 21, 1993 (``. . . Customs has ruled that the 
complete assembly of all the components onto a printed circuit board 
was a substantial transformation of the printed circuit board . . . 
''), and HQ H302801, dated October 3, 2019 (``The SMT [surface-mount 
technology] operations result in a new and different product with an 
overall use and function different than any one function of the 
individual components.''). In this case, the three Australian-
produced PCBAs and numerous other components from various countries 
are imported into the United States for assembly into the finished 
transceiver. The PCBAs for the control head board and the interface 
board, PCBAs which CBP considers to be dominant as they are within 
components which are essential to the functioning of the 
transceiver, are assembled in the United States. You state that the 
transceiver cannot function without the control head board. Further, 
the interface board allows the transceiver to connect to antennae 
and items such as, modems and audio devices. The interface board 
enables the micro board to function and interface with external 
items.
    We note the production includes the assembly in the United 
States of the dominant PBCAs related to the transceiver's function, 
along with the assembly of all the remaining components of the 
transceiver to produce the finished good. While CBP does not 
recognize downloading of firmware or software to constitute a 
substantial transformation, we note that the conversion of the 
Australian software into executable code, which occurs in the United 
States, and programming of the transceiver boards is additional work 
to be considered in assessing the proper origin of the finished 
transceiver. See HQ H306349, dated November 26, 2019, (``. . . CBP 
has consistently held that the downloading of software or firmware 
is not a substantial transformation.'').
    Noting that CBP is limited by the language of 19 U.S.C. 
2515(b)(1) to a determination of whether a good is a product of a 
foreign country or instrumentality designated pursuant to section 
2511(b) of this title, based upon the information presented, the 
transceiver is not a product of Australia or any other foreign 
country or instrumentality designated pursuant to section 2511(b) of 
Title 19. As to whether the transceiver which is assembled in the 
United States qualifies as a ``U.S.-made end product,'' we encourage 
you to review the recent court decision in Acetris Health, LLC v. 
United States, 949 F.3d 719 (Fed. Cir. 2020), and to consult with 
the relevant government procuring agency.

Holding

    The transceiver at issue, the Barrett 4050 HF SDR Transceiver, 
is not a product of Australia or any other foreign country or 
instrumentality designated pursuant to section 2511(b) of Title 19.
    You should consult with the relevant government procuring agency 
to determine whether the transceiver qualifies as a ``U.S.-made end 
product'' for purposes of the Federal Acquisition Regulations 
implementing the TAA.
    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,

Joanne R. Stump

Acting Executive Director Regulations and Rulings Office of Trade

[FR Doc. 2021-04334 Filed 3-2-21; 8:45 am]
BILLING CODE 9111-14-P