1222 Federal Register / Vol. 78, No. 5 / Tuesday, January 8, 2013 / Notices 

CATEGORY: Origin 

Ms. Susan Todd 

Senior Manager, Regulatory Affairs 

West-Ward Pharmaceutical Corp. 

435 Industrial Way West 

Eatontown, NJ 07724 

RE: Government Procurement; Trade 

Agreements Act; Country of Origin of 

Ponstel® (mefenamic acid) Capsules; 

Substantial Transformation 

Dear Ms. Todd: 

This is in response to your letter, dated 

August 21, 2012, requesting a final 

determination on behalf of West-Ward 

Pharmaceutical Corp. (‘‘West-Ward’’) 

pursuant to subpart B of part 177 of the U.S. 

Customs and Border Protection (‘‘CBP’’) 

Regulations (19 C.F.R. Part 177). Under these 

regulations, which implement Title III of the 

Trade Agreements Act of 1979 (‘‘TAA’’), as 

amended (19 U.S.C. § 2511 et seq.), 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 purposes 

of granting waivers of certain ‘‘Buy 

American’’ restrictions in U.S. law or 

practice for products offered for sale to the 

U.S. Government. 

This final determination concerns the 

country of origin of Ponstel (mefenamic acid) 

capsules. As a U.S. importer, West-Ward is 

a party-at-interest within the meaning of 19 

C.F.R. § 177.22(d)(1) and is entitled to request 

this final determination. 

FACTS: 

West-Ward imports mefenamic acid 

powder in bulk form from India, where it is 

manufactured. Mefenamic acid is the active 

pharmaceutical ingredient (‘‘API’’) in the 

pharmaceutical product Ponstel. Ponstel is 

indicated for the relief of mild to moderate 

pain caused by primary dysmenorrhea and is 

approved by the U.S. Food and Drug 

Administration, NDA no. 015034. 

After importation, West-Ward combines 

the API, mefenamic acid, with inactive 

ingredients and processes it into dosage form. 

The inactive ingredients are lactose 

monohydrate, D&C Yellow No. 10, FD&C 

Yellow No. 6, gelatin, titanium dioxide, and 

food-grade inks. The mefenamic acid is 

added to a tumbler and blended. Lactose 

monohydrate, a diluent, is then added to the 

tumbler and blended with the API. The blend 

is transferred to an encapsulating machine 

and used to fill capsules purchased from a 

U.S. supplier. The capsules are packed into 

bottles of 30 capsules each, which are 

packaged and shipped to the U.S.-holder of 

the New Drug Application for Ponstel. 

ISSUE: 

What is the country of origin of Ponstel 

(mefenamic acid) capsules for purposes of 

U.S. Government procurement? 

LAW AND ANALYSIS: 

Pursuant to Subpart B of Part 177, 19 CFR 

§ 177.21 et seq., which implements Title III 

of the Trade Agreements Act of 1979, as 

amended (19 U.S.C. § 2511 et seq.), 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 purposes 

of granting waivers of certain ‘‘Buy 

American’’ restrictions in U.S. law or 

practice for products offered for sale to the 

U.S. Government. 

Under the rule of origin set forth under 19 

U.S.C. § 2518(4)(B): 

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 C.F.R. § 177.22(a). 

A substantial transformation occurs when 

an article emerges from a process with a new 

name, character and use different from that 

possessed by the article prior to processing. 

A substantial transformation will not result 

from a minor manufacturing or combining 

process that leaves the identity of the article 

intact. See United States v. Gibson-Thomsen 

Co., 27 C.C.P.A. 267 (1940); and, National 

Juice Products Association v. United States, 

628 F. Supp. 978 (Ct. Int’l Trade 1986). 

In determining whether a substantial 

transformation occurs in the manufacture of 

chemical products such as pharmaceuticals, 

CBP has consistently examined the 

complexity of the processing and whether the 

final article retains the essential identity and 

character of the raw material. To that end, 

CBP has generally held that the processing of 

pharmaceutical products from bulk form into 

measured doses does not result in a 

substantial transformation of the product. See 

e.g., Headquarters Ruling Letter (‘‘HQ’’) 

561975, dated April 3, 2002; HQ 561544, 

dated May 1, 2000; and, HQ 735146, dated 

November 15, 1993. 

For instance, in HQ 561975, the anesthetic 

drug sevoflurane imported into the U.S. in 

bulk form and processed into dosage form by 

extensive testing operations, followed by 

filtering and packaging into bottles, was 

found not to have undergone a substantial 

transformation in the U.S. There was no 

change in name (the product was identified 

as sevoflurane in both its bulk and processed 

form). The sevoflurane retained its chemical 

and physical properties after the U.S. 

processing. Lastly, because the imported bulk 

sevoflurane had a predetermined medicinal 

use as an inhalable anesthetic drug, the 

processing in the United States resulted in no 

change in the product’s use. 

Likewise, in HQ 561544, the testing, 

filtering and sterile packaging of Geneticin 

Sulfate bulk powder, to create Geneticin 

Selective Antibiotic, was not found to have 

substantially transformed the antibiotic 

substance because the processing only 

involved the removal of impurities from the 

bulk chemical and the placement of the 

chemical into smaller packaging. 

In HQ 735146, 100 percent pure 

acetaminophen imported from China was 

blended with excipients in the United States, 

granulated and sold to pharmaceutical 

companies to process into tablets for retail 

sale under private labels. U.S. Customs (now 

CBP) found that the process in the United 

States did not substantially transform the 

imported product because the product was 

referred to as acetaminophen both before 

importation and after U.S. processing, as 

imported the acetaminophen was used for 

medicinal purposes and continued to be so 

used after U.S. processing, and the 

granulating process minimally affected the 

chemical and physical properties of the 

acetaminophen. 

In this case, the mefenamic acid imported 

from India is blended with excipients and 

packaged into dosage form in the United 

States. Based on the rulings above, we find 

that this process does not substantially 

transform the mefenamic acid because its 

chemical character remains the same. As 

such, we find that the country of origin of the 

Ponstel (mefenamic acid) capsules is India, 

where the mefanamic acid was 

manufactured. 

HOLDING: 

Based on the facts in this case, the 

blending and packaging operations 

performed in the United States do not 

substantially transform the mefenamic acid 

imported from India. Therefore, the country 

of origin of the Ponstel® (mefenamic acid) 

capsules is India for purposes of U.S. 

Government procurement. 

Notice of this final determination will be 

given in the Federal Register, as required by 

19 C.F.R. § 177.29. Any party-at-interest other 

than the party which requested this final 

determination may request, pursuant to 19 

C.F.R. § 177.31, that CBP reexamine the 

matter anew and issue a new final 

determination. Pursuant to 19 C.F.R. 

§ 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, 

Jeremy Baskin, 

Acting Executive Director, Regulations and 

Rulings, Office of International Trade. 

[FR Doc. 2013–00140 Filed 1–7–13; 8:45 am] 

BILLING CODE;P 

DEPARTMENT OF HOMELAND 

SECURITY 

U.S. Customs and Border Protection 

Quarterly IRS Interest Rates Used in 

Calculating Interest on Overdue 

Accounts and Refunds on Customs 

Duties 

AGENCY: U.S. Customs and Border 

Protection, Department of Homeland 

Security. 

ACTION: General notice. 

SUMMARY: This notice advises the public 

of the quarterly Internal Revenue 

Service interest rates used to calculate 

interest on overdue accounts 

(underpayments) and refunds 

(overpayments) of customs duties. For 

the calendar quarter beginning January 

1, 2013, the interest rates for 


srobinson on DSK4SPTVN1PROD with 
Federal Register / Vol. 78, No. 5 / Tuesday, January 8, 2013 / Notices 1223 

overpayments will be 2 percent for 

corporations and 3 percent for noncorporations, and the interest rate for 

underpayments will be 3 percent for 

both corporations and non-corporations. 

This notice is published for the 

convenience of the importing public 

and U.S. Customs and Border Protection 

personnel. 

DATES: Effective Date: January 1, 2013. 

FOR FURTHER INFORMATION CONTACT: Ron 

Wyman, Revenue Division, Collection 

and Refunds Branch, 6650 Telecom 

Drive, Suite #100, Indianapolis, Indiana 

46278; telephone (317) 614–4516. 

SUPPLEMENTARY INFORMATION: 

Background 

Pursuant to 19 U.S.C. 1505 and 

Treasury Decision 85–93, published in 

the Federal Register on May 29, 1985 

(50 FR 21832), the interest rate paid on 

applicable overpayments or 

underpayments of customs duties must 

be in accordance with the Internal 

Revenue Code rate established under 26 

U.S.C. 6621 and 6622. Section 6621 was 

amended (at paragraph (a)(1)(B) by the 

Internal Revenue Service Restructuring 

and Reform Act of 1998, Public Law 

105–206, 112 Stat. 685) to provide 

different interest rates applicable to 

overpayments: one for corporations and 

one for non-corporations. 

The interest rates are based on the 

Federal short-term rate and determined 

by the Internal Revenue Service (IRS) on 

behalf of the Secretary of the Treasury 

on a quarterly basis. The rates effective 

for a quarter are determined during the 

first-month period of the previous 

quarter. 

In Revenue Ruling 2012–32, the IRS 

determined the rates of interest for the 

calendar quarter beginning January 1, 

2013, and ending on March 31, 2013. 

The interest rate paid to the Treasury for 

underpayments will be the Federal 

short-term rate (1%) plus two 

percentage points (2%) for a total of 

three percent (3%) for both corporations 

and non-corporations. For corporate 

overpayments, the rate is the Federal 

short-term rate (1%) plus one 

percentage point (1%) for a total of two 

percent (2%). For overpayments made 

by non-corporations, the rate is the 

Federal short-term rate (1%) plus two 

percentage points (2%) for a total of 

three percent (3%). These interest rates 

are subject to change for the calendar 

quarter beginning April 1, 2013, and 

ending June 30, 2013. 

For the convenience of the importing 

public and U.S. Customs and Border 

Protection personnel the following list 

of IRS interest rates used, covering the 

period from before July of 1974 to date, 

to calculate interest on overdue 

accounts and refunds of customs duties, 

is published in summary format. 

Beginning date Ending date Under-payments 

(percent) 

Over-payments 

(percent) 

Corporate overpayments 

(Eff. 1–1–99) 

(percent) 

070174 063075 6 6 ...........................................

070175 013176 9 9 ...........................................

020176 013178 7 7 ...........................................

020178 013180 6 6 ...........................................

020180 013182 12 12 ...........................................

020182 123182 20 20 ...........................................

010183 063083 16 16 ...........................................

070183 123184 11 11 ...........................................

010185 063085 13 13 ...........................................

070185 123185 11 11 ...........................................

010186 063086 10 10 ...........................................

070186 123186 9 9 ...........................................

010187 093087 9 8 ...........................................

100187 123187 10 9 ...........................................

010188 033188 11 10 ...........................................

040188 093088 10 9 ...........................................

100188 033189 11 10 ...........................................

040189 093089 12 11 ...........................................

100189 033191 11 10 ...........................................

040191 123191 10 9 ...........................................

010192 033192 9 8 ...........................................

040192 093092 8 7 ...........................................

100192 063094 7 6 ...........................................

070194 093094 8 7 ...........................................

100194 033195 9 8 ...........................................

040195 063095 10 9 ...........................................

070195 033196 9 8 ...........................................

040196 063096 8 7 ...........................................

070196 033198 9 8 ...........................................

040198 123198 8 7 ...........................................

010199 033199 7 7 6 

040199 033100 8 8 7 

040100 033101 9 9 8 

040101 063001 8 8 7 

070101 123101 7 7 6 

010102 123102 6 6 5 

010103 093003 5 5 4 

100103 033104 4 4 3 

040104 063004 5 5 4 

070104 093004 4 4 3 

100104 033105 5 5 4 

040105 093005 6 6 5 

100105 063006 7 7 6 

070106 123107 8 8 7 

010108 033108 7 7 6 


srobinson on DSK4SPTVN1PROD with 
1224 Federal Register / Vol. 78, No. 5 / Tuesday, January 8, 2013 / Notices 

Beginning date Ending date Under-payments 

(percent) 

Over-payments 

(percent) 

Corporate overpayments 

(Eff. 1–1–99) 

(percent) 

040108 063008 6 6 5 

070108 093008 5 5 4 

100108 123108 6 6 5 

010109 033109 5 5 4 

040109 123110 4 4 3 

010111 033111 3 3 2 

040111 093011 4 4 3 

100111 033113 3 3 2 

Dated: January 2, 2013. 

Thomas S. Winkowski, 

Acting Deputy Commissioner, U.S. Customs 

and Border Protection. 

[FR Doc. 2013–00146 Filed 1–7–13; 8:45 am] 

BILLING CODE 9111–14–P 

DEPARTMENT OF HOUSING AND 

URBAN DEVELOPMENT 

[Docket No. FR–5667–N–01] 

Supportive Housing for the Elderly; 

Advance Notice of Senior Preservation 

Rental Assistance Contracts Award 

Process 

AGENCY: Office of the Assistant 

Secretary for Housing—Federal Housing 

Commissioner, (HUD). 

ACTION: Notice. 

SUMMARY: The Section 202 Supportive 

Housing for the Elderly Act of 2010, 

signed into law in January 2011, 

authorizes HUD to provide Senior 

Preservation Rental Assistance 

Contracts (SPRACs) with 20-year terms 

to prevent displacement of elderly 

residents of certain projects assisted 

under HUD’s Section 202 Supportive 

Housing for the Elderly program in the 

case of refinancing or recapitalization 

and to further preserve and maintain 

affordability of Section 202 Direct Loan 

projects. In Fiscal Year (FY) 2012, $16 

million was made available for SPRAC 

funding. This notice advises of HUD’s 

intent to award SPRACs through the 

proposed application process described 

in this notice. HUD is soliciting 

comments on the proposed process for 

awarding SPRACs and the associated 

criteria for establishing eligibility to 

apply for a SPRAC. 

DATES: Comment Due Date: March 11, 

2013. 

ADDRESSES: Interested persons are 

invited to submit comments regarding 

this notice to the Regulations Division, 

Office of General Counsel, Department 

of Housing and Urban Development, 

451 7th Street SW., Room 10276, 

Washington, DC 20410–0500. 

Communications must refer to the above 

docket number and title. There are two 

methods for submitting public 

comments. All submissions must refer 

to the above docket number and title. 

1. Submission of Comments by Mail. 

Comments may be submitted by mail to 

the Regulations Division, Office of 

General Counsel, Department of 

Housing and Urban Development, 451 

7th Street SW., Room 10276, 

Washington, DC 20410–0500. 

2. Electronic Submission of 

Comments. Interested persons may 

submit comments electronically through 

the Federal eRulemaking Portal at 

www.regulations.gov. HUD strongly 

encourages commenters to submit 

comments electronically. Electronic 

submission of comments allows the 

commenter maximum time to prepare 

and submit a comment, ensures timely 

receipt by HUD, and enables HUD to 

make them immediately available to the 

public. Comments submitted 

electronically through the 

www.regulations.gov Web site can be 

viewed by other commenters and 

interested members of the public. 

Commenters should follow the 

instructions provided on that site to 

submit comments electronically. 

Note: To receive consideration as public 

comments, comments must be submitted 

through one of the two methods specified 

above. Again, all submissions must refer to 

the docket number and title of the notice. 

No Facsimile Comments. Facsimile 

(FAX) comments are not acceptable. 

Public Inspection of Public 

Comments. All properly submitted 

comments and communications 

submitted to HUD will be available for 

public inspection and copying between 

8 a.m. and 5 p.m. weekdays at the above 

address. Due to security measures at the 

HUD Headquarters building, an 

appointment to review the public 

comments must be scheduled in 

advance by calling the Regulations 

Division at 202–708–3055 (this is not a 

toll-free number). Individuals with 

speech or hearing impairments may 

access this number via TTY by calling 

the Federal Relay Service at 800–877– 

8339. Copies of all comments submitted 

are available for inspection and 

downloading at www.regulations.gov. 

FOR FURTHER INFORMATION CONTACT: 

Margaret Salazar, Deputy Director of the 

Office of Affordable Housing 

Development, Office of Multifamily 

Housing Programs, Office of Housing, 

Department of Housing and Urban 

Development, 451 7th Street SW., Room 

6112, Washington, DC 20410; telephone 

number 202–708–2495 (this is not a tollfree number). Persons with hearing or 

speech impairments may access this 

number through TTY by calling the tollfree Federal Relay Service at 800–877– 

8339. 

SUPPLEMENTARY INFORMATION: 

I. Background 

The Section 202 Supportive Housing 

for the Elderly Act of 2010 (Pub. L. 111– 

372, approved January 4, 2011) (Section 

202 of 2010 Act) authorizes HUD to 

provide SPRACs with 20-year terms to 

prevent displacement of elderly 

residents of certain projects assisted 

under HUD’s Section 202 Supportive 

Housing for the Elderly program 

(Section 202 program) in the case of 

refinancing or recapitalization and to 

further preserve and maintain 

affordability of Section 202 Direct Loan 

projects. General authority for a Section 

202 Direct Loan is provided by Section 

811 of the American Homeownership 

and Economic Opportunity (AHEO) Act 

of 2000, as amended by the Section 202 

of 2010 Act (12 U.S.C. 1701q note). 

Pursuant to this authority, SPRAC 

assistance may be provided to Section 

202 properties with original interest 

rates of 6 percent or less (financed prior 

to 1974), when the property is 

refinanced to make capital repairs and 

the owner does not anticipate debt 

service savings from the refinance. In 

FY 2012, $16 million was made 

available for SPRAC funding. 

II. This Notice—Solicitation of 

Comment 

This notice advises of HUD’s intent to 

award SPRACs through the proposed 

application process described in this 

notice. HUD is soliciting comments on 


srobinson on DSK4SPTVN1PROD with