28932 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

DEPARTMENT OF THE TREASURY

Customs Service

19 CFR Parts 10, 12, 102 and 134

[T.D. 96–48]

RIN 1515–AB34

Rules for Determining the Country of

Origin of a Good for Purposes of

Annex 311 of the North American Free

Trade Agreement

AGENCY: Customs Service, Department

of the Treasury.

ACTION: Final rule.

SUMMARY: This document adopts as a

final rule, with some modifications,

interim amendments to the Customs

Regulations which established the rules

for determining when the country of

origin of a good is one of the parties to

the North American Free Trade

Agreement (NAFTA) as required by

Annex 311 of the NAFTA. These final

NAFTA Marking Rules apply only to all

goods imported from Canada or Mexico

other than textile and apparel products,

and do not apply to trade with other

countries.

EFFECTIVE DATE: August 5, 1996. These

regulations shall apply to goods entered,

or withdrawn from warehouse, for

consumption on or after August 5, 1996.

FOR FURTHER INFORMATION CONTACT:

Sandra L. Gethers, Office of Regulations

and Rulings (202–482–6980).

SUPPLEMENTARY INFORMATION:

Background

On January 3, 1994 Customs

published two documents in the

Federal Register. One of these

documents, T.D. 94–4 (59 FR 110), set

forth as interim regulations, effective

January 1, 1994, rules for determining

the country of origin of goods for

purposes of Annex 311 of the North

American Free Trade Agreement

(NAFTA). The other document (59 FR

141) proposed (1) to apply the same

rules (set forth at 59 FR 110) to

determine the country of origin of

merchandise in all cases under the

Customs and related laws and the

navigation laws of the United States and

(2) to amend various provisons within

parts 4, 10, 12, 134 and 177 of the

Customs Regulations (19 CFR parts 4,

10, 12, 134 and 177) to ensure that these

rules would control wherever language

requiring a country of origin

determination appears in those other

regulatory provisions; this notice of

proposed rulemaking represented a

refinement and replacement of an

earlier proposal published in the

Federal Register on September 25, 1991

(56 FR 48448). Both documents

provided for a 90-day public comment

period, subsequently extended to July 5,

1994, by notices published in the

Federal Register on March 10, 1994 (59

FR 11225) and March 11, 1994 (59 FR

11547). On February 3, 1994, a notice

was published in the Federal Register

(59 FR 5082) setting forth corrections to

the interim regulations contained in

T.D. 94–4.

The rules set forth in T.D. 94–4 were

made effective January 1, 1994, for trade

with Canada and Mexico in order to

fulfill the United States obligation under

paragraph 1 of NAFTA Annex 311

which provides that the parties to the

NAFTA shall establish, by January 1,

1994, rules (referred to as ‘‘Marking

Rules’’) for determining whether a good

is a good of a party (that is, whether the

country of origin of a good is either the

United States, Canada or Mexico) for

purposes of the following NAFTA

Annexes: (1) Annex 311 (Country of

Origin Marking); (2) Annex 300–B

(Textile and Apparel Goods); and (3)

Annex 302.2 (Tariff Elimination). T.D.

94–4 set forth these interim ‘‘Marking

Rules’’ as a new part 102 of the Customs

Regulations (19 CFR Part 102), entitled

‘‘Rules of Origin’’, and also set forth

consequential conforming interim

amendments to existing sections within

parts 12 and 134 of the Customs

Regulations (19 CFR parts 12 and 134).

Interim part 102 consists of §§ 102.0–

102.20 and, following § 102.0 (Scope), is

divided into two subparts. Subpart A is

entitled ‘‘General’’ and consists of

§ 102.1 (Definitions), and Subpart B is

entitled ‘‘Rules of Origin’’ and consists

of §§ 102.11 through 102.20. Section

102.11 sets forth the general rules for

determining the country of origin of a

good and consists of paragraphs (a)

through (d) which are applied in a

hierarchical and sequential manner.

Thus, reference must be had first to

paragraph (a) which provides that the

country of origin of a good is: under

subparagraph (1), the country in which

the good is wholly obtained or

produced; under subparagraph (2), the

country in which the good is produced

exclusively from domestic materials; or,

under subparagraph (3), the country in

which each foreign material

incorporated in the good undergoes an

applicable change in tariff classification

set out in § 102.20 and/or satisfies any

other applicable requirements contained

in that section or elsewhere in part 102.

If the country of origin cannot be

determined under paragraph (a) because

the good does not meet the terms of

subparagraph (1), (2) or (3), then resort

must be had to paragraph (b) and, if that

fails, then to paragraph (c) and, if that

fails, finally to paragraph (d). Sections

102.12–102.19 set forth additional rules

that serve to interpret, clarify, limit or

otherwise control the application of the

general rules contained in § 102.11 as

well as the specific rules contained in

§ 102.20. Section 102.20 contains the

specific change in tariff classification

rules and/or related requirements

referred to in the country of origin rule

set forth in § 102.11(a)(3); the rules in

§ 102.20 are set forth for each

Harmonized Tariff Schedule of the

United States (HTSUS) chapter, and the

applicable rule is determined by the

HTSUS tariff classification that is

applicable to the finished good at the

time the country of origin determination

is being made.

In view of the fact that the January 3,

1994, notice of proposed rulemaking

presented the same regulatory scheme

as the rules contained in T.D. 94–4, each

document referred to the other and

stated that public comments submitted

in response to either document would

be considered in connection with the

review of both documents. The notice of

proposed rulemaking further indicated

that the background section and interim

Part 102 regulatory texts set forth in T.D.

94–4 were applicable to it. Thus, it was

intended that the two documents be

read together so that, following public

notice and comment procedures, one

final rule document could be derived

from the interim and proposed rule

documents, consistent with the overall

goal of promulgating uniform rules of

origin for Customs and related purposes.

Based on a review of the comments

received in response to the interim and

proposed rule documents published in

the Federal Register on January 3, 1994,

and as a result of independent review of

the interim and proposed texts within

Customs, it was determined that some

clarification and further explanation of

the intent behind the proposed uniform

rule concept should be provided and

that some changes should be made to

the interim and proposed texts and that

those changes should be the subject of

public notice and comment procedures

before proceeding to the final rule stage

in this matter; the interim texts as

published in T.D. 94–4 (and as

subsequently corrected) would remain

in effect pending completion of such

final rule action. In addition, Customs

determined that public comments

should be solicited regarding the

appropriate use of a delayed effective

date for any final rule resulting from the

interim and proposed rules and from

any additional proposed changes to

those interim and proposed rules.
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28933

Accordingly, on May 5, 1995,

Customs published in the Federal

Register (60 FR 22312) a document that

(1) provided supplemental background

information regarding the proposed

uniform rule concept, (2) set forth

proposals to amend the interim

regulatory texts contained in T.D. 94–4

published at 59 FR 110 and corrected at

59 FR 5082, (3) republished (and thus

replaced) all of the proposed regulatory

amendments published at 59 FR 141 on

January 3, 1994, with certain changes

thereto, and (4) also invited public

comments on the appropriate effective

date for a final rule on this matter. The

May 5, 1995, document stated that it

was the intention of Customs to address

in that document only those comments

submitted in response to the January 3,

1994, notices that involved substantive

changes to the interim or proposed texts

requiring further public comment

procedures; other such previously

submitted comments would be

addressed in an appropriate final rule or

other document to be published at a

later date. Comments would be accepted

and considered in response to that

document only in regard to (1) the

proposed changes to the interim

regulatory texts as discussed and set

forth therein, (2) all other proposed

regulatory amendments as discussed

and set forth therein which represented

a substantive change to the proposals

published on January 3, 1994, and (3)

the final rule delayed effective date

issue. Therefore, comments which

concerned other issues involved in the

January 3, 1994, documents, or which

did not otherwise relate to the new

proposals set forth in the May 5, 1995,

document, would not be accepted and

considered by Customs. The May 5,

1995, document also stated that, for

purposes of that document, the

background sections of the January 3,

1994, interim and proposed rule

documents were applicable except

where otherwise required by a change

set forth in that document. The May 5,

1995, document provided for a 45-day

public comment period which was

subsequently extended to July 19, 1995,

by a notice published in the Federal

Register on June 5, 1995 (60 FR 29520).

After publication of the May 5, 1995,

notice of proposed rulemaking,

additional issues came to the attention

of Customs that warranted publication

of further proposed changes to the

interim regulatory texts published in

T.D. 94–4, with opportunity for public

comment thereon. Accordingly, on July

12, 1995, Customs published in the

Federal Register (60 FR 35878) a notice

of proposed rulemaking setting forth

additional proposed changes to the tariff

shift and other requirements of interim

§ 102.20. Final action on the additional

proposals set forth in that document

also would be reflected in the single

final rule document intended, as stated

in the May 5, 1995, document, to cover

both the T.D. 94–4 interim regulations

and the subsequently published

proposed regulatory amendments. Since

that July 12, 1995, document set forth

proposals that were in addition to the

proposed changes to the T.D. 94–4

interim regulations contained in the

May 5, 1995, proposed rule document,

the background section of that May 5,

1995, document was stated to be

applicable for purposes of the July 12,

1995, document except where otherwise

required by a change set forth in the

latter document. Comments submitted

in response to the July 12, 1995,

document would be accepted and

considered only to the extent that they

address specific proposals set forth in

that document; comments submitted in

regard to matters raised in the May 5,

1995, proposed rule document that were

not related to a specific proposal

contained in the July 12, 1995,

document would remain subject to the

public comment period specified in the

earlier document. The public comment

period specified in the July 12, 1995,

document closed on August 28, 1995,

and a correction document involving

the Background discussion in that

document was published in the Federal

Register on July 31, 1995 (60 FR 38982).

Deferral of Decision to Extend Section

102 to All Trade

Customs has decided that the

proposal to extend Section 102 to all

trade, as reflected in the May 5, 1995,

notice of proposed rulemaking, should

not be adopted as a final rule at this

time but rather should remain under

consideration for implementation at a

later date. Accordingly, this final rule

document concerns only the interim

NAFTA Marking Rules (as amended by

T.D. 95–69 discussed above) and related

interim texts published on January 3,

1994, and those proposed regulatory

amendments published on May 5 and

July 12, 1995, that relate only to those

interim texts, with certain changes

thereto as discussed elsewhere in this

document. Thus, this document does

not include those May 5, 1995,

proposed regulatory changes under the

uniform rule concept involving part 10

(§§ 10.12, 10.14, 10.171, 10.176, 10.191

and 10.195), part 12 (§ 12.130), part 102

(§ 102.0), part 134 (§§ 134.1 and 134.35)

and part 177 (§ 177.22). Consequently,

those submitted public comments that

addressed the proposed regulatory

changes that would apply a uniform

method of determining origin to all

trade, including the delayed effective

date issue, are not discussed in this

document but rather will be dealt with,

as appropriate, in a future Federal

Register document once a final decision

is taken on whether to apply a uniform

method of determining origin to all

trade.

Rules of Origin for Textile and Apparel

Products

On September 5, 1995, Customs

published in the Federal Register (60

FR 46188) T.D. 95–69 which set forth

final amendments to the Customs

Regulations to implement the provisions

of section 334(b) of the Uruguay Round

Agreements Act (‘‘the Act’’), Public Law

103–465, 108 Stat. 4809, regarding the

country of origin of textile and apparel

products. Those final regulations will

apply to goods entered, or withdrawn

from warehouse, for consumption on or

after July 1, 1996, and, except for the

purpose of identifying products of Israel

and except as otherwise provided for by

statute, will govern the determination of

the country of origin of imported textile

and apparel products for purposes of all

laws enforced by Customs. The

regulatory provisions in T.D. 95–69 that

implement the basic origin principles of

section 334(b) of the Act are contained

in a new § 102.21 of the Customs

Regulations (19 CFR 102.21), and, in

order to reflect the broad applicability

and precedence of the statutory origin

principles as implemented by those

§ 102.21 rules, T.D. 95–69 also included

consequential cross-reference

amendments to §§ 12.130, 102.0 and

102.11 of the Customs Regulations (19

CFR 12.130, 102.0 and 102.11).

New § 102.21 was modeled on the

approach taken in the interim Part 102

texts as published in T.D. 94–4 and thus

incorporates a general statement of

applicability (paragraph (a)), various

definitions (paragraph (b)), general

origin rules (paragraphs (c) and (d)), and

specific tariff shift and/or other

requirements (paragraph (e)) that apply

under the second general rule. Of

particular note for purposes of the

present document is the definition of

‘‘textile or apparel product’’ in

§ 102.21(b)(5) which delineates the class

of goods covered by the § 102.21 rules.

That definition identifies those goods

with reference to classification in the

HTSUS and refers to Chapters 50

through 63 (that is, all of Section XI) of

the HTSUS as well as to specific

headings and 6-, 8- or 10-digit

subheadings of the HTSUS that fall

outside Section XI. Thus, if a good is

classifiable in an HTSUS provision
28934 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

listed in § 102.21(b)(5), precedence must

be given to the § 102.21 rules over any

other regulatory origin provision with

regard to that good, including any origin

rules contained elsewhere in part 102.

The consequential amendments to

§§ 12.130, 102.0 and 102.11 mentioned

above were intended to reflect this

precedence principle.

In view of the precedence that must

be given to the § 102.21 origin rules

which were adopted as a final rule after

the completion of separate public notice

and comment procedures, it is clear

that, for purposes of the present

document, all earlier public comments

as regards any goods now covered by

§ 102.21 relating to textile and apparel

products (that is, those submitted in

response to the interim and proposed

rule documents discussed above) have

been rendered moot and thus are no

longer relevant. Accordingly, this

document contains no substantive

discussion of any such comments

insofar as they involve § 102.21 goods.

Since the § 102.21 origin rules will

also apply for the purposes cited

elsewhere in part 102 (that is, in

§ 102.0), Customs believes that all

appearances of possible conflict

between the two sets of rules should be

avoided. In keeping with the precedence

to be given to the § 102.21 rules, the

most appropriate means for

accomplishing this is (1) to remove, or

otherwise exclude, from the table under

§ 102.20 all those HTSUS references,

together with their related tariff shift

and/or other requirements, that are

included in the § 102.21(b)(5) definition

of ‘‘textile or apparel product’’ and (2)

in order to ensure continuity of

regulatory standards, to provide that the

regulations set forth in this final rule

document will take effect on July 1,

1996, when the § 102.21 provisions

become operative (see § 102.21(a)).

Accordingly, the following changes

have been made to the § 102.20 table as

set forth below to reflect these

considerations:

1. The listing for subheading 3005.90

has been removed.

2. A new Chapter 39 Note has been

added to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheadings 3921.12.15, 3921.13.15,

and 3921.90.2550.

3. Since the new Chapter 42 Note as

proposed in the May 5, 1995, document

would be superseded by the § 102.21

provisions, this proposed Note has been

modified to simply provide that origin

shall be determined under the

provisions of § 102.21 in the case of

goods classified in subheadings

4202.12.40–80, 4202.22.40–80,

4202.32.40–95, 4202.92.15–30, and

4202.92.60–90.

4. The Section XI provisions have

been removed.

5. The Chapter 64 Note has been

modified by adding a sentence at the

end to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheadings 6405.20.60, 6406.10.77,

6406.10.90, and 6406.99.15.

6. Since the new Chapter 65 Note as

proposed in the May 5, 1995, document

would be superseded by the § 102.21

provisions, this proposed Note has been

omitted.

7. The listing for headings 6501–6502

has been removed.

8. The listing for headings 6503–6506

has been replaced by the following: (1)

A listing for subheading 6505.10 (hairnets), which specifies a change to that

subheading from any other subheading;

and (2) a listing for heading 6506, which

follows the interim tariff shift rules for

headings 6503–6506 but with one

consequential editorial change in the

first rule.

9. The listing for heading 6601 has

been removed.

10. A new Chapter 70 Note has been

added to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheadings 7019.19.15 and

7019.19.28 (subheadings 7019.10.15 and

7019.10.28 in the interim texts—see the

1996 HTSUS conforming changes

discussion below).

11. The listing for subheading 7019.20

has been removed.

12. The listing for subheadings

8708.10–8708–29 has been replaced by

separate listings for subheading 8708.10

and for subheading 8708.29, with the

tariff shift rule in each case following

the interim rule.

13. The listing for headings 8804–

8805 has been replaced by a listing for

heading 8805, with consequential

editorial changes to the interim tariff

shift rule to reflect that only one

heading is involved.

14. A new Chapter 91 Note has been

added to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheading 9113.90.40.

15. The new Chapter 94 Note

proposed in the May 5, 1995, document

has been modified by adding a sentence

at the end to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheadings 9404.90.10 and

9404.90.80–95.

16. The listing for subheading 9502.91

has been removed.

17. A new Chapter 96 Note has been

added to provide that origin shall be

determined under the provisions of

§ 102.21 in the case of goods classified

in subheading 9612.10.9010.

In addition, for the above reasons and

based on the considerations reflected in

the below comment discussion

regarding § 102.19(a), references to

‘‘§ 102.21’’ have been added to the texts

of §§ 102.13, 102.15 and 102.17 as set

forth below.

Changes to Conform to 1996 HTSUS

A number of conforming changes

have been made to the table under

§ 102.20 as set forth in this document,

principally to the tariff shift rules

therein, to reflect changes included in

the 1996 version of the HTSUS as a

result of amendments made to the

international Harmonized System.

Those HTSUS changes involve

primarily the product coverage and/or

numbering of some headings and

subheadings, and the conforming

changes reflected in the § 102.20 texts in

this document are not intended to have

any other substantive effect. The

specific § 102.20 conforming changes

incorporated in this document are

reflected in the text of Note 1 to Section

VI and in the following heading and

subheading listings: 0405.10, 0405.20,

0405.90, 0406, 0901.90, 1520, 1521–

1522, 1903, 1904.10, 1904.20, 1904.90,

1905, 2106.90, 2207, 2208.20–2208.70,

2208.90, 2836.99, 2841.61–2841.69,

2848, 2849.10–2849.90, 2903.11–

2903.30, 2903.41–2903.49, 2903.51–

2904.90, 2905.11–2905.19, 2905.45,

2914.31–2914.39, 2914.40–2914.70,

2932.11–2932.99, 3206.11–3206.19,

3206.20–3209.90, 3214.10–3214.90,

3302, 3304.10–3306.10, 3306.20,

3306.90–3307.90, 3402.11, 3402.12–

3402.20, 3502.11–3502.19, 3502.20–

3502.90, 3823.11–3823.13, 3823.19,

3823.70, 3824.10, 3824.20, 3824.30,

3824.40, 3824.50, 3824.60, 3824.71–

3824.90, 4823.60–4823.70, 4823.90,

7019.11–7019.19, 7019.40–7019.59,

7116, 7507.11–7508.90, 7616.10–

7616.99, 7907, 8005, 8406.10, 8406.81–

8406.82, 8456.10–8456.99, 8469.11–

8469.12, 8469.20–8469.30, 8470.10–

8471.50, 8471.60–8472.90, 8475.10,

8475.21–8475.29, 8476.21–8476.89,

8506.10, 8506.30, 8506.40, 8506.50–

8506.80, 8510.10–8510.30, 8517.11–

8517.80, 8519.10–8519.40, 8519.92–

8519.93, 8519.99, 8520.10–8520.20,

8520.32, 8520.33, 8520.39–8520.90,

8521.10 8521.90, 8525.30–8525.40,

8527.12–8527.13, 8527.19–8527.90,

8528.12–8528.30, 8539.10–8539.31,

8539.32–8539.39, 8539.41–8539.49,

8540.11–8540.20, 8540.40–8540.60,

8540.71–8540.99, 8543.11–8543.19,
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28935

8543.20–8543.30, 8543.40–8543.89,

9007.11–9007.19, 9007.20, 9010.10,

9010.41–9010.50, 9010.60, 9018.11,

9018.12–9018.14, 9018.19, 9022.12–

9022.14, 9022.19–9022.90, 9030.10–

9030.40, 9030.82–9030.83, 9030.89–

9030.90, 9031.10–9031.30, 9031.41–

9031.49, 9031.80, and 9614.20. In order

to accurately reflect the public

comments and the context in which

they were submitted, the comment

discussion set forth below refers to the

interim § 102.20 texts and published

proposed changes thereto and thus does

not reflect these conforming changes.

Discussion of Comments

A total of 183 commenters responded

to the solicitation of comments in the

interim and proposed rule documents

referred to above. The comments

submitted, except those relating to

textile and apparel products and those

relating to the uniform origin rule

concept, and the Customs responses

thereto are set forth below.

Removal of §§ 10.22, 102.14 and

134.43(e)—U.S. Goods Returned

Comments: Section 10.22, Customs

Regulations (19 CFR 10.22), provides

that assembled articles eligible for

subheading 9802.00.80, HTSUS,

treatment are considered products of the

country of assembly for purposes of

country of origin marking. Section

102.14 of the interim regulations

provides that U.S. goods advanced in

value or improved in condition abroad

are considered to be products of the

country where the U.S. goods were

advanced in value or improved in

condition, and § 134.43(e) of the interim

regulations provides for special methods

of marking goods the origin of which is

determined under § 102.14 of the

interim regulations. Five comments

opposed the removal of these sections,

and five comments favored their

removal.

The commenters opposing the

removal assert that since the foreign

assembly of U.S. components does not

necessarily result in a substantial

transformation or tariff shift, resulting in

a change in origin of a good, §§ 10.22

and 134.43(e) provide a means to

identify U.S. components in goods

assembled abroad. Additionally, in

situations where assembled goods

consist largely or entirely of U.S.-made

components and there is a change in

origin, it is claimed that the use of

‘‘Assembled in’’ will be eliminated, and

‘‘Made in’’ or ‘‘Product of’’ is not only

inaccurate, but does not serve the

purpose ‘‘to inform the ultimate

purchaser of the country of origin’’.

Furthermore, it is stated that U.S. Note

2(a), Subchapter II, Chapter 98, HTSUS,

still provides that any product of the

U.S. advanced in value or improved in

condition, or assembled abroad will be

considered a foreign article upon its

return to the U.S.

The commenters who favor the

removal of §§ 10.22, 102.14 and

134.43(e) assert that U.S. products

should not have to be marked upon

return to the U.S., unless they are

substantially transformed. Requiring

U.S. goods to be marked restricts U.S.

companies to the term ‘‘Assembled in’’

when all the components being

assembled are of U.S. origin, and it is

suggested that this does not advise the

ultimate purchaser as to the real origin

of the imported merchandise.

All of the comments, favorable and

unfavorable, urged the continued use of

‘‘Assembled in’’ when an eligible

subheading 9802.00.80, HTSUS,

assembly operation constitutes a

substantial transformation conferring

origin pursuant to § 102.20 of the

interim regulations. The commenters

also urged the general usage of the

legend ‘‘Assembled in’’ as a valid

country of origin marking when an

assembled good is a product of the

country indicated.

One commenter also suggested that if

§ 10.22 is removed without further

amending part 134 to authorize the use

of ‘‘Assembled in’’ for subheading

9802.00.80 merchandise, there will be

ambiguity as to whether ‘‘Assembled

in’’ is a permissible country of origin

marking under the Customs Regulations,

inasmuch as rulings approving the use

of ‘‘Assembled in’’ are still in effect.

Furthermore, if § 10.22 is removed, it

was suggested that Part 134 be amended

to confirm that in all cases, information

respecting assembly of an imported

product may be noted within an origin

statement.

Customs Response: Customs’ proposal

to remove § 10.22 was originally

discussed in the May 5, 1995, notice of

proposed rulemaking in the context of

the uniform rules proposal. However, as

demonstrated by the above comments,

the proposed removal of § 10.22 is

directly related to the proposed removal

of §§ 102.14 and 134.43(e) of the interim

regulations. For this reason, Customs is

responding collectively to comments

regarding the proposed removal of

§§ 10.22, 102.14 and 134.43(e).

Customs agrees that 19 U.S.C. 1304

does not preclude the use of

‘‘Assembled in’’ or require the use of

‘‘Made in’’ or ‘‘Product of’’ in a country

of origin statement. However, outside

the context of articles eligible for

subheading 9802.00.80, HTSUS,

treatment (i.e., when § 10.22 is

applicable), Customs in the past has by

rulings determined that the phrase

‘‘Assembled in’’ is not an acceptable

country of origin statement. Reference

was made by a commenter to C.S.D. 79–

244 as support that Customs approves of

the marking ‘‘Assembled in’’. However,

that determination involved calculators

assembled in Hong Kong with U.S. and/

or foreign components. Consequently, it

appears that the calculators imported

into the United States were eligible for

entry under item 807.00, Tariff

Schedules of the United States (TSUS)

(now subheading 9802.00.80, HTSUS).

It is clear that there has been confusion

as to the use of ‘‘Assembled in’’ when

articles eligible for subheading

9802.00.80, HTSUS, treatment contain

foreign components as demonstrated by

the series of inconsistent rulings

subsequent to the determination made

in HQ 731507. Consequently, instead of

modifying all of the inconsistent rulings

concerning the use of ‘‘Assembled in’’,

and since articles eligible for

subheading 9802.00.80, HTSUS,

treatment may not undergo a substantial

transformation or tariff shift in the

country of assembly, it is Customs’

opinion that § 10.22 as well as § 102.14

of the interim regulations should be

removed so that the country of origin of

articles assembled or advanced in value

abroad is determined in the same

manner as any other good imported into

the United States.

All of the comments mention the

purpose of 19 U.S.C. 1304, which is to

inform the ultimate purchaser of the

country of origin. Some of the

comments assert that § 10.22 provides

the ultimate purchaser with information

regarding the country of assembly and

the origin of the components used,

while other comments suggest that the

country of assembly may not necessarily

be the true country of origin. It is

Customs’ opinion that an ultimate

purchaser most likely will not be aware

that an article imported with the

marking ‘‘Assembled in’’ is eligible for

subheading 9802.00.80, HTSUS,

treatment. While U.S. Note 2(a),

Subchapter II, Chapter 98, HTSUS, does

provide that any product of the United

States advanced in value or improved in

condition, or assembled abroad, will be

considered a foreign article upon its

return to the United States, Customs has

reconsidered the position that this Note

applies for general country of origin

purposes. Therefore, once § 10.22 and

§ 102.14 of the interim regulations are

removed, all rulings based on those

regulations may no longer be relied

upon. Accordingly, goods of U.S. origin

which are assembled abroad or
28936 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

otherwise advanced in value or

improved in condition abroad, but

which do not undergo a change in origin

as a result of these operations, will not

be required to have any country of

origin marking pursuant to 19 U.S.C.

1304 when they are imported into the

United States.

However, since all of the comments

favor the use of ‘‘Assembled in’’,

Customs has reconsidered the proposal

to remove all regulations allowing the

use of this phrase. Therefore, § 134.43(e)

will be retained but in modified form,

as set forth below, so as to be limited to

assembled goods when the origin of

such goods is the country of final

assembly.

Section 102.1(g)—Definition of Wholly

Obtained or Produced

Comment: A commenter suggests

adoption of the Kyoto Convention Rules

of Origin definition of ‘‘wholly obtained

goods’’ in order to eliminate doubts as

to when a good is considered to be

wholly the growth, product or

manufacture of one country.

Customs response: The definition of

‘‘wholly obtained or produced’’

contained in § 102.1(g), which is

incorporated by reference in

§ 102.11(a)(1), is substantively identical

to the definition set forth in Annex D.1

to the Kyoto Convention, with the single

exception that the Part 102 definition

also includes goods taken from outer

space, provided that they are obtained

by that country or a person of that

country. Therefore, Customs agrees with

this commenter that the definition of

wholly obtained or produced goods,

which is patterned after Kyoto

Convention Annex D.1, provides more

predictability in determining when

goods are wholly the growth product or

manufacture of a single country.

Section 102.1(m)—Definition of Minor

Processing

Comment: One comment was received

regarding this section. This commenter

expressed concern regarding

subparagraph (5), which includes

‘‘[u]nloading, reloading, or any other

operation necessary to maintain the

good in good condition.’’ The

commenter stated that this language

appears overly broad and could be

misinterpreted to apply to industrial

operations necessary to preserve a good,

but which also alter the essential

character of the good. Therefore, this

commenter suggests that this provision

be amended to read as follows:

‘‘Unloading, reloading, or any other

insubstantial operation that does not

add significant value to the good and is

performed solely to preserve or

maintain the good in good condition for

shipment.’’

Customs Response: Customs

disagrees. The underlying premise of

this comment is that the definitions of

§ 102.1, unlike most regulatory

‘‘definitions’’, can operate

independently of other regulatory

provisions. This, however, is not the

case here. The definition of ‘‘minor

processing’’ only can operate in the

context of other rules set forth in part

102, particularly those provisions

setting forth a criterion for determining

origin. The definition of ‘‘minor

processing’’ does not operate as a

general disqualifer to the origin criteria

of other provisions, such as the way in

which the ‘‘non-qualifying operations’’

set forth in § 102.17 are generally

applicable to all determinations under

the specific tariff rules of § 102.20.

When the definition of ‘‘minor

processing’’ is applicable, it normally is

expressed as part of a ‘‘negative’’ origin

criterion, meaning that it is used to

illustrate when a change of origin does

not occur. Therefore, if the other

operations suggested by the commenter

also are performed, the good will not be

deemed to have been produced ‘‘only’’

as a result of ‘‘minor processing’’, and

thus a change of origin could still be

possible under the rules.

Section 102.1(p)—Definition of

Substantial Transformation

Comment: One commenter submits

that as a result of the proposed

elimination of the definition, the

question of what constitutes a

‘‘substantial transformation’’ now can be

determined only on the basis of the

specific § 102.20 rule. The commenter

also suggests that in the absence of a

general definition of ‘‘substantial

transformation’’, there will be a lack of

certainty which is not only needed for

Customs origin determinations, but also

for other purposes such as origin

determinations relating to ‘‘industrial

property rights’’.

Customs Response: Customs

disagrees. First, it is the position of

Customs that the principle of substantial

transformation is reflected and codified

not only in the § 102.20 rules but also

in the entire hierarchy of § 102.11. In

fact, § 102.20 is only applicable through

its incorporation in § 102.11(a)(3). The

definition of ‘‘substantial

transformation’’ was set forth in interim

§ 102.1(p) only because of the references

made to that term in interim § 102.16

and in certain specific interim rules

contained in § 102.20. Customs,

however, stated in the May 5, 1995,

notice of proposed rulemaking that

§ 102.16 (in its entirety) and the

references to ‘‘substantial

transformation’’ contained in certain

§ 102.20 specific rules were being

proposed for removal because

experience in administering the interim

regulations had demonstrated that the

application of the hierarchy contained

in § 102.11 will yield a result that

codifies the substantial transformation

principle set forth in interim § 102.1(p).

If origin is not determined under

§ 102.11(a)(3) [the section in which the

§ 102.20 rules are incorporated by

reference], the question of whether or

not there has been a substantial

transformation is not yet answered; the

next step in the hierarchy must be

considered. As a result of the

application of the hierarchy, a specific

determination of origin of a good can be

made. If, in the final analysis, the origin

of the good under the hierarchy is

different from the origin of its materials,

then there will have been a substantial

transformation of those materials.

Therefore, contrary to the underlying

premise of this comment, it is

specifically because of the need for

more certainty in origin determinations

that Customs is expressing the

substantial transformation principle

through the step-by-step operation of

the § 102.11 hierarchy. Customs’

proposed removal of those provisions,

which merely incorporate the abstract

definition of ‘‘substantial

transformation’’ without expressing

when the criteria have been met, is

consistent with and promotes the

overall objective of certainty.

Section 102.11(c)—General Rules

Comments: Two commenters state

that § 102.11(c), as applied to mixtures

and composite goods, is contrary to 19

U.S.C. 1304 and to judicial precedents

promulgated thereunder. These

commenters expressed concern that

pursuant to § 102.11(c), when no single

material, foreign or domestic, imparts

the essential character, the mixture will

have the origins of the significant

materials or ingredients used to produce

that mixture, as opposed to considering

the mixture itself as a new and different

article of commerce.

These commenters also suggest that

Customs include an ‘‘escape clause’’ to

appropriately deal with these and other

unforeseeable instances when

processing in a country under existing

precedent constitutes a substantial

transformation, but is not treated as

such under the new rules. In this regard,

the commenter suggests that when

processing is deemed insufficient under

§ 102.11(a)(3) or § 102.11(b) to confer

origin in the country where the

processing takes place, this should
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28937

create a presumption that no substantial

transformation occurs. However, this

presumption could be rebutted by

factual evidence establishing that the

processing causes a change in name,

character or use.

Customs Response: Customs

disagrees. Section 102.11 sets forth the

hierarchical rules for determining the

country of origin of goods other than

textile and apparel products which are

covered by § 102.21. If the country of

origin of a good is not determined under

§ 102.11(a) or (b), § 102.11(c) of the

hierarchy must be considered. Thus, by

the time § 102.11(c) of the hierarchy is

reached, it already has been determined:

(1) That the processing performed with

respect to foreign materials contained in

the good was insufficient to meet the

specific tariff rule under § 102.20; and

(2) for mixtures and composite goods,

that there is no single material that

imparts the essential character to such

goods.

Consequently, when this provision is

applicable, the country of origin of such

sets, mixtures, or composite goods is the

country or countries of origin of those

materials or components meriting equal

consideration for determining the

essential character of the good. A

material or component need not be

determined to actually impart the

essential character to a good in order to

merit equal consideration (i.e., be

considered a consequential material or

component) for such purpose of making

the essential character determination for

classification or origin purposes.

Section 102.11(c) is not a departure

from Customs practice under the

country of origin marking statute.

Indeed, it follows and is specifically

intended to codify Treasury Decision

(T.D.) 91–7, dated January 8, 1991, in

which Customs considered, inter alia,

the country of origin marking

requirements of GRI 3, HTSUS, sets,

mixtures and composite goods. In this

decision, Customs stated that,

notwithstanding that these goods may

be classified pursuant to GRI 3(b) on the

basis of the material or component that

imparts the essential character to the

good, ‘‘if the materials or components

are not substantially transformed as a

result of their inclusion in a set or

mixed or composite goods * * * each

item must be individually marked to

indicate its own country of origin.’’

Contrary to the suggestions by the

commenters, the practice established in

T.D. 91–7 has not been limited to ‘‘sets’’,

but also has been applied to mixtures

and composite goods. See HQ 735085

dated June 4, 1993.

With regard to the suggestion by one

of the commenters that the Part 102

rules contain an escape clause, it is the

opinion of Customs that such a clause

would negate the primary benefit of

these rules: Codification of the

substantial transformation principle as

interpreted by Customs and the courts,

while providing predictability,

transparency and objectivity in origin

determinations.

Sections 102.12 and 102.11(b)(2)—

Fungible Goods and Materials

Comment: One comment was received

regarding § 102.12 which provides for

the country of origin determination of

commingled fungible goods to be made

by either direct physical identification

or, if that is impractical, by the use of

one of the inventory management

methods provided under the Appendix

to Part 181 of the Customs Regulations

(which implements the preferential

tariff treatment provisions of the

NAFTA). While this commenter

endorsed the need for an alternative

method to physical identification, the

commenter stated that the use of an

inventory management method to

determine origin of these goods is not

workable. As an alternative, the

commenter suggests that Customs

expand and codify the ‘‘major supplier’’

marking policy that exists for country of

origin marking of fruit juice products

made from juice concentrate of various

countries.

Customs Response: First, it should be

clarified that the ‘‘major supplier

marking’’ policy is not an origin rule,

but rather is a manner of marking policy

that is applicable to certain goods after

the determination of origin is made. In

contrast, § 102.12, like all of the rules of

part 102, will be used to determine the

origin of the good at issue. It is only

after reaching the origin determination

that Customs can address the issue of

the appropriate manner of marking the

good for purposes of 19 U.S.C. 1304.

Both the ‘‘major-supplier’’ rule, which

applies to manner of marking, and the

inventory management option, which is

used to determine origin, co-exist. If,

under the inventory management

method, a single origin is determined,

there is no need to use a ‘‘majorsupplier’’ approach to mark the good in

question.

In T.D. 89–66, dated April 7, 1989,

which was cited by this commenter,

Customs addressed only the issue of the

number of countries representing

sources of the foreign juice concentrate

that had to be physically identified on

the retail juice products. The question of

origin regarding the juice products

already had been settled as a result of

the Court of International Trade

decision in National Juice Products

Assn. v. United States, 628 F.Supp. 978

(CIT 1986).

Therefore, Customs reserves the right

to address the manner of marking issue

relating to commingled goods and

materials on a case-by-case basis similar

to the way the issue was addressed for

the juice concentrate products. Customs

believes, however, that §§ 102.11(b)(2)

and 102.12 provide a practical solution

to the problems that gave rise to the

major supplier country of origin

marking policy. These provisions allow

for practical and logistical problems to

be resolved at the time the origin

determination is being made for

fungible goods and materials. Contrary

to the commenter’s suggestion, the

specific inventory management methods

set forth in the appendix to part 181 of

the Customs Regulations are not so

circumscribed to the NAFTA preference

rules that they cannot be employed for

other origin determination purposes.

The examples provided in that

Appendix clearly illustrate how

accounting methods can be used to

assign origin to inputs and outputs.

Therefore, Customs believes that

inventory management methods allow

for adaptable recordkeeping that

provides another option to determine

origin.

Section 102.13—De Minimis

Comments: Two commenters

expressed concern that the de minimis

rule set forth in § 102.13 is not

applicable to certain agriculture

products. These commenters note that if

a ‘‘major supplier’’ marking rule is

adopted, it can include a de minimis

amount of 7 percent.

Customs Response: These

commenters also confuse ‘‘manner of

marking’’ issues with ‘‘determination of

origin’’ issues. Section 102.13 is only

applicable in conjunction with the

specific tariff rules of § 102.20. Due to

the nature of these products and

because of health and food safety

concerns, Customs has exercised its

discretion not to allow a de minimis

standard to apply in determining the

origin of most agricultural products.

This policy, which is incorporated into

§ 102.13, is consistent with Customs’

past practice with regard to country of

origin determinations of agricultural

products. Therefore, Customs will retain

the rule in § 102.13 as it currently exists.

Removal of § 102.16—Goods and Its

Parts; Parts of Parts

Comments: Two commenters express

concern that, by the elimination of

§ 102.16, Customs is adopting an

‘‘essential character’’ standard in its

origin hierarchy for all goods (except for
28938 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

‘‘sets’’) for which country of origin is

not determined pursuant to § 102.11(a).

Another commenter submits that by

eliminating § 102.16, Customs ignores

the situation in which imported goods

classified as an ‘‘unfinished article’’

under GRI 2(a) may be subject to

extensive and significant manufacturing

processes that change the name,

character, or use of the article and add

enormous value to the finished product.

This commenter suggests adopting the

NAFTA preference rules which in some

cases include a value added criterion for

determining ‘‘originating’’ status.

In opposing the removal of § 102.16,

these commenters also expressed

concern that the hierarchy set forth in

§ 102.11 does not codify the principle of

substantial transformation for goods

classified pursuant to GRI 2(a) and the

court’s decision in United States v.

Gibson-Thomsen Co., Inc., 27 CCPA

267, C.A.D. 98 (1940); on the other

hand, one of the commenters suggests

that origin would not necessarily be

determined under § 102.11(b) (on the

basis of essential character) if several

equally important parts are assembled.

Another commenter sought specific

clarification in connection with the

removal of § 102.16 as to whether the

country of origin of a single component

which has not undergone the applicable

change in tariff classification will

always be found to impart the ‘‘essential

character’’ to the product.

Customs Response: It is apparent that

these commenters have assumed that

interim § 102.16 had a much broader

application than it actually did. First,

§ 102.16, by its very terms, only applied

to goods which were assembled from

parts that were classified along with the

good in the same undivided heading or

in the same subheading. Second, even

when § 102.16 was applicable, the

country of origin of the good would not

always be determined under § 102.16. If

pursuant to this section Customs

concluded (as has happened in some

instances) that there was no substantial

transformation of the parts, then resort

must be had to the next step in the

hierarchy under § 102.11, that is,

paragraph (b) (or paragraph (c) if the

good is a ‘‘set’’). In other words, § 102.16

was only applicable within the context

of § 102.11(a)(3) and the specific tariff

rules of § 102.20. It did not have a life

of its own.

Customs also does not agree with the

other underlying premise of these

comments, i.e., that Customs is creating

the ‘‘essential character’’ standard. As

Customs thought had been made clear

in the SUPPLEMENTARY INFORMATION

portion of the May 5, 1995, notice,

whether or not there is a change in the

essential character of an article is the

principle factor considered by the courts

in determining whether there has been

a substantial transformation. In United

States v. Gibson-Thomsen Co., supra,

the court found that the marking statute

was not intended by the Congress to

have application to an imported article

further processed in the United States so

that it became a ‘‘new article having a

new name, character and use’’

(emphasis added).

Although the courts with customs

jurisdiction in more recent cases, and

Customs in its rulings, have often

characterized the standard as ‘‘new

name, character or use’’, the courts and

Customs have actually required a

change in the name, character and use

of an imported article for a finding of

substantial transformation into a new

and different article of commerce. In

addition, the courts have actually given

much less significance in recent cases to

the ‘‘name’’ and ‘‘use’’ of an article but

have emphasized the significance of a

change in its ‘‘character’’ in making

substantial transformation decisions.

See, e.g.: National Juice Products Assn.

v. United States, supra; Uniroyal, Inc. v.

United States, 542 F.Supp. 1026 (CIT

1982); and National Hand Tool Corp. v.

United States, 16 CIT 308, aff’d 989 F.2d

1201 (Fed. Cir. 1993). Therefore,

consistent with the courts’

interpretation of the substantial

transformation standard over recent

years, Customs has administered the

standard as originally enunciated by the

Gibson-Thomsen Co. decision as

requiring a change in the name,

character and use of the article and has

placed more emphasis on a change in

the character of the article than on any

change in its name or use. With regard

to one of the commenter’s suggestions of

using the NAFTA preference rules

incorporating a value-content

requirement, Customs notes that even

the Court of International Trade has

stated that ‘‘there is no reason to find

‘substantial transformation’ on the basis

of value added in the United States.’’

National Hand Tool Corp. v. United

States, supra.

As previously noted, the § 102.11

hierarchy does not stop at the failure of

the foreign materials to meet the specific

tariff rule of § 102.20. Therefore, one

commenter correctly observed that in

the case involving multiple parts that

are classified in the same undivided

heading or same subheading as the

finished good (e.g., multiple forgings for

a single hand tool), it is possible to

conclude that no single one of those

parts imparts the essential character to

the finished tool. (For purposes of this

determination under § 102.11(b),

materials which are classified at the

subheading level specified in the rule

under a general descriptive provision

(e.g. a ‘‘parts’’ provision) will be

considered, when distinct in style or

type, as separate materials, while

materials which are classified at the

specified subheading level under a

provision which reflects a more specific

description (e.g. ‘‘fresh cut flowers’’

under subheading 0603.10) will be

considered collectively as a ‘‘single

material’’.) If the good is not classified

as a ‘‘set’’, ‘‘mixture’’ or ‘‘composite

good’’, § 102.11(c) would not be

applicable and in such instance

§ 102.11(d) would be applicable. If the

production of the good from the parts

involved more than ‘‘simple assembly’’

or ‘‘minor processing’’, then it is

possible to conclude pursuant to

§ 102.11(d)(3), that the country of origin

of the good is the last country in which

the good underwent production.

In response to the question of

whether, if there is only one component

in a good which is classified in a

provision from which a change in tariff

classification is not allowed under the

§ 102.20 rule, that one component

always will determine the country of

origin, the answer is yes for the

following reason. The specific tariff

(tariff shift in most cases) rules were

developed with the specific view of not

allowing a change in tariff classification

from materials that can impart the

essential character to the good. In those

instances in which the tariff shift rule

excludes a particular tariff provision,

Customs has determined that the

processing required to shift from that

tariff provision to the provision for the

good is not, in itself, sufficient to result

in a change in the essential character of

the materials classified in the provision

from which a change is not allowed.

Therefore, unless the good is classified

as a set, if a good is made from a single

material that is classified in a tariff

provision from which a change is not

allowed, the single material will be

found under § 102.11(b) to impart the

essential character to the good, and the

country of origin of that material will be

the country of origin of the good under

Part 102.

As an example of the foregoing, a

forging for a flat wrench is imported

into the United States. The shape of the

flat wrench is defined by the forging

such that the two teeth of the open end

of the wrench are in place with just a

thin web of metal which must be

removed, and the closed end of the

wrench (a circle) also has a thin piece

of metal inside which must be removed,

and then heat treated, belt polished,

vibrated, acid cleaned, and chrome
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28939

plated. If the flat wrench forging is the

only material that does not meet the

tariff shift rule under § 102.20 as a result

of being classified in a provision from

which a change is not allowed (the

forging is usually classified in the same

provision as the finished wrench), this

is the single material that imparts the

essential character to the finished flat

wrench, and the country of origin of this

material is the country of origin of the

finished flat wrench. In order to clarify

this issue, § 102.18(b) has been modified

as set forth below to make it clear that

if there is only one component or

material that is classified in a provision

from which a change in tariff

classification is not allowed under the

§ 102.20 rule, that material will

constitute the single material that

imparts the essential character to the

good for purposes of determining

country of origin under § 102.11(b).

Section 102.18(a)—Rules of

Interpretation

Comments: One commenter states that

since § 102.18(a) only applies to rules

which contain an exception relating to

GRI 2(a) of the HTSUS, two questions

remain unanswered. First, how will the

origin differ when an unassembled

article is shipped with all of its parts in

one shipment, therefore invoking GRI

2(a), versus shipping parts separately

and thereby not triggering the

application of GRI 2(a)? Second, does

the assembly of the article under either

of the above scenarios determine the

country of origin of the assembled

article? If the answer to the second

question is yes, the commenter

questions whether this applies only

when the rule for the article does not

contain a GRI 2(a) exception.

Another commenter presents an

example of semi-knocked-down

(‘‘SKD’’) bicycles (classified under

heading 8712), which are complete

bicycles, individually boxed and ready

for sale to the ultimate purchaser which,

however, are not fully assembled (the

seat, seat post, front wheel [consisting of

a hub, spokes, nipples, rim, tire, inner

tube and rim strip], pedals, handlebars

and handlebar stem are not assembled

to the bike, but are simply placed

separately in the shipping carton in

order to reduce the size of the carton

thereby reducing freight costs). The SKD

bicycles are classifiable as complete

bicycles under GRI 2(a), and the

commenter seeks confirmation that as a

result of the applicability of § 102.18(a)

and the proposed new text of

§ 102.17(e), the assembly or collection of

the bicycles will not result in a tariff

shift.

Customs Response: The first

commenter correctly notes that

§ 102.18(a) is applicable only when

there is reference to GRI 2(a) in a

specific tariff rule under § 102.20,

which, in turn, only applies in the

context of determining origin under

§ 102.11(a)(3). Section 102.18(a)

operates just like the definitions in

§ 102.1: It cannot be invoked unless

specifically referenced in a rule. Thus,

the question of whether or not the

assembly of an unassembled good

confers origin cannot be answered in the

abstract. This determination will

depend upon the application of the

hierarchical rules of § 102.11 to the

specific goods and parts in question.

Customs also agrees with the

conclusions of the second commenter,

but probably for slightly different

reasons. The response below to the

example presented by the second

commenter illustrates how the GRI 2(a)

exception operates in the § 102.20 rules.

The § 102.20 specific tariff shift rule

for bicycles, which are classified in

heading 8712, HTSUS, is as follows:

8711–8713

A change to heading 8711 through 8713

from any other heading, including

another heading within that group,

except from heading 8714 when that

change is pursuant to General Rule of

Interpretation 2(a).

If the production of an SKD bicycle in

Country A entails the use of a

subassembly imported from Country B

that is classifiable under heading 8714,

HTSUS, § 102.18(a) is applicable and

the tariff shift from the subassembly

(classifiable under heading 8714) to the

SKD bicycle (classifiable under 8712

pursuant to GRI 2(a)) will not be

allowed.

Also, pursuant to the proposed new

text of § 102.17(e), a tariff shift would

not be allowed for collections of bicycle

parts or incomplete bicycle

‘‘subassemblies’’ which as collected are

classifiable in the same manner as the

complete bicycle, pursuant to GRI 2(a).

However, neither § 102.17(e) nor

§ 102.18(a) will be the reason that the

final assembly of the SKD bicycle into

the fully assembled bicycle does not

result in a tariff shift. In this instance,

the tariff shift does not occur simply

because the unassembled SKD bicycle

and the fully assembled bicycle are

classified in the same tariff provision.

Section 102.19—NAFTA Preference

Override

1. Section 102.19(a)

Comments: One commenter believes

that the application of this provision

can result in more than one NAFTA

country of origin. Another commenter

states that § 102.19(a) should be

applicable to goods the origin of which

is determined under § 102.21.

Customs Response: Customs disagrees

with the comment that this provision

can result in more than one country of

origin. In § 102.19(a), the word ‘‘single’’

before the words ‘‘NAFTA country’’

expressly makes clear that it is

impossible for originating goods that

meet the criteria of this provision to

have multiple countries of origin.

Customs has not been presented with a

scenario in which two parts of a good

were produced at the exact same time in

two NAFTA countries, which would be

the only circumstances in which there

can be two last NAFTA countries ‘‘in

which the good underwent production

other than minor processing’’.

Moreover, § 102.11(c) will never be

applicable to goods that meet the

criteria of § 102.19(a), since this

provision is triggered whenever a single

country of origin is not determined after

applying both § 102.11(a) and

§ 102.11(b).

Customs, however, agrees that

§ 102.21 should be included within the

scope of § 102.19(a). Paragraph (c) of

§ 102.21 (‘‘general rules’’) already

incorporates by reference all of the

additional requirements and conditions

of §§ 102.12 through 102.19.

Nevertheless, in order to make this

point even clearer, § 102.19(a) as set

forth below has been modified to

expressly refer to § 102.21 so that if a

good, which otherwise meets the

requirements of § 102.19, is not

determined under § 102.21 to have a

single NAFTA country, the country of

origin of such a good will be determined

under § 102.19.

2. Section 102.19(b)

Comments: Two commenters

requested clarification that this

provision does not apply for marking

purposes but rather applies solely for

customs duty purposes.

Customs Response: Customs agrees

that this provision does not apply for

country of origin marking. As stated in

the SUPPLEMENTARY INFORMATION portion

of the May 5, 1995, notice of proposed

rulemaking, the term ‘‘Customs duty

purposes’’ in § 102.19(b) is intended to

include merchandise processing fees.

This term, however, does not include

country of origin marking. Customs

believes, however, that the fact that the

provision clearly states it is applicable

for ‘‘Customs duty purposes’’ makes it

clear that the use of this provision for

any other purpose, such as for country

of origin marking, would be improper.
28940 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

Therefore, Customs believes that there is

no need to amend the provision.

Headings 0202, 0210 and 1602 (Meats)

Comments: One comment concerned

the fact that the specific tariff rules for

these goods do not allow some

operations, such as the grinding or

blending of imported beef with U.S. beef

to produce hamburger meat or patties, to

constitute an acceptable change in tariff

classification. This commenter also

believes that the USDA has the specific

statutory jurisdiction over the marking

of meat and poultry products whether

imported or domestic, pursuant to the

Federal Meat Inspection Act, 21 U.S.C.

601.

Customs Response: Customs

disagrees. Although Customs has not

issued a specific ruling regarding this

issue, it is Customs’ position that the

grinding or blending of foreign raw beef

with U.S. beef does not constitute a

substantial transformation. In other

cases concerning food, Customs has not

recognized merely blending or chopping

food, without cooking or other

preparation, to constitute a substantial

transformation. In this regard, it should

be noted that consistent with its

application of the substantial

transformation principle, the tariff shift

rules for prepared meat (heading 1601)

allow a change from any other chapter,

which will include the frozen, salted,

and dried meats of Chapter 2.

With regard to the country of origin

marking of imported meats, it suffices to

point out that 19 U.S.C. 1304, the

country of origin marking statute,

applies to all goods of foreign origin,

unless specifically exempt by statute or

by the specific regulations authorized by

the statute. This statute does not exempt

imported meat products from marking,

unless Customs determines that the

product is substantially transformed

into a new and different article by the

U.S. importer/processor. As stated

above, Customs does not view the mere

grinding of fresh meats into hamburger

as a substantial transformation;

therefore, Customs believes that,

notwithstanding any other domestic

laws that may be applicable for its

marking, such meats should be marked

as to country of origin prior to reaching

the ultimate purchaser thereof in the

United States. In connection with this

issue, it should be noted that Customs

has issued a General Notice regarding

the country of origin marking of beef

jerky. 26 Cust. Bull. And Decisions 51

(December 16, 1992). While Customs in

this General Notice recognized that

there may be conflicting country of

origin marking requirements imposed

by the USDA and Customs, Customs

nevertheless explained the legal basis

for the Customs marking determination

as well as the basis for Customs

jurisdiction in the matter.

Heading 0304 (Fish Fillets and Other

Fish Meat, Fresh, Chilled, or Frozen)

Comment: The specific rules for the

goods of this heading, except for fillets,

require a change to these goods from

any other chapter, while for fish fillets

the rules allow a change to this heading

from any other heading. One commenter

states that the rule should generally

allow a change to goods of this heading

from any other heading, citing the belief

that the production of fish meat requires

as much or more processing than the

production of fillets.

Customs Response: The commenter

has not provided, nor has Customs been

able to find, any evidence to

substantiate the claim that the

production of fish meat results in a

substantial transformation of the fish.

The Explanatory Notes to the

Harmonized System describe ‘‘other fish

meat’’ merely as fish meat from which

the bones have been removed, whereas

the production of fillets from fish

involves specific operations which have

been recognized by the Court of

International Trade as resulting in a

substantial transformation of the fish.

See Koru North America v. United

States, 701 F.Supp. 229 (CIT 1988),

discussed in the SUPPLEMENTARY

INFORMATION portion of the May 5, 1995,

notice of proposed rulemaking.

Heading 0710 (Vegetables, Uncooked,

Steamed, Boiled or Frozen)

Comments: Two comments were

received concerning this specific rule.

These commenters expressed concern

that the rule does not recognize a

substantial transformation resulting

from the processing performed to

produce mixtures of vegetables

classified in subheading 0710.90. One

commenter noted that in producing

their vegetable combinations, imported

vegetables are combined with domestic

vegetables in precise mixtures through

highly sophisticated proprietary

mathematical formulas, using state-ofthe-art weighing and mixing processes.

According to one commenter, the

combinations are the result of extensive

marketing and product research as well

as capital investment and technology to

appropriately provide for the blending

of the different vegetables. Therefore,

these commenters suggest that this

specific rule be amended to allow a

change to subheading 0710.90 (mixtures

of vegetables) from any other

subheading, provided that no single

vegetable ingredient of foreign origin

constitutes 75 percent or more of the

product by net weight.

Customs Response: Customs cannot

agree to this proposal. Customs

addressed the very facts presented by

these commenters in a ruling issued in

the year before the proposed rules were

published. In HQ 735085, dated June 4,

1993, the frozen vegetable products

were produced by combining foreign

broccoli, cauliflower, water chestnuts,

and peas with domestic carrots, yellow

peppers, and asparagus and then

packaging them for retail sale. Beyond

bagging, there was no processing of the

combined frozen vegetables, such as

cooking or adding sauces. Customs

found that the individual imported

vegetables retain their identities after

the combining operations.

Consequently, the vegetable mixtures

were not considered different kinds of

food articles, and imported vegetables

were not considered to have undergone

a substantial transformation. In HQ

735085, Customs distinguished prior

rulings such as HQ 555524, dated April

11, 1990, (which involved

manufacturing soup by mixing eleven

ingredients, boiling the mixture to

achieve desired consistency, and

packaging for retail sale). Customs still

adheres to the position expressed in HQ

735085 and for this reason does not

agree that the specific tariff rule for

vegetable mixtures classified in

subheading 0710.90 should be amended

as proposed by the commenters.

Headings 0904–0910 (Spices)

Comment: One comment was received

concerning the proposal to delete the

second tariff shift rule for headings

0904–0910, which provides for a change

to crushed, ground, or powdered

products of heading 0904 through 0910

from within Chapter 9, if put up for

retail sale. This commenter submits that

the cleaning (by gas treatment or

otherwise), crushing or grinding, and

retail packaging of spices substantially

transforms the imported whole spices

into new and different articles of

commerce having a new name, character

or use.

Customs Response: Customs agrees. In

view of the commenter’s analysis and in

light of the fact that Customs

Headquarters has never issued a binding

letter ruling with respect to the country

of origin marking of spices, Customs has

reconsidered the proposal to amend the

§ 102.20 rules for these goods and has

reverted to its original position,

published in T.D. 94–4 (59 FR 110) on

January 3, 1994. Accordingly, the May

5, 1995, proposal to delete the second

tariff shift rule set forth in § 102.20 for

goods of headings 0904–0910 should
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28941

not be adopted, and the interim tariff

shift rules as published in the January

3, 1994, document are reflected in this

final rule document.

Heading 1517 (Vegetable oil)

Comment: One comment was received

in connection with the rules for this

heading. The interim rules for this

heading provided for a tariff

classification change to subheading

1517.10 (margarine, excluding liquid

margarine) from any other heading and

a change to subheading 1517.90 (other

edible mixtures or preparations of

animal or vegetable fats) from any other

chapter. In consideration of an initial

comment, Customs proposed in the May

5, 1995, document to amend the rule for

subheading 1517.90 by adding an

alternative second tariff shift rule which

would allow a change from any other

heading so long as ‘‘no single oil

ingredient of foreign origin constitutes

more than 60 percent by volume of the

good’’. The commenter believes that the

processing and blending required to

create various blends and grades of a

type of oil (e.g. palm and sheanut oils)

requires rigorous quality control

procedures in order to achieve the

necessary physical characteristics and

thus should be considered a substantial

transformation whether or not the

resulting product contains more than 60

percent by volume from a single foreign

country.

Customs Response: Customs

disagrees. First, the tariff shift rule for

subheading 1517.90, as proposed to be

amended, is supported by the case law.

See National Juice Products Association

v. United States, supra, where the Court

of International Trade upheld Customs

determination that imported orange

juice concentrate is not substantially

transformed when mixed with water,

orange essences, orange oil and in some

cases fresh juice and either packaged in

cans and frozen or pasteurized, chilled

and packed in liquid form, and Coastal

States Marketing, Inc. v. United States,

646 F.Supp. 255 (CIT 1986), where the

court held that mixing Soviet Union gas

oil with Italian fuel oil in Italy did not

result in a substantial transformation

such that the mixture became a product

of Italy. In both of these cases, the court

concluded that the essential character of

the foreign component (juice

concentrate and Russian oil) remained

unchanged after the mixing process. The

proposed tariff shift rule which would

allow a change of origin if no single

foreign oil ingredient in the mixture

exceeds 60 percent of the mixture is

designed to ensure that there is a change

in the essential character of the foreign

vegetable oil. This proposed rule is

consistent with the proposed rule for

mixtures of juices (e.g., a mixture of

apple, grape, papaya juices), which is

based upon the conclusion that in such

mixtures, the individual fruit juices

would lose their separate identities and

thus there would be a change in the

name, character and use of the

individual juice ingredients. Thus, this

rule represents an effort to distinguish

between those blending operations

which generally do not result in a

substantial transformation and other

blending processes which can result in

a substantial transformation due to a

change in name, character, and use.

However, Customs believes that a

technical correction of the proposed

amendment to the § 102.20 rule for this

subheading is required, involving

expression of the 60 percent

requirement in terms of ‘‘weight’’, rather

than in terms of ‘‘volume’’, because the

unit of measure indicated in the HTSUS

for subheading 1517.90 is kilograms.

The second tariff shift rule for

subheading 1517.90 as set forth below

has been modified accordingly.

Chapter 20 Note

Comments: The Note for the Chapter

20 rules under § 102.20 provides that,

notwithstanding the specific rules of the

chapter, nuts of Chapter 20 that have

been prepared merely by roasting, either

dry or in oil (including processing

incidental to roasting), shall be treated

as a good of the country in which the

fresh good was produced. One

commenter submits that the roasting of

nuts should be considered a substantial

transformation. This commenter also

suggests that the mixing of nuts should

constitute a substantial transformation

since FDA regulations (21 CFR 164.110)

consider mixed nuts a standardized

food which, as such, must meet certain

formulation requirements.

Customs Response: Customs

disagrees. It has been the Customs

position for ten years that roasting, or

roasting and salting, or roasting and

salting and coloring, of pistachio nuts,

without more, does not result in a

substantial transformation. See T.D. 85–

158, dated October 15, 1985. Thus, the

Chapter Note is consistent with prior

Customs position and practice for these

goods. With regard to the mixing of

different nuts, Customs is not

persuaded, by the fact that the Food and

Drug Administration considers these

mixtures to be a standardized product,

that various types of nuts have been

substantially transformed as a result of

being combined with one another. The

same analogy could have been made

with regard to the orange juice

concentrate and retail juice beverages

involved in the National Juice Products

Ass’n., supra. Moreover, just as Customs

believes that the individual frozen

vegetables which are combined and

packaged for retail sale remain

separately identifiable (HQ 735085, June

4, 1993), Customs maintains that the

individual types of nuts that are

blended together after roasting and

salting do not lose their identities and

therefore are not substantially

transformed into new and different

articles of commerce, having a new

name, character, and use.

Subheadings 2009.11–2009.30 (Fruit

and Vegetable Juices)

Comment: One comment was received

concerning this tariff shift rule. This

commenter suggested that this rule,

which allows a change to these

subheadings from any other chapter, be

amended to preclude a change from

heading 0805 (fresh or dried citrus

fruit). The commenter points out that

this change would make these rules

consistent with the NAFTA preference

rules for these goods.

Customs Response: Customs cannot

agree. First, it should be pointed out

that the purpose for development of

these rules is not to provide origin

determinations that are necessarily

consistent with the NAFTA preference

rules (19 U.S.C. 3332). Instead, Customs’

goal has been to develop rules that

would codify the substantial

transformation principle as interpreted

by the courts and Customs. Customs

recognizes that the NAFTA preference

rules are not always consistent with the

origin determinations reached under the

substantial transformation principle. As

a result sometimes the part 102 rules

will be less restrictive and in some cases

they may appear to be more restrictive.

The part 102 rules are less restrictive

than the NAFTA preference rules for

goods of subheading 2009.11 through

2009.30 because Customs has

consistently recognized the production

of fruit juices from the fresh fruit as a

substantial transformation of the fresh

fruit into a new and different article of

commerce. See HQ 555982 dated

August 1991 (substantial transformation

of grapefruit and oranges made into

juice concentrate) and HQ 084346 dated

August 8, 1989 (substantial

transformation of cranberries made into

juice concentrate).

Subheading 2101.10 (Extracts, Essences

and Concentrates of Coffees)

Comments: Three comments were

received concerning the § 102.20 tariff

shift rule for heading 2101, which

requires a change to heading 2101

(extracts, essences, and concentrates of
28942 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

coffee, etc.) from any other heading.

These commenters submit that the rule

should be amended to allow a change to

subheading 2101.10.21 (extracts,

essences, and concentrates of coffee)

from elsewhere within heading 2101

since they believe that a change from

‘‘soluble coffee powder’’ to ‘‘retail

instant coffee products’’ should be

recognized as a substantial

transformation. They cite as support for

their position the argument that bulk

soluble powder is not purchased by

consumers but by coffee manufacturers

and is used in non-coffee products such

as ice cream as well as in coffee

products. They further submit that the

use of expensive machinery and the

employment of experts and technicallyskilled persons are necessary in order to

blend, agglomerate, aromatize (often the

flavoring and aromas are proprietary)

and eventually package the product for

retail sale. They claim that the cost of

such processing runs about 120 percent

of the cost of the soluble powder.

Customs Response: Customs does not

agree that the operations described

above result in a substantial

transformation of water soluble coffee

powders (known technically in the trade

as spray-dried coffees). Customs

addressed this issue in a ruling as early

as 1986 (HQ 727913 dated February 5,

1986). In that case, the agglomerated

coffee was produced in Canada as a

result of blending and agglomeration of

various Latin American spray dried

coffees. Customs found that the

agglomerated coffee imported into the

United States from Canada had to be

marked to indicate the individual Latin

American countries.

Customs most recently addressed this

issue in HQ 734479 issued on January

29, 1993. Customs still does not believe

that the blending and agglomeration of

spray dried coffees from different

countries result in a new and different

article of commerce, having a new

name, character and use. The facts

presented in the 1993 ruling concerned

the processing of the various Latin

American blends of spray dried coffees

in a European Community (EC) country,

which at that time was subject to the

100 percent special duty rates

applicable to these products from the

EC. After reviewing the technical

literature regarding the processes,

Customs concluded that blending and

agglomerating spray dried coffee

constituted refining and finishing

operations which did not change the

fundamental character or use of the

spray dried coffee. Customs further

concluded, consistent with prior

rulings, that the agglomerated coffee,

while an improved product, remained

instant coffee after the processing, and

therefore, was not considered an EC

product but a product of the various

Latin American countries from which

the coffee originated. As one requester

of a marking ruling issued in 1991

pointed out, the ‘‘spray-dried powder is

a finished form of coffee that can be

dissolved in hot water to produce a

tasteful cup of coffee.’’ Customs believes

that such a statement is testament to the

absence of a substantial transformation

when the coffee powders are subjected

to the agglomeration process.

Heading 2710 (Petroleum Products)

Comment: One comment was received

concerning the tariff shift rules for this

heading, which allow a change to the

heading from any other heading or a

change to goods of the heading from

other goods of that heading if the change

resulted from a chemical reaction

(defined in the Chapter 27 Note). The

commenter suggests that the tariff shift

criteria applicable to heading 2710

should be expanded to include a change

within heading 2710 from motor fuel

blending stocks to motor fuel. The

commenter argues that finished gasoline

differs from each of the blending stocks

in name, character and use. Thus, under

the traditional change in name,

character and use test, the commenter

submits that the blending of the various

stocks to produce gasoline constitutes a

substantial transformation.

Customs Response: Customs

disagrees. The specific rules for heading

2710 codify prior Customs rulings

regarding the country of origin of

various petroleum products. For

example, in HQ 555032 dated

September 23, 1988, and HQ 557180

dated December 23, 1993, Customs

addressed the issue of whether certain

petroleum products, such as gasoline

and diesel fuel, produced in the U.S.

Virgin Islands qualify for duty-free

treatment under General Note 3(a)(iv),

HTSUS (the duty-free program for

products of U.S. insular possessions).

Customs determined that one or more

substantial transformations occurred

when crude oil imported into the Virgin

Islands was subjected to refining and

other processes, resulting in chemical

reactions and the creation of various

motor fuel blending stocks and other

motor fuel components. Thus, it was

determined in the above rulings that the

petroleum products qualifed as

‘‘products of’’ the insular possession.

While Customs also held in HQ 555032

and HQ 557180 that the subsequent

blending of the blending stocks and

other motor fuel components in the

Virgin Islands to create the final

petroleum products resulted in a

substantial transformation, this portion

of these rulings was not an origin

determination but rather pertained

solely to the issue of whether the

imported crude oil could be considered

a domestic material for purposes of the

foreign material value limitation of

General Note 3(a)(iv), HTSUS.

Therefore, the § 102.20 rules, which

provide for a change to heading 2710

from any other heading (e.g., crude

petroleum of heading 2709) or a change

to any good of heading 2710 from any

other good of heading 2710, provided

the change is the result of a chemical

reaction (e.g., alkylate produced from a

chemical reaction affecting a heading

2710 good), are consistent with Customs

country of origin rulings on these

products. However, as Customs

previously has stated, the Part 102 rules

will not be applicable for determining

the value content requirements under

duty preference programs.

Subheading 2936.90 (Vitamins)

Comment: One comment was received

concerning the specific tariff rule for

these goods. This commenter suggested

that the rule, which provides for a

change to this subheading from any

other subheading except from

subheadings 2936.10 through 2936.29,

should be less restrictive. This

commenter believes that changes from

the other vitamin provisions in this

heading should be allowed.

Customs Response: Customs

disagrees. Consistent with Customs’

interpretation of the substantial

transformation standard, this rule is

designed to keep simple blending of

different vitamins, which after such

blending remain classified in this

heading, from being considered a

substantial transformation. Customs

believes that no degree of blending can

substantially transform foreign

constituent vitamin components into a

product of the country in which the

blending occurs. The Customs position

on this matter is consistent with the

position regarding similar processing of

other chemical products, such as

pharmaceuticals and herbicides. See the

analysis of comments below in

connection with these products.

Chapter 30 (Pharmaceuticals)

Comments: Six comments were filed

in response to the interim and proposed

§ 102.20 rules applicable to

pharmaceuticals of Chapter 30. These

rules, for the most part, allow a change

to the subheadings of this chapter,

which consist of prepared

pharmaceuticals, from any other

subheading except from the bulk

pharmaceuticals of Chapter 29 or other
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28943

provisions. The commenters essentially

claim that the formulation of dosage

form pharmaceuticals is a substantial

transformation of the bulk

pharmaceuticals of Chapter 29. They

claim that the Chapter 29

pharmaceuticals are unsuitable for

therapeutic or prophylactic use. In order

to be usable, the commenters state that

the pharmaceuticals must be worked up

to particular dosage forms which

involves numerous complex

intermediate steps ranging from exact

weighing to final presentation in tablets,

capsules, injections or ointments and

which adds more than 50 percent to the

value of the product. In this regard one

commenter argues that for a gastric acid

secretion pharmaceutical, a substantial

transformation occurs when a special

coating is given to the medicine so that

it can pass through the stomach intact

for release in the intestines. Finally,

some commenters claim that the ‘‘40

percent’’ criterion that is contained in

the specific rules for blends of

pharmaceuticals, is inconsistent with

current practice. Under these rules, if a

mixture or blend of bulk

pharmaceuticals, classified in this

chapter, contains at least 40 percent

domestic content of the bulk

pharmaceutical, the specific tariff rule

of § 102.20 would be met.

Customs Response: Customs disagrees

with these comments. Customs believes

that the § 102.20 rules properly reflect

Customs’ current position regarding the

substantial transformation of bulk

pharmaceuticals. It is Customs’ view as

reflected most recently in 1993 (HQ

735146 issued on November 15, 1993 )

that the bulk (pure) active

pharmaceutical ingredient which is

reduced in potency by dilution with

other inert ingredients, such as starch

and other excipient, is not substantially

transformed into a new and different

article having a new name, character

and use. The essential character of these

products, both chemically and

functionally, remains the same after the

processes performed to make them

readily consumable. For example, when

Customs concluded in the 1993 ruling

that the processing of 100 percent pure

acetaminophen, through granulation

and addition of excipient to make a 90

percent pure product that is then used

to make tablets, was not a substantial

transformation, Customs took note of

the following: (1) Like most

pharmaceutical products, the ‘‘name’’ of

the product did not change from the

bulk pharmaceutical to the finished

product (the product was still referred

to as ‘‘acetaminophen’’); (2) the ‘‘use’’

did not change, since both the original

and finished products were used for

medicinal purposes (while the

metabolic activity of the drug is

standardized as a result of a controlled

dilution, it is not changed); and (3)

finally, the essential character of the

product as a medicine did not change

even after processing into tablets. The

essence of the pharmaceutical

ingredient had not changed

fundamentally. Indeed, regardless of the

commercial brand under which it is

marketed, the product being purchased

to provide pain relief is the drug,

acetaminophen. Similar rulings were

issued previously in 1979 (HQ 005716

dated July 12, 1979, C.S.D. 80–34, with

regard to the granulation and dilution of

Naproxin with starch) and in 1986 (HQ

554067 dated May 23, 1986, with regard

to oxfendazole, a veterinary drug, which

was micropulverized and packaged into

dosages fit for veterinary use). Thus, in

response to the comment concerning

encapsulation, Customs believes that

this process does not alter the

fundamental nature of the

pharmaceutical. Although it helps to

deliver the product, the pharmaceutical

still has the same activity.

In response to the comments claiming

that significant value is added as a

result of the processing of the bulk

pharmaceuticals, Customs finds relevant

the fact that the Court of International

Trade has held that in determining the

issue of substantial transformation, the

‘‘name, character, or use’’ test should be

sufficient since the use of a value

criteria can lead to anomalous results.

National Hand Tool v. U.S., supra. In

any case, however, Customs believes

that in regard to the total production of

pharmaceuticals classified in Chapter

30, the predominate costs are incurred

in the production of the bulk

pharmaceutical drugs classified in

Chapter 29 and other chapters under the

HTSUS. In most instances, costs of end

processing of the pharmaceutical drug

are inconsequential when compared to

the enormous costs involved in the

multi-stage chemical reactions and

separations and the years of research

needed to develop and produce the bulk

pharmaceutical.

Finally, Customs also disagrees with

the commenters’ objections to the ‘‘40

percent’’ criterion in the tariff shift rules

for pharmaceuticals mixtures. Under

this rule, a change of origin can occur

as a result of blending different

imported bulk pharmaceuticals with

domestic pharmaceuticals if the

finished product (i.e., the Chapter 30

product) contains at least 40 percent, by

weight, of domestic bulk

pharmaceutical. Customs finds this rule

to be entirely consistent with, if not

more liberal than, Customs’ current

practice of applying the substantial

transformation principle to blending

operations involving chemical products.

Generally, the simple blending together

of chemicals, which does not result in

a chemical reaction that creates a new

chemical has not been recognized as a

substantial transformation. However, if

one or more of the chemical ingredients

was produced in the country where the

blending occurs, Customs would not

view the production of the mixture as

resulting solely from a simple

combining or blending operation. See,

e.g., 19 CFR 10.195(a)(2). Customs,

however, does not always find a

substantial transformation in cases in

which there is more than a simple

blending. The ‘‘40 percent’’ rule,

however, codifies the position that

when the blending operation involves as

least 40 percent domestic origin bulk

pharmaceutical, it will not be

considered a simple blending and will

always be sufficient to confer origin.

Headings 3302 Through 3303

(Perfumes)

Comment: One comment was received

concerning the § 102.20 rules for these

goods. The first of the two rules

disallows a change to heading 3302

(mixtures of odiferous substances that

are ‘‘of a kind used as raw materials in

industry’’) from essential oils of heading

3301 and from ethyl alcohols of

headings 2207 and 2208. The rule for

perfumes and toilet waters (heading

3303) disallows a change from the

perfume oil mixtures and blends of

subheading 3302.90. The commenter

objects to the above rules, claiming that

they are too restrictive.

Customs Response: Customs

disagrees. The commenters fail to note

that the rules do allow a change from

the essential oils of heading 3301 to the

perfumes and toilet waters of heading

3303, which is consistent with Customs’

application of the substantial

transformation principle to these goods.

In HQ 723312 dated November 22, 1983

(cited with approval in HQ 733945

dated March 26, 1991), Customs ruled

that the production of perfumes as a

result of blending foreign essential oil

with U.S. origin denatured alcohol,

stabilizer, coloring matter and water

resulted in a substantial transformation

of the foreign essential oil. The § 102.20

rule for perfumes goes even further by

allowing the denatured alcohols

included in the blend to be foreign as

well. Thus, it appears that the

commenter’s objection is to the fact that

the rules do not allow a simple dilution

of perfume bases (a change from

subheading 3302.90 to heading 3303) or
28944 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

a simple blending of essential oils and

alcohols (a change from heading 3301,

2207 or 2208 to heading 3302). Customs

believes that a simple dilution or

blending of these goods does not

represent a substantial transformation

into a new and different article of

commerce. However, Customs believes

that when the raw materials of headings

3301, 2207 and 2208 are processed to

make a finished product such as

perfumes or toilet water, they have been

substantially transformed, and, as stated

above, the § 102.20 rule codifies this

position.

Subheading 3402.11 (Linear

Alkylbenzene Sulfonates)

Comment: Two comments were

received concerning the § 102.20 rule

for these goods which provides: ‘‘A

change to subheading 3402.11 through

3402.20 from any other subheading,

including another subheading within

the group.’’ Although both commenters

support Customs’ efforts toward greater

objectivity and predictability in origin

determinations, they suggest that a

change from subheading 3817.10 to

subheading 3402.11 should not be

allowed since such a change can result

from a very simple process which does

not result in a substantial

transformation.

Customs Response: Customs agrees

that the described change should not be

recognized as constituting a substantial

transformation. The process normally

involves in part the segregation of the

individual linear alkylbenzene

components from mixed linear

alkylbenzenes classified in subheading

3817.10. However, in § 102.20, Note 2 to

the Section VI (Chapters 28 through 38)

tariff shift rules sets forth a ‘‘Separation

Prohibition’’ provision which expressly

precludes ‘‘a change from one

classification to another merely as the

result of the separation of one or more

individual materials or components

from a man-made mixture unless the

isolated material/component, itself, also

underwent a chemical reaction.’’

Therefore, Customs believes that the

concerns raised by the commenters will

be resolved by this note. However, in

order to clarify this issue, the § 102.20

rule for subheading 3402.11 has been

modified to make clear that a substantial

transformation does not result from a

change from mixed linear alkylbenzenes

of subheading 3817.10.

Headings 3701–3703 (Photographic

Film)

Comments: Two comments were

received concerning these rules. One of

these comments focused primarily on

the general result of operating under

§ 102.14 (U.S. goods returned) and thus

is no longer relevant in light of the

adoption of the proposal to remove this

section as discussed above. The other

commenter claims that the § 102.20

rules should allow a change in tariff

classification from jumbo rolls of film

classified in subheading 3702.41 to the

smaller sized film cartridges classified

in subheading 3702.51 and subheading

3702.41 so as to be consistent with the

substantial transformation principle.

Customs Response: Customs

disagrees. The rules for these goods

require a change to headings 3701

though 3703 from headings outside that

group. It has been a longstanding

position of Customs that cutting to

length and width does not result in a

substantial transformation of the article

subjected to such processing. Customs

specifically addressed this issue in

connection with the production of

photographic film cartridges in HQ

732842 dated February 23, 1990. In HQ

732842, the foreign material consisted of

sheets of photographic film in rolls

measuring 58 inches wide and 9,500

feet long, which were subjected to

processes consisting of applying a nonphotosensitive emulsion coating, cutting

the bulk photographic film to length and

width, inserting them into cassettes, and

then placing the cassettes into plastic

sealed containers and cartons for retail

sale. The imported film base in HQ

732842 already had been ‘‘sensitized’’,

i.e., it already had been subjected to an

application of photosensitive emulsion.

(This is the process which, in ORR 217–

69 dated March 28, 1969, Customs had

ruled resulted in a substantial

transformation of the film base into

photographic film, a new article with

new physical characteristics (light

sensitivity and ability to form an image

from which a positive can be made) and

new uses different from the base from

which it was made.) Thus, Customs

concluded in HQ 732842 that the

processes to which the alreadysensitized photographic film was further

subjected (e.g., cutting to length and

width, inserting into cartridges, and

packaging) did not result in a new and

different article with new name,

character and use.

Customs believes that the positions

expressed in the above rulings properly

interpreted the substantial

transformation standard, and the

§ 102.20 rules for these goods are

entirely consistent with these rulings.

The rules allow a change from headings

3701 through heading 3703 from

headings outside the group. This would

allow changes from the unsensitized

film base (plastic or paper provisions

outside of Chapter 37), consistent with

ORR Ruling 217–69. Moreover, the rules

do not allow a change from one size of

sensitized film to another when the

difference in sizes is in terms of length

and width.

Subheadings 3808.10 and 3808.20–

3808.90 (Pesticides, Herbicides and

Fungicides)

Comments: Three comments were

received. These commenters object to

the proposed tariff shift rules for

subheadings 3808.10 and 3808.20–

3808.90 that do not allow a change in

origin for bulk insecticides, fungicides,

herbicides, rodenticides or pesticides of

Chapter 28 or 29 that are converted to

Chapter 38 products. One commenter

agrees that if the conversion only

represents mere dilution, there is no

change in origin; however, it is

suggested that § 102.17 of the interim

regulations disqualifies operations

involving the mere dilution with water

or another substance. Rather, it is stated

that some conversion processes are

more than ‘‘mere dilution’’, such as

where an active ingredient is converted

to a finished product by formulation

and granulation. During formulation,

the ingredient is blended with selected

inert ingredients and milled. Although

the inert ingredients do not chemically

react with the active ingredient, it is

stated that they do provide a specific

functionality as dispersants, wetting

agents, defoamers, buffers, binder,

diluents, etc. Following the formation

process, the material undergoes

granulation which is an agglomeration

process designed to produce product

granules of specified size and

characteristics.

One commenter asserts that Customs

ignores sophisticated manufacturing

procedures such as the conversion of

bulk Flumetron into the finished

products ‘‘Cotoran 4L’’ and ‘‘Cotoran

DF’’. ‘‘Cotoran 4L’’ is manufactured by

grinding Flumetron and dispersing the

ground product in liquid. ‘‘Cotoran DF’’

is a dry herbicide produced by blending

Flumetron with inert materials (form of

dilution) which is then granulated into

the finished product. Another

commenter suggests that origin should

be conferred by processes such as

chemical transformation, physical

processing that would place an

herbicide into a substrate or medium,

and physical processing which modifies

a quality.

Customs Response:

Customs disagrees. These rules are

consistent with Customs’ practice and

interpretation of the substantial

transformation principle. In HQ 555064

dated March 29, 1990, Customs

determined that the formulation of
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28945

propanil-4, a herbicide for rice, from

technical propanil did not constitute a

substantial transformation for purposes

of the Caribbean Basin Economic

Recovery Act. This decision was based

on T.D. 78–168, 12 Cust. Bull. 353

(1978), which held that the formulation

of the herbicide diuron wettable powder

by mixing technical diuron with various

agents was not a substantial

transformation for purposes of the

Generalized System of Preferences.

These findings are also consistent with

National Juice Products Association v.

United States, supra, where the court

found that imported manufacturing

orange juice concentrate was the very

essence of frozen concentrated orange

juice and reconstituted orange juice.

The court noted that the addition of

water, orange essence and oils to the

concentrate, while making it suitable for

retail sale, did not change the

fundamental character of the imported

product and, therefore, was not a

substantial transformation.

While Customs does not dispute the

importance to the end user of placing

herbicides, such as Flumetron, into its

final dilute wettable form, it is the

opinion of Customs that these final

steps simply place the herbicide in an

applicable form without changing its

function or chemical structure.

Additionally, because the bulk product

is more compact than the finished

product, it is economically feasible to

trade the bulk form (‘‘Flumetron’’) of the

herbicide rather than the final dilute

wettable or liquid forms of the herbicide

(‘‘Cotoran’’). It is also the opinion of

Customs that these tail-end procedures

are far less important when compared to

the production of the bulk herbicide.

The manufacture of the bulk herbicide

is a complicated multi-step organic

synthesis which takes place in a

petrochemical facility. This process

normally follows a significant number

of years and amount of resources

committed to the research and

development of the bulk herbicide.

Thus, in addition to the fact that the

process of mixing the bulk herbicide

with inert materials or with a wetting

agent to place it in an end use form does

not change the essential character of the

herbicide, this process, when compared

to the manufacture, research, and testing

of the bulk herbicide, involves

significantly less economic outlay.

Therefore, it is the opinion of Customs

that the processing of bulk herbicides

into dilute wettable form herbicides

does not substantially transform the

bulk herbicides.

Headings 4104–4107 (Leather)

Comment: One comment was received

concerning the May 5, 1995, proposal to

amend the § 102.20 interim rule for

headings 4104 through 4107 to disallow

a change from ‘‘wet blues’’ leather to

‘‘finished leather’’. This commenter

supported the proposed amendment on

the grounds that processing raw hides to

wet blues leather is sufficient to confer

origin and that additional processing to

make wet blues into finished leather

constitutes finishing operations which

are insufficient to change the country of

origin of the leather.

Customs Response: Customs agrees

with the comment. For the above

reasons and the reasons cited in the May

5, 1995, notice, the proposed rule for

goods of heading 4104 through 4107 is

reflected in § 102.20 as set forth below.

Headings 6401–6405 (Complete

Footwear)

Comment: The interim § 102.20 rule

for the above goods provides for a

change to headings 6401 through 6405

from any heading outside the group,

except from formed uppers. One

comment was received concerning this

rule. This commenter noted, and

expressed approval for, the fact that the

above rule is consistent with Customs

longstanding application of the

substantial transformation principle to

footwear.

Customs Response: Customs agrees

that the § 102.20 rule for these goods is

consistent with its interpretation of the

substantial transformation principle. It

should be noted that Customs’ practice

in this area is also in direct compliance

with the decision in Uniroyal, Inc. v.

United States, supra, where the court

held that footwear uppers which were

‘‘lasted’’ or permanently molded into

the ultimate shape, form, and size of the

complete shoe, were not substantially

transformed by the attachment thereto

of an outsole since the upper was the

very ‘‘essence’’ of the finished shoe.

Therefore, with the exception of

footwear with uppers and soles made of

wool felt (which are covered by new

§ 102.21—see the above discussion

regarding rules of origin for textile and

apparel products), the § 102.20 rule for

goods of headings 6401 through 6405 is

set forth below without substantive

change.

Headings 7010–7018 (Glass Articles)

Comments: Only one comment was

received in response to the May 5, 1995,

proposal to amend several of the

§ 102.20 rules for goods of the above

headings. This comment expressed

support for the proposed amendment to

the § 102.20 rules applicable to

decorative crystal, which will now

recognize certain prescribed operations

performed on uncut and unpolished

glassware blanks as resulting in a

change of origin of the glass blanks.

Customs Response: For the reasons

stated in the background discussion for

the proposed amendments, as well as

the reasons cited elsewhere in this

document for general changes affecting

these rules, and in consideration of the

comment received, the proposed

changes to the § 102.20 rules for goods

of headings 7010 through 7018, are

adopted and set forth below without

substantive change.

Chapter 72 Note (Cold Rolled, Flat

Rolled Steel)

Comments: Three comments were

received in response to the July 12,

1995, proposal to amend the § 102.20

rules for Chapter 72 goods by adding a

note that allowed cold rolled, flat rolled

steel, which is produced by reduction of

hot rolled flat rolled steel, to be treated

as a good of the country in which the

cold reduction occurred. Two

commenters supported the note as

proposed. One of these commenters

stated that the proposed note was

consistent with Customs’ longstanding

position that these cold rolled flat rolled

products are substantially transformed

in the country where cold reduction

took place. The second of these

commenters noted its support for all of

the Chapter 72 and 73 rules, citing its

belief that these rules are more

transparent and predictable for

determining country of origin. The third

commenter supported the principle

reflected in the proposed Chapter 72

note but also suggested that the scope

should not be limited to flat rolled

products but rather should include

other products such as pipe that are

subjected to a cold reduction process.

This commenter stated that the rationale

for the Chapter 72 note, i.e., that there

is a significant reduction in the

thickness of hot rolled, flat rolled,

product which changes the crystalline

structure of the steel products by

elongating it, applies to hot extruded

tubular products which are subjected to

a cold reduction process.

Customs Response: Customs does not

agree with the comment suggesting that

the proposed note be amended to cover

additional products. Customs believes

that the cold reduction of hot rolled flat

rolled steel results in a substantial

transformation of the hot rolled flat

rolled steel not only because there has

been reduction in size but also because

of the changes in use caused by this

process.
28946 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

Unlike the circumstances relating to

the hot extrusions (hollows) and wire

rod, Customs finds that the hot rolled

flat rolled steel product is not

necessarily dedicated to becoming cold

rolled flat rolled steel. The cold

reduction process results in changing a

product (hot rolled steel) which has

versatile uses to one that has limited

uses. For example, in HQ 080277 dated

September 21, 1987, in which Customs

ruled that hot rolled steel coil was

substantially transformed when made

into cold rolled full hard steel coil as

result of a cold reduction process,

Customs noted the fact that each of the

two products was marketable to a

distinct consumer group and that thin

gauge hot rolled coil generally could be

substituted for cold rolled full hard steel

coil in commercial applications. Thus,

hot rolled flat rolled steel is not

dedicated to become cold rolled flat

rolled steel before it can be used for any

intended purpose. For example, hot

rolled, flat rolled steel can be used as

steel planks, ship hulls and similar

products, or it can be cold rolled into

steel sheeting having specific uses (e.g.,

automobile steel). For reasons explained

more fully below, Customs does not

agree that the same rationale applies to

wire and tube products.

Heading 7210 (Flat Rolled Steel, Coated,

Clad or Plated)

Comment: One comment was received

regarding the § 102.20 rule for heading

7210 (flat-rolled iron or steel of 600 mm

or more, coated, clad, or plated), under

which a change from headings 7208

through 7212 is not allowed. This

commenter proposes that origin be

conferred when flat-rolled steel of

heading 7209 is coated, clad, or plated.

Customs Response: Customs

disagrees. Consistent with the rationale

set forth in the Superior Wire case

discussed in the response to the next

comment, it is the position of Customs

that a substantial transformation does

not occur through the coating, cladding

or plating of flat-rolled steel. It is

Customs’ view that the use and

character of such products are

predetermined by the imported steel,

and that coating, cladding, and plating

merely constitute finishing steps in the

completion of the product.

Headings 7217 and 7223 (Wire)

Comments: Four comments pertain to

the processing of wire rod into wire.

Under the § 102.20 rules, a change is not

allowed to heading 7217 (wire of iron or

non-alloy steel) from headings 7213

through 7215 (bars and rods of iron or

non-alloy steel); nor is a change allowed

to heading 7223 (wire of stainless steel)

from heading 7221 or 7222 (bars and

rods of stainless steel).

Each of the four commenters believes

that a change should be allowed when

wire rod is converted to wire under

certain circumstances. One commenter

believes that the rule should take into

account the heat treatment (annealing)

involved in treating stainless steel rod;

another commenter is of the opinion

that drawing and annealing the rod

should confer origin if at least a

minimum reduction of 75 percent in

surface area occurs; and a third

commenter proposes that origin be

conferred when the conversion of wire

rod to wire includes the process of

galvanizing. The fourth commenter

believes that a change should be

allowed to heading 7217 from headings

7213 through 7215 if there is either a

substantial transformation or a regional

value content of not less than 50 percent

of the net cost of the good. A change

would not be allowed if the carbon

content of the wire rod is less than a

certain minimum, the reduction in

cross-sectional area is less than 75

percent, and the wire is not further

processed by heat treatment or coating.

Customs Response: In Superior Wire

v. United States, 11 CIT 608, 669 F.

Supp. 472 (CIT 1987), aff’d, 867 F.2d

1409 (Fed. Cir. 1989), the Court of

International Trade held that the

drawing of wire rod into wire through

a multi-stage process did not constitute

a substantial transformation of the wire

rod, since there was no significant

change in use or character of the

imported material. The court noted that

while the wire emerged stronger and

more rounded after drawing the wire

rod, its strength characteristic was

metallurgically predetermined, and the

chemical content of the rod and the

processes used in its manufacture

determined the properties the wire

would have after drawing. Thus, while

the wire rod and wire had different

names and identities in the industry, the

court found that they were essentially

different stages of the same product.

The § 102.20 rules codify the court’s

decision in Superior Wire that a

substantial transformation does not

occur when wire rod is converted to

wire. While the record in Superior Wire

does not indicate whether annealing

also took place, Customs notes that the

most significant operation involved in

transforming wire rod to wire is the

drawing process, which reduces the rod

in cross-sectional area. It is Customs

opinion, based on the rationale of

Superior Wire, that heat treatment

(annealing) and/or galvanizing (which

may be performed subsequent to the

drawing process) do not change the use

or character of the wire, which is

predetermined by the wire rod. These

processes are merely finishing steps in

the processing of the wire rod to wire.

With regard to the fourth commenter’s

suggestion of the use of a value added

criterion, the Customs responses to

previous comments in this document

(e.g. § 102.16, § 102.20

(pharmaceuticals)) are hereby

incorporated by reference.

Subheading 7304.41 (Pipes and Tubes)

Comments: Two comments were

received regarding the § 102.20 rule

applicable to seamless tubing and pipe

classifiable under subheading 7304.41,

HTSUS. The rule for these goods

provides for a change to heading 7301

through 7307 from any other heading,

including another heading within that

group. The two commenters oppose this

§ 102.20 rule. One commenter states that

these products are produced by cold

working processes performed on thickwalled hot extrusions known as

hollows. The hollows are subjected to a

cold-working process known as

‘‘pilgering’’ which employs matched

pairs of rotating dies in conjunction

with a mandrel to reduce the diameter

and wall thickness. Drawbenches,

another cold-working process, is also

used in conjunction with pilgering

equipment to produce the smallest-sized

product range. Other processes,

including degreasing, heat treating,

straightening, cutting, deburring, and

polishing, are also performed. The

commenters claim that these processes

performed on hollows to produce

stainless steel pipe and tube in sizes

ranging from 1⁄4 inch up to 11⁄2 inch in

outside diameter result in a substantial

transformation of the hollows.

Customs Response: Customs

disagrees. Customs has found the

decision in Superior Wire v. United

States, supra, supportive of the

conclusion that tube hollows cold

drawn to smaller sizes are not

substantially transformed. See HQ

558825 dated February 9, 1995, and HQ

556932 dated January 14, 1993. In HQ

556932, only a seven-step process

performed on imported steel rod,

consisting of pickling, drawing,

threading, die-forming, threading of

bolts and tapping of nuts, heat

treatment, and in some cases, plating,

collectively constituted a single

substantial transformation. Accordingly,

Customs disagrees that the § 102.20 rule,

which disallows a change in origin for

hollows subjected to pilgering, are

inconsistent with the court’s application

of the substantial transformation test to

similar merchandise, e.g., wire rod to

wire. To the extent that there may be
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28947

rulings which indicate that similar

processes resulted in a substantial

transformation, these rulings were

issued prior to the decision in Superior

Wire.

Subheadings 8470.10–8471.91

(Calculating, ADP Machines

(Computers))

A. Comments on Computers in General

For those § 102.20 rules for goods of

Chapters 84 and 85, which generally

disallowed tariff changes resulting from

a ‘‘simple assembly’’, Customs proposed

revisions which clarified that only those

changes from specifically identified

tariff provisions will be disallowed

when the production of the good

resulted from a ‘‘simple assembly’’ as

defined under § 102.1(o). Only those

provisions from which a change in tariff

classification indeed can result from

simple assembly are now included in

the ‘‘simple assembly’’ provisos in these

tariff shift rules. Thus, the proposed

rules for subheadings 8470.10 through

8471.91 (which covers ADP machines)

was proposed to be revised to read as

follows:

A change to subheading 8470.10 through

8471.91 from any subheading outside that

group, except from heading 8473; or A

change to subheading 8470.10 through

8471.91 from any subheading within that

group or from heading 8473, provided the

change is not the result of a simple assembly.

Three comments were received

concerning the § 102.20 rules applicable

to the production of computers from

foreign materials. One commenter

claims that, since a change in tariff

classification occurs when a CPU chip

is mounted onto a stuffed printed circuit

board, a change of origin should also

occur as a result of this operation.

Another commenter states its belief that

in order to determine the origin of a

computer not wholly obtained in a

country, one must identify the country

in which an identically classified PCA

(printed circuit assembly) underwent a

prescribed change in classification and

then assign that origin to the entire

computer. Finally, the third commenter

complained that under the § 102.20

rules, the assembly of a motherboard

(single board computer) into a housing

would not represent the requisite

change in tariff classification under the

rules.

Customs Response: Customs disagrees

with the above comments. As noted

above, many of the tariff changes are

precluded because of a ‘‘simple

assembly’’ of the finished good. Section

102.1(o) defines this term as ‘‘the fitting

together of five or fewer parts all of

which are foreign (excluding fasteners

such as screws, bolts, etc.) by bolting,

gluing, soldering, sewing or by other

means without more than minor

processing.’’

With respect to the comment

regarding the mounting of a CPU chip

onto an otherwise stuffed printed circuit

board, Customs has ruled that the

simple mounting of a CPU chip

(classifiable in heading 8542, HTSUS)

onto a stuffed printed circuit board

(classifiable in heading 8473, HTSUS),

which results in a good (a

‘‘motherboard’’) classified in

subheading 8470.10 through 8471.91, is

not a complex and meaningful operation

which should confer origin. See, HQ

734518 dated June 28, 1993, wherein

Customs ruled that the mounting of a

CPU chip onto the motherboard was a

simple operation which did not

constitute a substantial transformation.

Therefore, if both the CPU chip and the

stuffed printed circuit board are of

foreign origin, pursuant to § 102.1(o),

the operation of mounting the CPU chip

onto the board is a simple assembly and

the result reached under the § 102.20

rule is consistent with the Customs

position set forth in the cited ruling.

However, if either the CPU chip or the

stuffed printed circuit board is of

domestic origin, the operation would

not be considered a simple assembly

under § 102.1(o) and, therefore, the

motherboard would meet the tariff shift

rule and a change of origin would occur.

In addition, even if there is a ‘‘simple

assembly’’ and the tariff shift rule is not

met, by operation of the § 102.11

hierarchy, it must be determined under

§ 102.11(b) whether one of these parts

imparts the essential character to the

finished motherboard. If, as a result of

the consideration of relevant factors set

forth in § 102.18(b), it is determined that

one of these parts imparts the essential

character to the good, the origin of that

part is the origin of the good. If neither

of these parts imparts the essential

character to the good, then pursuant to

§ 102.11(d) the origin of the good would

be the country of origin of both parts if

they are products of the same country,

or the country in which the

motherboard was finally assembled if

these parts have different countries of

origin.

Contrary to the general tenor of the

comments, Customs believes that, as

compared to Customs current practice

and rulings under which these goods

may have multiple countries of origin in

many instances, the part 102 rules for

computers are fairly liberal and easily

implemented. Essentially, any change in

tariff classification at the subheading

(six-digit) level results in a change of

origin, unless the change is from

heading 8473 (parts for computers) or

unless the change is from another

subheading within the same group

covered by the rule, in which case the

change in tariff classification still could

be allowed so long as the change did not

result from a ‘‘simple assembly’’ of the

finished good.

With respect to the issue of the

motherboard, Customs has consistently

held that a completed motherboard

imparts the essential character to a

computer and is therefore classified in

the same provision as the computer. The

term, ‘‘motherboard’’ generally refers to

a single board computer generally

missing only the housing, fan, and

power supply. Therefore, Customs

would not consider that there has been

a substantial transformation, i.e., a

change in name, character or use as a

result of incorporating a motherboard

into a housing. Therefore, since the

motherboard is not classified under

heading 8473 or outside the subheading

covering the computer to which it

relates, but instead is classified as the

computer itself, any foreign

motherboard will not meet the § 102.20

rule, even if the finished computer did

not result from a ‘‘simple assembly’’.

Customs believes this interpretation is

entirely consistent with Customs’

longstanding position that the

motherboard, when assembled into a

housing to make the finished computer,

does not undergo a substantial

transformation. See HQ 734093 dated

August 8, 1991, where Customs ruled

for country of origin marking purposes

that the final assembly of motherboards

(i.e., boards that already included the

CPU chips) with other components

consisting primarily of connectors did

not result in a substantial

transformation of the motherboard.

B. Comment on Subheading 8470.50

(Point-of-Sale Terminals)

One comment was received

concerning the specific rule applicable

to point-of-sale terminals which are

classifiable in subheading 8470.50,

HTSUS. This commenter states that

these goods rarely consist of more than

five parts (a logic unit, a keyboard, a

printer unit, a display stand and a cash

drawer) and thus expresses concern

about the difficulty in meeting the

§ 102.20 rule.

Customs Response: Customs disagrees

with this comment, which was not

supported by specific facts. Customs

believes it is unlikely that the assembly

of a point-of-sale terminal would

include five or fewer parts. For instance,

if the assembler adds a power cord or

power supply to the unit as described

by the commenter, and all of these parts
28948 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

were assembled in one country, there

would have been an assembly of more

than five parts.

C. Comment on Processor Units of

Subheadings 8471.20 and 8471.91

One comment was received

concerning the application of the

§ 102.20 rule for goods of the above

subheading. This commenter expressed

concern that the incorporation of a hard

disk drive and a floppy disk drive of

subheading 8471.93, or a display unit of

subheading 8471.92, into processor

units of subheadings 8471.20 and

8471.91 would not be an acceptable

change in tariff classification under

§ 102.20.

Customs Response: Customs

disagrees. One of the § 102.20 rules for

processor units of subheadings 8471.29

and 8471.91 expressly allows a change

in tariff classification from hard or

floppy disk drives of subheading

8471.93 to display units of subheading

8471.92, since these latter subheadings

are outside the group to which the tariff

shift rule applies (that is, subheadings

8470.10 through 8471.91). Therefore,

incorporating disk drives and display

units into ADP processor units would

result in a tariff shift, thereby conferring

origin. This tariff shift rule is consistent

with Customs’ current position. See HQ

735608 dated April 21, 1995, wherein

Customs held that foreign components,

consisting of case assemblies, partially

completed motherboards (i.e., without

the CPU and, in some cases, BIOS), hard

disk drives and slot boards, which were

further processed and assembled into

desktop computers in the United States

were substantially transformed as a

result of the U.S. operations.

Subheadings 8471.92–8472.90 (Other

Machines for Transcribing or Processing

Coded Data or Other Office Machines)

A. Comment on Subheading 8471.92

(Printers)

The § 102.20 rules for goods of

subheadings 8471.92 through 8472.90

were proposed to be revised in the May

5, 1995, notice of proposed rulemaking

to read as follows:

A change to subheading 8471.92 through

8472.90 from any subheading outside that

group, except heading 8473; or A change to

subheading 8471.92 through 8472.90 from

any subheading within that group or from

heading 8473, provided the change is not the

result of a simple assembly.

One comment was received on the

§ 102.20 rules as they relate to printers.

This commenter claims that a

substantial transformation occurs in the

country where any one of the media

transport, control or print mechanisms

are combined with the others, and with

other parts, to make a functional printer.

The concerns expressed by this

commenter are linked to the fact that as

a result of the application of GRI 2(a),

the tariff classification for printers,

subheading 8471.92, includes

unassembled printers as well as printers

missing one of the components (i.e.,

media transport, control or print

mechanisms). Thus, if the components

at issue are classified in the same

provision as the finished printer as a

result of GRI 2(a), the § 102.20 rule,

which requires a change to the

subheading from another subheading

outside the group, or a subheading

change within the described group if the

change did not result from a simple

assembly, will not be met.

Customs Response: Customs believes

that the result described by this

commenter properly reflects the

application of the substantial

transformation principle. With the

exception of the rule for television

receivers (subheadings 8528.10 through

8528.20) and video display units

(computer monitors) of subheading

8471.92) discussed later in this

document, Customs believes that even

when there are two or more materials

that are classified in a provision from

which a change in tariff classification is

not allowed under the § 102.20 rule, if

one material (e.g., a printer

subassembly) is classified in the same

HTSUS provision as the finished good,

such material invariably will constitute

pursuant to § 102.11(b) the ‘‘single

material’’ that ‘‘imparts the essential

character’’ to the good, and the origin of

that material will be the origin of the

finished good.

On the other hand, if the printer is

imported completely unassembled, but

the § 102.20 rule will not have been met

because of the classification of the

unassembled printer as the finished

good, country of origin may not be able

to be determined under § 102.11(b) if no

single one of the unassembled

components, alone, imparts the

essential character to the printer. In

such instance, if there are more than

five parts, or if some of the parts are of

domestic origin, pursuant to § 102.11(d),

the country of origin of the printer could

be the country of assembly. This

possibility further supports the opinion

of Customs that the § 102.20 rules,

coupled with the operation of the

§ 102.11 hierarchy, do not depart from

Customs’ current application of the

substantial transformation principle.

B. Comments on Subheading 8471.93

(Storage Devices)

The § 102.20 rule for these goods is

the same rule applicable to the printers

discussed in the previous comment

analysis. The tariff classification for

ADP storage units will include units

without read-write units assembled

therein and read-write units separately

entered. Similar to the printer

components discussed above, these

components are classified pursuant to

GRI 2(a) as unassembled or incomplete

storage units because they have the

essential character of the finished good.

Therefore, like the printers components,

these units do not meet the § 102.20

tariff shift rule for storage devices. Two

comments were received concerning the

§ 102.20 rule for these goods. Both

commenters expressed concern that the

assembly of a storage unit into a rack

containing other storage units would not

be considered a substantial

transformation and that when multiple

storage units are rack mounted (storage

array), they would retain their original

country of origin.

Customs Response: The response to

the comment concerning printers is

hereby incorporated by reference since

the analysis set forth therein is equally

applicable to the storage units described

by these commenters. However,

Customs agrees with the present

commenter’s observation that, in this

case, if the § 102.20 rule is not met, the

country of origin will be the country or

countries of origin of the storage units.

The storage unit(s), regardless of their

number, will be considered as the

‘‘single material that imparts the

essential character’’ to the good, and

pursuant to § 102.11(b), the country or

countries of origin of the storage units

will be the country or countries of origin

of the rack mounted storage units.

Customs believes this outcome is

entirely consistent with that reached

under the current application of the

substantial transformation principle.

C. Comment on Subheading 8471.93

(Control/adapter Units)

One comment was received with

respect to the § 102.20 rule for these

goods. This commenter states that if

control or adapter units were to be

assembled in the United States, they

could be comprised of other ADP units

(disk drives and power supplies) which

would not undergo a tariff shift.

Customs Response: Customs disagrees

with this observation and believes that

the rule in question appropriately

reflects the substantial transformation

principle. The disk drive and the power

supply do not impart the essential
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28949

character to the finished control or

adapter unit. In fact, a control or adapter

unit that is imported without the disk

drive and power supply would be

classifiable as an unfinished control or

adapter unit as a result of the

application of GRI 2(a). Thus, the fact

that there will be no change in tariff

classification is consistent with the view

of Customs that the subsequent

assembly of these units with the disk

drive and power supply does not

substantially transform the imported

units. See the above comment analysis

regarding printers. Contrary to the

commenter’s claim, this result does not

represent a departure from current

practice, and there are no rulings to

support the commenter’s position.

Heading 8473 (Parts and Accessories of

Machines of Headings 8469–8472)

Comments: The § 102.20 rule for

goods of heading 8473 proposed in the

May 5, 1995, notice of proposed

rulemaking provides for a tariff shift to

heading 8473 ‘‘from any other heading,

except when the change is from heading

8414, 8501, 8504, 8534, 8541, or 8542 as

a result of a simple assembly.’’ Three

comments were received concerning

this proposed rule. One commenter

stated its view that the process of

fabricating key components should not

be a necessary condition for a final

product to obtain origin status. Another

commenter claims that any change from

heading 8414, 8501, 8504, 8534, 8541,

or 8542 to heading 8473 should be

considered a substantial transformation.

This commenter cites example 3 in 19

CFR 10.14(b) in which a complex and

meaningful production process of a

circuit board is described. Finally, the

third commenter seeks to have the rule

further revised to allow the

programming of goods of heading 8473

to result in a change of origin. As

support for this position, this

commentor cites HQ 733085 dated July

13, 1990, as clarified and affirmed by

HQ 558868 dated February 23, 1995,

wherein Customs held that the U.S.

programming of random access memory

(‘‘RAM’’) chips in access security cards

constituted a substantial transformation

of the imported card.

Customs Response: Customs strongly

disagrees with the comments advocating

that the § 102.20 rule should allow

simple assemblies of key components to

confer origin. It has been long

established as a principle, by both

Customs and the courts, that key

components can impart the essential

character to the good and consequently

will not be substantially transformed by

subsequent processing and assembly

operations. See Uniroyal, Inc. v. United

States, supra. The operations described

in the example cited in 19 CFR 10.14(b)

clearly do not constitute a ‘‘simple

assembly’’ and therefore would meet the

criteria set forth in the proposed

§ 102.20 rule. Thus, the proposed rule is

consistent with the example cited by the

commenter. On the other hand, since a

good of heading 8473 can be created by

the mere joining of two items, Customs

believes the § 102.20 rule properly

disallows changes from key components

of goods classified under heading 8473

when the change in tariff classification

results from a ‘‘simple assembly’’. This

result is consistent with the position of

Customs and the courts that not all

assembly and testing operations result

in a substantial transformation of the

articles subjected to these operations.

Customs also does not agree with the

comment that the programming of goods

classifiable in heading 8473 should be

allowed to result in a change in origin

such as is allowed for goods classified

in headings 8541 and 8542. Articles that

are classified in heading 8473 consist of

a combination of goods that are more

than a single integrated circuit of

headings 8541 and 8542 and are already

identifiable as computer parts and

accessories. In order for a good to be

classifiable as a computer part or

accessory of heading 8473, it usually

consists of a significant number of

different types of electronic

components. As such, they have a

substantial identity as computer parts

and accessories which is distinct from

any individual integrated circuits of

which they may be composed.

Therefore, any programming of the

individual chips resident on a printed

circuit board that already has the

identity of a heading 8473 ADP part or

accessory in no way changes the name,

character or use of that computer part or

accessory. On the other hand, articles

classified in headings 8541 and 8542 are

utilized in any number of different

goods which are classified in numerous

other provisions. Customs recently

ruled in HQ 958314, issued November

29, 1995, that the good which was the

subject of HQ 733085 and HQ 558868

cited by the third commenter is

classifiable, both before and after the

programming, in heading 8542. The

programming of goods of headings 8541

and 8542 changes their essential

character since the programming

dedicates the chips to certain

applications and the § 102.20 rule for

these goods expressly codifies this

position. Customs believes its views are

consistent with the court’s decision in

Data General Corporation v. United

States, 4 CIT 182 (1982). Therefore, the

May 5, 1995, proposed revision of the

§ 102.20 rule for these goods of heading

8473 should be adopted.

Subheadings 8482.10–8482.80

(Bearings)

Comments: The § 102.20 rule set forth

in the May 5, 1995, notice of proposed

rulemaking for subheadings 8482.10

through 8482.80 provides as follows:

A change to subheading 8482.10 through

8482.80 from any other heading; or

A change to subheading 8482.10 through

8482.80 from any other subheading,

including another subheading within that

group, except from inner or outer races or

rings of subheading 8482.99.

One comment was received on the

proposed rule. This commentor claims

that the processes of grinding, polishing

and heat treating of rings and races

should confer origin.

Customs Response: Customs

disagrees. It remains the position of

Customs that these types of operations

are merely finishing operations which

do not confer origin. None of these

operations changes the essential

character of the article which is

processed. The name, character and use

of the article remain the same after these

operations are performed. See National

Hand Tool Corp. v. United States,

supra, wherein the court held that

operations such as grinding, polishing

and heat treating are merely finishing

operations which do not constitute a

substantial transformation. Therefore,

the revision of the § 102.20 rule for

these goods should be adopted as

proposed.

Subheading 8518.21–8518.22

(Loudspeakers)

Comment: One commenter alleges

that the § 102.20 rule for subheadings

8518.21 and 8518.22, which requires a

change from any other heading, is

inconsistent with the substantial

transformation test. This commenter

states that consumer speakers mounted

in an enclosure, classifiable under either

subheading 8518.21 or subheading

8518.22, can consist of a tweeter, a midrange, a woofer, or any combination of

the these three loudspeakers, while the

speaker drive units (i.e., loudspeakers),

which are not mounted in an enclosure

and which are used to manufacture

complete speaker systems, are not

consumer products and are classifiable

under subheading 8518.29, HTSUS.

Therefore, it is claimed that the § 102.20

rule is contrary to the substantial

transformation test in that it does not

consider the intricacies of the crossover

network, the circuitry usually necessary

to deliver each band of signals to the

correct loudspeaker when a speaker
28950 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

system contains a tweeter, a mid-range,

and a woofer.

Customs Response: Customs

disagrees. In HQ 556699 dated

December 28, 1992, Customs held that

the manufacture of completed speakers

consisting of a woofer, tweeter,

midrange cone drivers, crossover

networks, and particle board from

which the speaker housing was

constructed were considered ‘‘products

of’’ Mexico for purposes of the GSP, but

only the cost or value of the particle

board could be included in the 35

percent value-content calculation. In

that ruling Customs also found that the

enclosure of a stereo chassis (radio

receiver, dual cassette deck) with a

housing, and with the addition of

speakers, did not serve to change the

identity of the stereo chassis and did not

transform the stereo chassis into a new

and different article of commerce

because the stereo chassis was the

essence of the stereo system.

The interim § 102.20 rule for these

goods provides for a change in heading.

In HQ 559139 dated August 31, 1995,

Customs considered the country of

origin of a loudspeaker system

classifiable under subheading 8518.22,

HTSUS, containing a woofer, a tweeter,

and a crossover network under the

interim Part 102 regulations. Applying

the hierarchy set forth in § 102.11,

Customs determined that since the

woofer and tweeter installed into the

loudspeaker system were classifiable

under the same heading, namely

heading 8518, HTSUS, the § 102.20 rule

was not met and § 102.11(b) was then

applicable. Since both the woofer and

the tweeter were equally important in

producing the sound frequencies of the

system, neither component imparted the

essential character to the loudspeaker

system for purposes of determining its

country of origin under § 102.11(b).

Thus, the country of origin of the

loudspeaker system was finally

determined, pursuant to § 102.11(d), to

be the last country in which the

loudspeaker system underwent

production, other than by simple

assembly or minor processing, which is

consistent with the determination in HQ

556699.

In HQ 559139 Customs also

determined, under the interim part 102

rules, the country of origin of

loudspeaker systems containing only a

woofer. Pursuant to § 102.11(b) of the

interim regulations, the country of

origin was determined to be the country

of origin of the woofer and not the

country where the loudspeaker system

was manufactured. While Customs has

not issued a ruling regarding the origin

of a loudspeaker containing only one

speaker drive unit outside of the context

of the interim part 102 rules, it is the

position of Customs that the cited ruling

under the interim Part 102 rules reflects

a proper application of the substantial

transformation test. Just as the stereo

chassis in HQ 556699 was considered

the very essence of the stereo system,

the woofer in HQ 559139 was the single

material imparting the essential

character of the loudspeaker and no

crossover network was required to

produce the desired sound. Therefore, it

is the opinion of Customs that the Part

102 rules codify the Customs

interpretation of the substantial

transformation principle with respect to

loudspeakers classifiable in subheadings

8518.21 and 8518.22, HTSUS.

Subheadings 8528.10–8528.20

(Televisions) and Subheading 8471.92

(Display Units)

A. Comments on Television Receivers

The May 5, 1995, notice of proposed

rulemaking proposed to amend the

§ 102.20 rule for the above goods to read

as follows:

A change to subheading 8528.10 through

8528.20 from any other subheading,

including another subheading within that

group, except from subheading 8540.11

through 8540.12.

Two comments were received in

response to the above proposed text.

The commenters state that the drafters

of the HTSUS clearly recognized the

overwhelming importance of the

television chassis to the functioning of

a television by creating 8-digit breakouts

for incomplete or unfinished television

receivers (subheadings 8528.10.04 and

8528.10.08). These subheadings cover,

inter alia, ‘‘assemblies for television

receivers consisting of all the parts

specified in additional U.S. Note 10 to

this chapter plus a power supply’’

(which collectively are known in the

industry as ‘‘chassis’’) which thus fall

under the same 6-digit subheading

(8528.10) as the television receiver

itself. The commenters further state that

by creating these subheadings under the

6-digit subheading for television

receivers, the HTSUS drafters

recognized that the function of the

chassis is so important that it must be

classified as an incomplete or

unfinished television receiver (and not

merely as a part thereof). (In the

background discussion of the May 5,

1995, proposed amendment, Customs

stated that ‘‘the television tube may

determine origin for some television

sets.’’) The commenters state that since

the chassis is considered to be an

incomplete or unfinished television

receiver, without the picture tube, it

would be inconsistent for Customs to

conclude that the picture tube

constitutes the single material imparting

the essential character to the television

receiver.

Customs Response: After careful

consideration of the comments, it is

Customs’ view that, for purposes of

determining the country of origin of a

finished television receiver, neither the

picture tube nor the television chassis

independently imparts the essential

character to the television receiver.

Customs previously has recognized the

substantial transformation of both a

foreign chassis and a foreign tube when

assembled with other components to

make a finished television receiver. In

HQ 711967 dated March 17, 1980,

Customs found that U.S.-origin picture

tubes, cabinets, and wiring were

substantially transformed in Mexico

when they were assembled in Mexico

with Korean origin printed circuit

boards, power transformers, yokes and

tuners, since the operations performed

in Mexico resulted in the foreign

components becoming integral parts of

a new article (the television receiver).

On the other hand, in HQ 732170 dated

January 5, 1990, Customs ruled that the

assembly in the United States of a

foreign chassis with a U.S. picture tube

assembly and remote control unit

resulted in a substantial transformation

of the imported chassis and other

components. As the above rulings

illustrate, Customs has considered both

the chassis and the tube assembly as

integral parts of a finished television

receiver. In neither case did a foreign

chassis or a foreign tube determine the

country of origin of the completely

assembled television receiver. It is for

the purpose of maintaining this result

that the § 102.20 rule will not be

satisfied whenever either the tube or the

chassis is of foreign origin. As

illustrated below, however, Customs

believes that a proper application of the

§ 102.11 hierarchy will yield a result

that is entirely consistent with the

results reached in the above cited

Customs rulings.

In applying the proposed § 102.20

rule for television receivers, Customs

finds that neither the chassis nor the

picture tube undergoes the requisite

tariff shift. Therefore, it is necessary to

proceed to § 102.11(b) to see if origin of

the television receiver can be

determined under that provision.

Section 102.11(b) states that where the

country of origin cannot be determined

under paragraph (a), the country of

origin of the good is the country or

countries of origin of the ‘‘single

material’’ that imparts the essential

character to the good. Customs does not
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28951

agree with the commenters’ suggestion

that the fact that the chassis is classified

in the same 6-digit HTSUS subheading

as the television receiver should dictate

the conclusion that the chassis is the

‘‘single material’’ that imparts the

essential character to the television.

Based upon consideration of the factors

cited in § 102.18(b), Customs would

conclude that for purposes of

determining the country of origin of a

television under § 102.11(b), neither the

picture tube assembly nor the television

chassis independently imparts the

essential character to this good.

Section 102.11(c) also will not be

applicable since the completed

television receiver is not classified

under the HTSUS as a ‘‘set’’, ‘‘mixture’’,

or ‘‘composite good’’. Thus, the country

of origin of the television receiver must

be determined under § 102.11(d)(1).

Under § 102.11(d), unless the finished

television receiver is produced as a

result of a ‘‘simple assembly’’ (as

defined in § 102.1(o)) of the tube

assembly, chassis, and cabinet which

are all goods of the same country, the

country of origin of the finished

television receiver will be the country in

which it is finally assembled.

B. Comments on Video Display Units

(Computer Monitors) of Subheading

8471.92:

One comment was received

concerning the proposed § 102.20 rules

for display units classified in

subheading 8571.92 (the text of the

proposed rules is set forth in the above

discussion of printers of subheading

8471.93). This commenter expressed

concern that if a power supply and a

cathode ray tube (CRT) are of foreign

origin but all other components are

domestic, the § 102.20 rule will not be

satisfied.

Customs Response: If the CRT is

imported separately it will be classified

in heading 8540 and thus the proposed

§ 102.20 rule for display units will be

met under the facts described by the

commenter. Therefore, Customs

assumes that this commenter’s primary

concern stems from the fact that a CRTdeflection yoke subassembly is

classified in subheading 8471.92 as an

unfinished display unit, and the

subsequent combining of this

subassembly with another part, such as

a power supply, will not meet the

requisite change in tariff classification

rule.

Inasmuch as Customs traditionally

has treated televisions and computer

monitors as comparable articles for

purposes of rulings regarding

substantial transformation of

televisions, such rulings are equally

relevant for resolving substantial

transformation issues for computer

monitors; accordingly, the above

comment response regarding television

receivers is relevant to the § 102.20 rules

for display units. In HQ 734966 dated

October 18, 1993, Customs noted prior

rulings on the substantial

transformation of television tubes and

chassis and ruled that the assembly in

the United States of a foreign integral

tube component (CRT and mounted

yoke), printed circuit board, video

board, cabinet backs and fronts, cables

along with U.S. electrical connectors,

wires, etc., to create the finished video

display terminals resulted in a

substantial transformation of the foreign

components.

Consistent with the view expressed

above with regard to television chassis

which are classified in the same

provision as the finished television

receivers, Customs concludes that the

fact that the CRT-yoke subassembly is

classified in the same provision as the

finished display unit does not dictate

the conclusion that this component,

alone, imparts the essential character to

the video display unit for origin

purposes. The integral role played by

parts (for example, a subassembly

consisting of the printed circuit board,

video board, cabinet backs and fronts,

electrical connectors, etc.) classified in

heading 8473 (a provision excluded

under the specific tariff shift rule) in the

function of a video display unit is well

established. Thus, in cases involving

facts similar to those presented in HQ

734966, origin will not be determined

on the basis of the CRT-yoke

subassembly under § 102.11(b), and

since such facts would not involve a

‘‘simple assembly’’ as defined in

§ 102.1(o), Customs believes the same

origin result that was reached in HQ

734966 can be reached under

§ 102.11(d).

Heading 9001 (Spectacle Lenses,

Optical Elements)

Comment: One comment was received

regarding the § 102.20 rules applicable

to spectacle lens and other optical

elements made from lens blanks of

Chapter 70. The relevant § 102.20 rules

provide as follows:

A change to subheading 9001.40 through

9001.90 from any other subheading,

including another subheading within that

group, except from lens blanks of heading

7014 or subheading 7015.10.

A change to subheading 9002.11 through

9002.90 from any other subheading,

including another subheading within that

group, except from subheading 9001.90 or

lens blanks of heading 7014.

This commenter claims that since

grinding and polishing lens blanks

(which are classified in heading 7014) to

produce unmounted lenses (which are

classified in heading 9001) results in a

change in tariff classification, it should

be recognized as a substantial

transformation under the § 102.20 rules

for unmounted lenses.

Customs Response: Customs

disagrees. As Customs has stated

consistently in connection with the

proposed uniform origin rule concept,

the Part 102 rules are intended to codify

the interpretation of the substantial

transformation principle by Customs

and the courts, rather than to create a

new standard for determining origin. As

has been recognized by the courts, the

fact that certain operations may or may

not result in a change in tariff

classification is not always dispositive

of the issue of substantial

transformation. See Superior Wire v.

United States, supra. Thus, Customs has

endeavored to develop a hierarchy for

determining country of origin which

allows certain tariff classification

changes to result in origin changes,

while disallowing others which yield

results that are inconsistent with the

substantial transformation principle as

interpreted by Customs and the courts.

With regard to the issue raised by this

commenter, in HQ 555923 dated June

17, 1991, Customs ruled that the further

grinding and polishing of lens blanks

into finished lenses did not result in a

‘‘double substantial transformation’’ of

the raw materials, which consisted of

cylindrical rods of base metals, specialty

glasses, and sheets or rods of dielectrics,

for purposes of the value-content

requirement under the Generalized

System of Preferences. This ruling was

affirmed upon reconsideration in HQ

556360 dated July 7, 1992, where

Customs ruled that the raw materials

used to make the lens blanks did not

undergo a second substantial

transformation as a result of the further

operations to make polished lenses. (Of

note is the fact that Customs has

applied, consistent with the court cases

in this area, a more liberal application

of the substantial transformation

standard for purposes of the second

substantial transformation required to

receive duty preferences.) In a more

recent internal advice opinion relating

to an investigation, Customs again took

the position that the processing of

foreign lens blanks into polished

unmounted lenses did not result in a

substantial transformation of the lens

blanks since, once the lens blanks were

formed into the configuration of the

lens, they had a predetermined

character and use as a lens and could
28952 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

not be used thereafter for other

purposes. Customs believes that the

application of the substantial

transformation principle in the above

cases is supported by the court

decisions in Superior Wire v. United

States, supra, and National Hand Tool

Corp. v. United States, supra. Thus, the

§ 102.20 rules for these heading 9001

goods properly disallows the change in

tariff classification from lens blanks. As

a result of the operation of the § 102.11

hierarchy, the country of origin of

unmounted lenses of heading 9001

made from foreign lens blanks of

heading 7014 or subheading 7015.90

will be determined to be the country of

origin of the lens blank pursuant to

§ 102.11(b).

Subheadings 9003.11–9003.19 (Eyeglass

Frames)

Comment: One comment was received

concerning the § 102.20 rules for the

above goods. The rules pertaining to

subheadings 9003.11 through 9003.10

provide as follows:

A change to subheading 9003.11 through

9003.19 from any other heading; or

A change to subheading 9003.11 through

9003.19 from any other subheading,

including another subheading within that

group, except from subheading 9003.90,

unless the temples or fronts are domestically

produced.

The commenter claims that the above

rules are inconsistent with the country

of origin rules presently applied by

Customs. The commenter states that

under Customs’ current practice, it has

consistently and uniformly been

recognized that unfinished and

unusable eyeglass temples and fronts

manufactured in Country A, which are

exported to Country B for further

processing and finishing operations, are

subjected to a substantial transformation

and thus qualify as products of Country

B for country of origin marking

purposes.

Customs Response: Customs

recognizes that its position on

substantial transformation of eyeglass

frames has not been consistent over the

years. In HQ 709266 dated July 11, 1978

Customs ruled that the assembly of

eyeglass frames did not constitute a

substantial transformation. In C.S.D. 80–

43, dated July 17, 1979, however,

Customs ruled that eyeglass fronts and

temples that were subjected to further

processing and assembly were

substantially transformed. In HQ 728504

dated October 15, 1985, Customs again

reverted to the conclusion that the

assembly of imported eyeglass fronts

and temples did not result in a

substantial transformation of those

parts. The latter position was again

taken in HQ 734663 dated September 4,

1992, wherein Customs ruled that fronts

and temples, which were imported into

the United States in partially finished

conditions from various suppliers

worldwide and which were colored and

assembled together in the United States

along with other minor parts, were not

substantially transformed in the United

States. Subsequently, in HQ 734771

dated December 17, 1992, Customs

ruled that fronts and temples, which

were further machined, trimmed,

assembled and polished, were

substantially transformed.

Contrary to the commenter’s claim,

Customs has not recognized all finishing

and assembly of fronts and temples into

eyeglass frames as resulting in a

substantial transformation of those

parts. The above rulings, however,

illustrate why both Customs and the

trade community need more

transparency and predictability in origin

determinations. Customs believes that

the proposed § 102.20 rules for eyeglass

frames and the remaining rules in the

§ 102.11 hierarchy achieve this goal,

while remaining faithful to the

substantial transformation principle.

The tariff shift rules in question still

allow a change from fronts and temples

to finished frames, provided that either

the temples or fronts are domestic

materials, i.e., they are goods of the

country of assembly. In the absence of

such a limitation, a change of origin

could result from the simple combining

of two foreign parts (fronts and

temples), a result which neither

Customs nor the courts have allowed

under the application of the substantial

transformation principle.

If the country of origin is not

determined under § 102.11(a)(3) (that is,

by meeting the criteria in the § 102.20

rules), § 102.11(b) of the hierarchy

would next apply. However, since both

the fronts and temples are important

components of eyeglass frames, it would

be difficult to conclude that either the

fronts or the temples, alone, impart the

essential character to the finished

frames. Thus, it would be highly

unlikely that country of origin could be

determined pursuant to § 102.11(b).

Accordingly, the country of origin of the

eyeglass frame most probably would

have to be determined under

§ 102.11(d). If the good was not

produced as a result of a ‘‘simple

assembly’’ (as defined in § 102.1(o)) of

fronts and temples from the same

country, the country in which the

eyeglass frames were assembled would

be the country of origin under

§ 102.20(d). If there was a ‘‘simple

assembly’’ of fronts and temples of the

same country of origin, then the country

of origin of those parts would be the

country of origin of the eyeglass frames

under § 102.11(d). Customs believes the

foregoing demonstrates that the

application of the § 102.11 hierarchy

will result in origin determinations that

are not only consistent with Customs’

past practice but also far more

transparent and predictable.

Subheadings 9018.31–9019.90 (Surgical

Instruments)

Comment: The § 102.20 rules

applicable to the above goods basically

require a change from any other

subheading, except from certain

provisions that are not relevant to the

one comment submitted regarding these

goods. A commenter claims that surgical

instruments often are made from steel

forgings produced in one country (e.g.,

the United States or Germany) and

further processed by machining

operations in a second country (e.g.,

Pakistan, Hungary, Russia). Both the

forgings and the machined surgical

instruments are classified in subheading

9018.90 as other medical instruments.

The commenter claims that on several

occasions, Customs has ruled that the

machining of a steel forging

substantially transforms the forging into

a surgical instrument and cites C.S.D.

80–15 of June 25, 1979, HQ 553197

dated February 11, 1985, and C.S.D. 90–

53 of February 12, 1990, as support for

his position. The commenter claims that

the § 102.20 rules should codify these

rulings.

Customs Response: Customs

disagrees. The Court of International

Trade recently considered whether the

processing of forgings classified in the

same provision as the finished good

resulted in a substantial transformation

in National Hand Tool Corp. v. United

States, supra, a country of origin

marking case. At issue in National Hand

Tool was whether certain imported

hand tool components processed in the

United States underwent a substantial

transformation. The components were

either cold-formed or hot-forged into

their final shape in Taiwan (except the

speeder handle, which was bent to

shape in the United States), while others

underwent heat treatment in Taiwan. In

holding that there was no substantial

transformation of the imported forgings,

the court found that the name of each

article as imported was the same as that

of the completed tool, that the character

of the articles remained unchanged after

the operations, and that the use of the

imported articles was predetermined at

the time of importation. Customs is now

of the opinion that steel forgings

subjected to processes similar to those

considered in National Hand Tool also
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28953

do not undergo a substantial

transformation, because such processing

does not result in a change in the name,

character, and use of the imported steel

forgings. See HQ 558747 dated January

20, 1995. The Part 102 rules codify

Customs current position which applies

the rationale of National Hand Tool.

Assuming arguendo that two or more

imported forgings are classified in

subheadings 9018.31 through 9019.90 as

parts or accessories of surgical

instruments, the § 102.20 rule will not

be met when the finished surgical

instruments are produced. The next step

is to go to § 102.11(b) and determine

whether a single imported component

imparts the essential character to the

surgical instruments. Since the forgings

are classified in provisions from which

a change is not allowed under the

applicable § 102.20 rule, pursuant to

§ 102.18(b) these are the parts

considered for purposes of determining

if a single material imparts the essential

character to the finished good.

Depending upon the type of surgical

instrument at issue, a single steel

forging could constitute the single

material that imparts the essential

character to the surgical instrument. In

such instances, under § 102.11(b), the

country of origin would be the country

in which that steel forging is produced.

This result would be entirely consistent

with the position taken by the court in

the National Hand Tool case.

Headings 9101–9110 (Watches and

Watch Movements)

Comments: Customs proposed to

amend the § 102.20 rules for clocks and

watches and for complete and

assembled movements by adding in

each case a second rule to allow changes

from complete movements,

unassembled (movement sets), of

subheading 9110.11 or 9110.90, or from

rough movements of subheading

9110.19 or 9110.90. Customs also

proposed to amend the rules applicable

to heading 9110 (relating to watch and

clock movements, complete and

unassembled or partly assembled,

incomplete movements, and rough

movements) by deleting the alternative

rule which allowed a change from

subheading 9114.90 ‘‘if there had been

a substantial transformation.’’

Two comments were received

concerning the above proposals. Both

commenters generally agree with the

proposed amendments. One commenter

agrees with Customs position that a

change should not be allowed from an

incomplete watch or clock movement,

assembled, to a complete movement, but

only to the extent that such items are so

close to being complete movements that

the final manufacturing steps needed to

complete the movements are

insignificant. The other commenter

questions why Customs did not also

propose to allow a change to headings

9101 through 9109 from incomplete

watch or clock movements, assembled,

of subheading 9110.12. This commenter

states that from the producer’s

standpoint, the manufacturing

operations necessary to produce a

finished movement from either an

incomplete movement or a rough

movement are significant.

With regard to the § 102.20 rule for

heading 9110, one of the commenters is

of the opinion that the rule should allow

a change to this heading from any other

heading or subheading, including

subheading 9114.90. The other

commenter, however, agrees with

Customs’ ‘‘apparent analysis’’ that little

or no manufacturing may be involved

when, for example, a movement set is

put together from subheading 9114.90

assemblies and subassemblies.

Customs Response: Customs

continues to believe that a change in

tariff classification should not be

allowed from subheading 9110.12 to

headings 9101 through 9109 because an

incomplete movement may be

essentially a movement and, therefore,

allowing such a change would be

inconsistent with Customs’

longstanding interpretation of the

substantial transformation principle.

Customs also notes that, as stated in the

May 5, 1995, notice of proposed

rulemaking, the proposal to exclude the

alternative rule for heading 9110 is

necessary to avoid redundancy.

Customs believes that if a required

change in tariff classification does not

occur under § 102.20, when in fact there

has been a substantial transformation of

the foreign material at issue, a

substantial transformation result will

still be reached under the § 102.11 rules.

As noted in the May 5, 1995, notice

of proposed rulemaking and elsewhere

in this document, the general rules for

determining the country of origin of a

good in §§ 102.11 (a) through (d) are

applied in a hierarchal and sequential

manner. Thus, although a prescribed

change in tariff classification may not

occur for purposes of determining origin

under §§ 102.11(a)(3) and 102.20, the

country of origin of a movement made

from an incomplete movement of

subheading 9110.12 or a part of

subheading 9114.90 will nevertheless be

determined once the appropriate rule in

the § 102.11 hierarchy is applied.

Depending upon several factors, the

foreign material classified in subheading

9110.12 or 9114.90 may constitute the

single material that imparts the essential

character to the complete movement for

purposes of determining the country of

origin under § 102.11(b). On the other

hand, if there are several components

properly being considered under

§§ 102.11(b) and 102.18(b), and if no

single component imparts the essential

character to the complete movement,

then the country of origin will be

determined to be the country in which

the movement was produced (provided

that such production was not the result

of a ‘‘simple assembly’’ of parts from the

same country).

Subheading 9506.31 (Golf Clubs)

Comment: The § 102.20 rule for golf

clubs provides for a change to

subheading 9506.31 (complete golf

clubs) from any other subheading,

except from subheading 9506.39 (parts

of golf clubs). One comment was

received concerning this rule. A

commenter states that it has been

Customs’ longstanding position that the

process of joining the essential

component parts—heads, shafts and

grips—into completed golf clubs

constitutes a substantial transformation

and, therefore, the country where this

process occurs is the country of origin

of the golf clubs. As support, this

commenter cites several Customs

rulings (HQ 724901 dated April 9, 1984,

HQ 728213 dated July 3, 1985, HQ

733185 dated April 11, 1990, HQ

733151 dated September 11, 1990, HQ

734136 dated June 17, 1991, and HQ

735125 dated November 17, 1993) in

which Customs ruled that the assembly

of either a foreign head or shaft with a

domestic head or shaft and a domestic

grip, or the use of foreign grips in the

manufacture of completed golf clubs in

the United States, resulted in a

substantial transformation of the foreign

head or shaft or grip so that the country

of origin of the completed golf club was

the United States where the assembly

took place.

Customs Response: Contrary to the

commenter’s suggestion, Customs has

not taken the general position that the

country of origin of a golf club is the

country in which it is finally assembled.

In fact, Customs has never ruled on the

question of whether the assembly in the

United States of a foreign head and shaft

with either a foreign or domestic grip

into a completed club results in a

substantial transformation of the

imported components, thereby making

the United States the country of origin

of the completed club. Customs,

however, believes that the § 102.20 rule

for golf clubs allows for the substantial

transformation principle to be applied

in a manner consistent with the

approach taken in the rulings cited by
28954 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

the commenter. Applying the § 102.20

rule to determine whether the foreign

components change their origin as a

result of an assembly operation,

Customs finds no tariff shift for the

imported components. However, if the

hierarchal rules of § 102.11 are properly

applied to the circumstances in the

above-cited rulings (e.g., assembly of a

golf club using a foreign head and a

domestic shaft and grip) Customs finds

that the same origin result can be

reached under the § 102.11 hierarchy.

If the § 102.20 rule is not met,

§ 102.11(b) will be applicable. If there is

a single component that imparts the

essential character to the golf club, the

country of origin of that component will

be the country of origin of the golf club.

If no single component can be found to

impart the essential character to the

finished golf club, § 102.11(d) is then

applicable (§ 102.11(c) would not be

relevant in this case). If the golf club

was not produced as a result of a

‘‘simple assembly’’ (as defined in

§ 102.1(o)) of parts from the same

country, then the country of origin of

the finished golf club would be the

country of assembly. Therefore,

Customs believes that the Part 102 rules

as a whole codify the substantial

transformation principle as applied to

golf clubs.

Other Changes

In addition to the changes mentioned

in connection with the above discussion

of public comments, the regulatory texts

set forth below incorporate the

following additional changes which

Customs believes are necessary based on

further internal review of the interim

and proposed regulatory texts:

1. A second sentence has been added

to the introductory text of § 102.20 to

provide that requisite tariff shifts within

the same heading must involve changes

in subheadings at the same (that is, 6-

digit) level. Since tariff classification is

the basis for the § 102.20 rules, Customs

believes that it is essential for those

rules to incorporate the fundamental

rule of tariff classification, as stated in

General Rule of Interpretation 6 of the

Harmonized System and the HTSUS,

that only subheadings at the same level

are comparable.

2. In § 102.20, the tariff shift rules for

subheadings 4202.12–4202.22, 4202.31–

4202.32, 4202.91–4202.99 and 4302.30

have been modified to refer to the

assembly of ‘‘foreign’’ (rather than

‘‘imported’’) cut components, because

the word ‘‘imported’’ does not

necessarily convey the origin

significance that was intended to be

attached to the cut components.

3. In § 102.20, the listings for headings

6815 and 7113–7115 have been

redrafted to reflect subheading rules, as

intended by the wording of the

respective interim tariff shift rules.

4. In § 102.20, the listing for

subheadings 7505.11–7505.22 has been

redrafted to reflect a heading 7505 rule.

This change removes an ambiguity in

the tariff shift rule and ensures

consistency with the rules for other

related headings of Chapter 75.

5. In § 102.20, the listing for headings

8545–8548 has been broken into two

listings, one for subheadings 8545.11–

8547.90 and the other for heading 8548.

This change clarifies the intent and

removes an ambiguity from the interim

text.

6. In § 102.20, the words

‘‘domestically produced’’ at the end of

the second tariff shift rule for

subheadings 9003.11–9003.19 have been

replaced by ‘‘domestic materials’’

because ‘‘produced’’ has no specific

legal meaning within Part 102 whereas

‘‘domestic material’’ is defined in

§ 102.1(d).

7. In § 102.20, the listing for headings

9701–9706 has been broken into two

listings, one for subheadings 9701.10–

9701.90 and the other for headings

9702–9706. This change clarifies the

intent and removes an ambiguity from

the interim text.

8. Finally, a number of other editorial

changes have been made in the interim

and proposed texts, including a large

number of changes to the provisions in

the table under § 102.20. These changes,

which correct typographical or other

obvious errors or inconsistencies in

language, are also not substantive in

effect.

Conclusion

Accordingly, based on the comments

received and the analysis of those

comments as set forth above, and based

on the additional considerations

discussed above, Customs believes that

the interim NAFTA Marking Rules and

the other interim regulations published

as T.D. 94–4 and the proposed

amendments to those interim

regulations published on May 5, 1995,

and on July 12, 1995, should be adopted

as a final rule with certain changes

thereto as discussed above and as set

forth below. Although this document

sets forth the majority of the interim

regulatory amendments and proposed

changes thereto adopted herein as a

final rule and thus both republishes

portions of the interim texts without

change and amends other portions of

the interim texts to incorporate the

changes discussed above, it does not

republish those unchanged interim

amendments involving § 12.130.

Inapplicability of Public Notice and

Comment Procedures

Pursuant to the provisions of 5 U.S.C.

553(a), public notice and comment

procedures are inapplicable to these

final regulations because they are within

the foreign affairs function of the United

States.

Executive Order 12866

Because this document involves a

foreign affairs function of the United

States and implements an international

agreement, it is not subject to the

provisions of E.O. 12866.

Regulatory Flexibility Act

Based on the supplementary

information set forth above and because

these regulations implement obligations

of international agreements, pursuant to

the provisions of the Regulatory

Flexibility Act (5 U.S.C. 601 et seq.) it

is certified that the regulations will not

have a significant economic impact on

a substantial number of small entities.

Accordingly, the regulations are not

subject to the regulatory analysis or

other requirements of 5 U.S.C. 603 and

604.

Drafting Information

The principal author of this document

was Francis W. Foote, Office of

Regulations and Rulings, U.S. Customs

Service. However, personnel from other

offices participated in its development.

List of Subjects

19 CFR Part 10

Customs duties and inspection,

Imports, Reporting and recordkeeping

requirements.

19 CFR Part 12

Customs duties and inspection,

Labeling, Marking, Reporting and

recordkeeping requirements, Textiles

and textile products.

19 CFR Part 102

Customs duties and inspections,

Imports, Reporting and recordkeeping

requirements, Rules of origin, Trade

agreements.

19 CFR Part 134

Country or origin, Customs duties and

inspections, Imports, Labeling, Marking,

Packaging and containers.

Amendments to the Regulations

Accordingly, part 10 is amended and

the interim rule amending parts 12 and

134 of the Customs Regulations (19 CFR

parts 12 and 134) and adding part 102
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28955

of the Customs Regulations (19 CFR part

102), which was published at 59 FR

110–140 on January 3, 1994, and which

was corrected at 59 FR 5082 on

February 3, 1994, is adopted as a final

rule with certain changes as discussed

above and set forth below.

PART 10—ARTICLES CONDITIONALLY

FREE, SUBJECT TO A REDUCED

RATE, ETC.

1. The general authority citation for

part 10 continues to read as follows, and

the specific authority citation for § 10.22

is removed:

Authority: 19 U.S.C. 66, 1202 (General

Note 20, Harmonized Tariff Schedule of the

United States), 1321, 1481, 1484, 1498, 1508,

1623, 1624, 3314;

* * * * *

§ 10.22 [Removed]

2. Section 10.22 is removed.

PART 102—RULES OF ORIGIN

1. The authority citation for part 102

continues to read as follows:

Authority: 19 U.S.C. 66, 1202 (General

Note 20, Harmonized Tariff Schedule of the

United States), 1624, 3314, 3592.

§§ 102.14 and 102.16 [Removed]

2. Sections 102.14 and 102.16 are

removed and § 102.12 is republished,

and §§ 102.0, 102.1, 102.11, 102.13,

102.15, 102.17, 102.18, 102.19 and

102.20 are revised, to read as follows:

§ 102.0 Scope.

Except in the case of goods covered by

§ 102.21, this part sets forth rules for

determining the country of origin of

imported goods for the purposes

specified in paragraph 1 of Annex 311

of the North American Free Trade

Agreement (‘‘NAFTA’’). These specific

purposes are: country of origin marking;

determining the rate of duty and staging

category applicable to originating textile

and apparel goods as set out in Section

2 (Tariff Elimination) of Annex 300–B

(Textile and Apparel Goods);

determining the rate of duty and staging

category applicable to an originating

good as set out in Annex 302.2 (Tariff

Elimination). The rules for determining

the country of origin of textile and

apparel products set forth in § 102.21

apply for the foregoing purposes and for

the other purposes stated in that section.

Subpart A—General

§ 102.1 Definitions.

(a) Advanced in value. ‘‘Advanced in

value’’ means an increase in the value

of a good as a result of production with

respect to that good, other than by

means of those ‘‘minor processing’’

operations described in paragraphs

(m)(5), (m)(6), and (m)(7) of this section.

(b) Commingled. ‘‘Commingled’’

means physically combined or mixed.

(c) Direct physical identification.

‘‘Direct physical identification’’ means

identification by visual or other

organoleptic examination.

(d) Domestic material. ‘‘Domestic

material’’ means a material whose

country of origin as determined under

these rules is the same country as the

country in which the good is produced.

(e) Foreign material. ‘‘Foreign

material’’ means a material whose

country of origin as determined under

these rules is not the same country as

the country in which the good is

produced.

(f) Fungible goods or fungible

materials. ‘‘Fungible goods or fungible

materials’’ means goods or materials

that are interchangeable for commercial

purposes and whose properties are

essentially identical.

(g) A good wholly obtained or

produced. A good ‘‘wholly obtained or

produced’’ in a country means:

(1) A mineral good extracted in that

country;

(2) A vegetable or plant good

harvested in that country;

(3) A live animal born and raised in

that country;

(4) A good obtained from hunting,

trapping or fishing in that country;

(5) A good (fish, shellfish and other

marine life) taken from the sea by

vessels registered or recorded with that

country and flying its flag;

(6) A good produced on board factory

ships from the goods referred to in

paragraph (g)(5) of this section,

provided such factory ships are

registered or recorded with that country

and fly its flag;

(7) A good taken by that country or a

person of that country from the seabed

or beneath the seabed outside territorial

waters, provided that country has rights

to exploit such seabed;

(8) A good taken from outer space,

provided they are obtained by that

country or a person of that country;

(9) Waste and scrap derived from:

(i) Production in a country, or

(ii) Used goods collected in that

country provided such goods are fit only

for the recovery of raw materials; and

(10) A good produced in that country

exclusively from goods referred to in

paragraphs (g)(1) through (10) of this

section or from their derivatives, at any

stage of production.

(h) Harmonized System. ‘‘Harmonized

System’’ means the Harmonized

Commodity Description and Coding

System, including its general rules of

Interpretation, Section Notes and

Chapter Notes, as adopted and

implemented by the United States.

(i) Improved in condition. ‘‘Improved

in condition’’ means the enhancement

of the physical condition of a good as

a result of production with respect to

that good, other than by means of those

‘‘minor processing’’ operations

described in paragraphs (m)(5), (m)(6),

and (m)(7) of this section.

(j) Incorporated. ‘‘Incorporated’’

means physically incorporated into a

good as a result of production with

respect to that good.

(k) Indirect materials. ‘‘Indirect

materials’’ means a good used in the

production, testing or inspection of

another good but not physically

incorporated into that other good, or a

good used in the maintenance of

buildings or the operation of equipment

associated with the production of that

other good, including:

(1) Fuel and energy;

(2) Tools, dies and molds;

(3) Spare parts and materials used in

the maintenance of equipment and

buildings;

(4) Lubricants, greases, compounding

materials and other materials used in

production or used to operate

equipment and buildings;

(5) Gloves, glasses, footwear, clothing,

safety equipment and supplies;

(6) Equipment, devices, and supplies

used for testing or inspecting the goods;

(7) Catalysts and solvents; and

(8) Any other goods that are not

incorporated into the good but whose

use in the production of the good can

reasonably be demonstrated to be a part

of that production.

(l) Material. ‘‘Material’’ means a good

that is incorporated into another good as

a result of production with respect to

that other good, and includes parts,

ingredients, subassemblies, and

components.

(m) Minor processing. ‘‘Minor

processing’’ means the following:

(1) Mere dilution with water or

another substance that does not

materially alter the characteristics of the

good;

(2) Cleaning, including removal of

rust, grease, paint, or other coatings;

(3) Application of preservative or

decorative coatings, including

lubricants, protective encapsulation,

preservative or decorative paint, or

metallic coatings;

(4) Trimming, filing or cutting off

small amounts of excess materials;

(5) Unloading, reloading or any other

operation necessary to maintain the

good in good condition;

(6) Putting up in measured doses,

packing, repacking, packaging,

repackaging;
28956 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

(7) Testing, marking, sorting, or

grading;

(8) Ornamental or finishing operations

incidental to textile good production

designed to enhance the marketing

appeal or the ease of care of the product,

such as dyeing and printing, embroidery

and appliques, pleating, hemstitching,

stone or acid washing, permanent

pressing, or the attachment of

accessories notions, findings and

trimmings; or

(9) Repairs and alterations, washing,

laundering, or sterilizing.

(n) Production. ‘‘Production’’ means

growing, mining, harvesting, fishing,

trapping, hunting, manufacturing,

processing or assembling a good.

(o) Simple assembly. ‘‘Simple

assembly’’ means the fitting together of

five or fewer parts all of which are

foreign (excluding fasteners such as

screws, bolts, etc.) by bolting, gluing,

soldering, sewing or by other means

without more than minor processing.

(p) Value. ‘‘Value’’ means, with

respect to § 102.13:

(1) In the case of a good, its customs

value or transaction value within the

meaning of the appendix to part 181 of

this chapter; or

(2) In the case of a material, its

customs value or value within the

meaning of the appendix to part 181 of

this chapter.

Subpart B—Rules of Origin

§ 102.11 General rules.

The following rules shall apply for

purposes of determining the country of

origin of imported goods other than

textile and apparel products covered by

§ 102.21.

(a) The country of origin of a good is

the country in which:

(1) The good is wholly obtained or

produced;

(2) The good is produced exclusively

from domestic materials; or

(3) Each foreign material incorporated

in that good undergoes an applicable

change in tariff classification set out in

§ 102.20 and satisfies any other

applicable requirements of that section,

and all other applicable requirements of

these rules are satisfied.

(b) Except for a good that is

specifically described in the

Harmonized System as a set, or is

classified as a set pursuant to General

Rule of Interpretation 3, where the

country of origin cannot be determined

under paragraph (a) of this section:

(1) The country of origin of the good

is the country or countries of origin of

the single material that imparts the

essential character to the good, or

(2) If the material that imparts the

essential character to the good is

fungible, has been commingled, and

direct physical identification of the

origin of the commingled material is not

practical, the country or countries of

origin may be determined on the basis

of an inventory management method

provided under the appendix to part

181 of this chapter.

(c) Where the country of origin cannot

be determined under paragraph (a) or (b)

of this section and the good is

specifically described in the

Harmonized System as a set or mixture,

or classified as a set, mixture or

composite good pursuant to General

Rule of Interpretation 3, the country of

origin of the good is the country or

countries of origin of all materials that

merit equal consideration for

determining the essential character of

the good.

(d) Where the country of origin of a

good cannot be determined under

paragraph (a), (b) or (c) of this section,

the country of origin of the good shall

be determined as follows:

(1) If the good was produced only as

a result of minor processing, the country

of origin of the good is the country or

countries of origin of each material that

merits equal consideration for

determining the essential character of

the good;

(2) If the good was produced by

simple assembly and the assembled

parts that merit equal consideration for

determining the essential character of

the good are from the same country, the

country of origin of the good is the

country of origin of those parts; or

(3) If the country of origin of the good

cannot be determined under paragraph

(d)(1) or (d)(2) of this section, the

country of origin of the good is the last

country in which the good underwent

production.

§ 102.12 Fungible goods.

When fungible goods of different

countries of origin are commingled the

country of origin of the goods:

(a) Is the countries of origin of those

commingled goods; or

(b) If the good is fungible, has been

commingled, and direct physical

identification of the origin of the

commingled good is not practical, the

country or countries of origin may be

determined on the basis of an inventory

management method provided under

the appendix to part 181 of this chapter.

§ 102.13 De Minimis.

(a) Except as otherwise provided in

paragraphs (b) and (c) of this section,

foreign materials that do not undergo

the applicable change in tariff

classification set out in § 102.20 or

satisfy the other applicable

requirements of that section when

incorporated into a good shall be

disregarded in determining the country

of origin of the good if the value of those

materials is no more than 7 percent of

the value of the good or 10 percent of

the value of a good of Chapter 22,

Harmonized System.

(b) Paragraph (a) of this section does

not apply to a foreign material

incorporated in a good provided for in

Chapter 1, 2, 3, 4, 7, 8, 11, 12, 15, 17,

or 20 of the Harmonized System.

(c) Foreign components or materials

that do not undergo the applicable

change in tariff classification set out in

§ 102.21 or satisfy the other applicable

requirements of that section when

incorporated into a textile or apparel

product covered by that section shall be

disregarded in determining the country

of origin of the good if the total weight

of those components or materials is not

more than 7 percent of the total weight

of the good.

§ 102.15 Disregarded materials.

(a) The following materials shall be

disregarded when determining whether

the good undergoes the applicable

change in tariff classification set out in

§ 102.20 or § 102.21, or satisfies the

other applicable requirements of those

sections:

(1) Packaging materials and containers

in which a good is packaged for retail

sale that are classified with the good;

(2) Accessories, spare parts or tools

delivered with the good that are

classified with the good and shipped

with the good;

(3) Packing materials and containers

in which a good is packed for shipment;

and

(4) Indirect materials.

(b) [Reserved]

§ 102.17 Non-qualifying operations.

A foreign material shall not be

considered to have undergone an

applicable change in tariff classification

specified in § 102.20 or § 102.21 or to

have met any other applicable

requirements of those sections merely

by reason of one or more of the

following:

(a) A change in end-use;

(b) Dismantling or disassembly;

(c) Simple packing, repacking or retail

packaging without more than minor

processing;

(d) Mere dilution with water or

another substance that does not

materially alter the characteristics of the

material; or

(e) Collecting parts that, as collected,

are classifiable in the same tariff

provision as an assembled good

pursuant to General Rule of
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28957

Interpretation 2(a), without any

additional operation other than minor

processing.

§ 102.18 Rules of interpretation.

(a) When General Rule of

Interpretation (GRI) 2(a) is referred to in

§ 102.20 as an exception to an allowed

change in tariff classification, this

means that such change will not be

acceptable for purposes of that section

if the change results from the assembly

of parts into an incomplete or

unfinished good which is classifiable in

the same manner as a complete or

finished good pursuant to GRI 2(a).

(b) (1) For purposes of identifying the

material that imparts the essential

character to a good under § 102.11, the

only materials that shall be taken into

consideration are those domestic or

foreign materials that are classified in a

tariff provision from which a change in

tariff classification is not allowed under

the § 102.20 specific rule or other

requirements applicable to the good. For

purposes of this paragraph (b)(1):

(i) The materials to be considered

must be classified in a tariff provision

from which a change in tariff

classification is not allowed under the

specific rule or other requirements

applicable to the good under

consideration. For example, in the case

of a good classified in HTSUS

subheading 8607.11 (the rule for which

specifies a change to subheading

8607.11 from any other subheading,

except from subheading 8607.12, and

except from subheading 8607.19 when

that change is pursuant to GRI 2(a)), the

only materials that may be considered

for purposes of identifying the materials

that impart the essential character to the

good are those that are classified in

subheadings 8607.11, 8607.12 and, if

the tariff shift is pursuant to GRI 2(a),

8607.19;

(ii) Materials that may be considered

include materials produced by the

producer of the good and incorporated

in the good. For example, if a producer

of a good purchases raw materials and

converts those raw materials into a

component that is incorporated in the

good, that component is a material that

may be considered for purposes of

identifying the materials that impart the

essential character to the good, provided

that the component is classified in a

tariff provision from which a change in

tariff classification is not allowed under

the specific rule or other requirements

applicable to the good; and

(iii) If there is only one material that

is classified in a tariff provision from

which a change in tariff classification is

not allowed under the § 102.20 specific

rule or other requirements applicable to

the good, then that material will

represent the single material that

imparts the essential character to the

good under § 102.11.

(2) For purposes of determining

which one of two or more materials

described in paragraph (b)(1) of this

section imparts the essential character

to a good under § 102.11, various factors

may be examined depending upon the

type of good involved. These factors

include, but are not limited to, the

following:

(i) The nature of each material, such

as its bulk, quantity, weight or value;

and

(ii) The role of each material in

relation to the use of the good.

§ 102.19 NAFTA preference override.

(a) Except in the case of goods

covered by paragraph (b) of this section,

if a good which is originating within the

meaning of § 181.1(q) of this chapter is

not determined under § 102.11(a) or (b)

or § 102.21 to be a good of a single

NAFTA country, the country of origin of

such good is the last NAFTA country in

which that good underwent production

other than minor processing, provided

that a Certificate of Origin (see § 181.11

of this chapter) has been completed and

signed for the good.

(b) If, under any other provision of

this part, the country of origin of a good

which is originating within the meaning

of § 181.1(q) of this chapter is

determined to be the United States and

that good has been exported from, and

returned to, the United States after

having been advanced in value or

improved in condition in another

NAFTA country, the country of origin of

such good for Customs duty purposes is

the last NAFTA country in which that

good was advanced in value or

improved in condition before its return

to the United States.

§ 102.20 Specific rules by tariff

classification.

The following rules are the rules

specified in § 102.11(a)(3) and other

sections of this part. Where a rule under

this section permits a change to a

subheading from another subheading of

the same heading, the rule shall be

satisfied only if the change is from a

subheading of the same level specified

in the rule.

HTSUS Tariff shift and/or other requirements

(a) Section I: Chapters 1 through 5

0101–0106 .......................... A change to heading 0101 through 0106 from any other chapter.

0201–0209 .......................... A change to heading 0201 through 0209 from any other chapter.

0210.11–0210.20 ................ A change to subheading 0210.11 through 0210.20 from any other chapter.

0210.90 ............................... A change to subheading 0210.90 from any other chapter; or

A change to edible meals and flours of subheading 0210.90 from any product other than edible meals and flours

of Chapter 2.

0301–0303 .......................... A change to heading 0301 through 0303 from any other chapter.

0304 .................................... A change to heading 0304 from any other chapter; or

A change to fillets of heading 0304 from any other heading.

0305.10 ............................... A change to subheading 0305.10 from any other subheading.

0305.20 ............................... A change to subheading 0305.20 from any other chapter.

0305.30 ............................... A change to subheading 0305.30 from any other subheading, except from fillets of heading 0304.

0305.41–0305.69 ................ A change to subheading 0305.41 through 0305.69 from any other chapter.

0306 .................................... A change to heading 0306 from any other chapter.

0307 .................................... A change to heading 0307 from any other chapter; or

A change to edible meals and flours from within Chapter 3.

0401 .................................... A change to heading 0401 from any other chapter.

0402.10–0402.29 ................ A change to subheading 0402.10 through 0402.29 from any other chapter.

0402.91–0402.99 ................ A change to subheading 0402.91 through 0402.99 from any other chapter.

0403.10 ............................... A change to subheading 0403.10 from any other subheading.

0403.90 ............................... A change to subheading 0403.90 from any other chapter; or

A change to sour cream or kephir from any other product of Chapter 4.
28958 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

0404 .................................... A change to heading 0404 from any other heading.

0405.10 ............................... A change to subheading 0405.10 from any other heading.

0405.20 ............................... A change to subheading 0405.20 from any other chapter, except from subheading 1901.90; or

A change to subheading 0405.20 from any other subheading, provided that the good contains no more than 50

percent by weight of milk solids.

0405.90 ............................... A change to subheading 0405.90 from any other heading.

0406 .................................... A change to heading 0406 from any other heading.

0407–0410 .......................... A change to heading 0407 through 0410 from any other chapter.

0501–0511 .......................... A change to heading 0501 through 0511 from any other chapter.

(b) Section II: Chapters 6 through 14

Note: Notwithstanding the specific rules of this section, an agricultural or horticultural good grown in the territory of a country shall be treated

as a good of that country even if grown from seed or bulbs, root stock, cuttings, slips or other live parts of plants, or from whole plants, imported from a foreign country.

0601–0602 .......................... A change to heading 0601 through 0602 from any other heading, including another heading within that group.

0603–0604 .......................... A change to heading 0603 through 0604 from any other heading, including another heading within that group, except from heading 0602.

0701–0709 .......................... A change to heading 0701 through 0709 from any other chapter.

0710 .................................... A change to heading 0710 from any other chapter.

0711 .................................... A change to heading 0711 from any other chapter.

0712 .................................... A change to heading 0712 from any other chapter; or

A change to powdered vegetables of heading 0712 from any other product of Chapter 7, if put up for retail sale.

0713–0714 .......................... A change to heading 0713 through 0714 from any other chapter.

0801–0810 .......................... A change to heading 0801 through 0810 from any other chapter.

0811 .................................... A change to heading 0811 from any other chapter.

0812 .................................... A change to heading 0812 from any other chapter.

0813 .................................... A change to heading 0813 from any other chapter.

0814 .................................... A change to heading 0814 from any other chapter.

0901.11–0901.12 ................ A change to subheading 0901.11 through 0901.12 from any other chapter.

0901.21–0901.22 ................ A change to subheading 0901.21 through 0901.22 from any subheading outside that group.

0901.90 ............................... A change to subheading 0901.90 from any other chapter.

0902–0903 .......................... A change to heading 0902 through 0903 from any other chapter.

0904–0910 .......................... A change to heading 0904 through 0910 from any other chapter; or

A change to crushed, ground, or powdered products of heading 0904 through 0910 from within Chapter 9, if put

up for retail sale; or

A change to subheading 0910.91 from any other subheading, provided that a single spice ingredient of foreign origin constitutes no more than 60 percent by weight of the good.

1001–1008 .......................... A change to heading 1001 through 1008 from any other chapter.

1101–1106 .......................... A change to heading 1101 through 1106 from any other chapter.

1107 .................................... A change to heading 1107 from any other chapter.

1108–1109 .......................... A change to heading 1108 through 1109 from any other heading, including another heading within that group.

1201–1207 .......................... A change to heading 1201 through 1207 from any other chapter.

1208 .................................... A change to heading 1208 from any other heading.

1209–1214 .......................... A change to heading 1209 through 1214 from any other chapter.

1301–1302 .......................... A change to heading 1301 through 1302 from any other chapter.

1401–1404 .......................... A change to heading 1401 through 1404 from any other chapter.

(c) Section III: Chapter 15

1501–1516 .......................... A change to heading 1501 through 1516 from any other chapter.

1517.10 ............................... A change to subheading 1517.10 from any other heading.

1517.90 ............................... A change to subheading 1517.90 from any other chapter, except from heading 3823; or

A change to subheading 1517.90 from any other heading, provided that no single oil ingredient of foreign origin

constitutes more than 60 percent by weight of the good.

1518 .................................... A change to heading 1518 from any other heading.

1520 .................................... A change to heading 1520 from any other heading, except from subheading 2905.45 and heading 3823.

1521–1522 .......................... A change to heading 1521 through 1522 from any other chapter, except from heading 3823.

(d) Section IV: Chapters 16 through 24

1601–1605 .......................... A change to heading 1601 through 1605 from any other chapter.

1701–1702 .......................... A change to heading 1701 through 1702 from any other chapter.

1703 .................................... A change to heading 1703 from any other chapter.

1704 .................................... A change to heading 1704 from any other heading.

1801–1803 .......................... A change to heading 1801 through 1803 from any other chapter.

1804 .................................... A change to heading 1804 from any other heading, except from heading 1803.

1805 .................................... A change to heading 1805 from any other heading, except from subheading 1803.20.

1806.10 ............................... A change to subheading 1806.10 from any other heading, except from heading 1805 or from Chapter 17; or

A change to subheading 1806.10 from Chapter 17, provided that the good contains less than 65 percent by dry

weight of sugar.

1806.20 ............................... A change to subheading 1806.20 from any other heading, except from Chapter 17; or
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28959

HTSUS Tariff shift and/or other requirements

A change to subheading 1806.20 from Chapter 17, provided that the good contains less than 65 percent by dry

weight of sugar.

1806.31 ............................... A change to subheading 1806.31 from any other subheading.

1806.32 ............................... A change to subheading 1806.32 from any other subheading.

1806.90 ............................... A change to subheading 1806.90 from any other subheading.

1901.10 ............................... A change to subheading 1901.10 from any other subheading.

1901.20 ............................... A change to subheading 1901.20 from any other subheading.

1901.90 ............................... A change to subheading 1901.90 from any other heading.

1902.11–1902.19 ................ A change to subheading 1902.11 through 1902.19 from any other heading.

1902.20 ............................... A change to subheading 1902.20 from any other subheading.

1902.30–1902.40 ................ A change to subheading 1902.30 through 1902.40 from any other heading.

1903 .................................... A change to heading 1903 from any other heading.

1904.10 ............................... A change to subheading 1904.10 from any other heading.

1904.20 ............................... A change to subheading 1904.20 from any other subheading.

1904.90 ............................... A change to subheading 1904.90 from any other heading.

1905 .................................... A change to heading 1905 from any other heading.

Chapter 20 Note: Notwithstanding the specific rules of this chapter, fruit, nut and vegetable preparations of Chapter 20 that have been prepared or preserved merely by freezing, by packing (including canning) in water, brine or natural juices, or by roasting, either dry or in oil (including processing incidental to freezing, packing, or roasting), shall be treated as a good of the country in which the fresh good was produced.

2001–2007 .......................... A change to heading 2001 through 2007 from any other chapter.

2008.11 ............................... A change to subheading 2008.11 from any other chapter, provided that the change is not the result of mere

blanching of peanuts.

2008.19–2008.99 ................ A change to subheading 2008.19 through 2008.99 from any other chapter, provided that the change is not the result of mere blanching of nuts.

2009.11–2009.30 ................ A change to subheading 2009.11 through 2009.30 from any other chapter.

2009.40–2009.80 ................ A change to subheading 2009.40 through 2009.80 from any other chapter.

2009.90 ............................... A change to subheading 2009.90 from any other chapter; or

A change to subheading 2009.90 from any other subheading, provided that a single juice ingredient of foreign origin, or juice ingredients from a single foreign country, constitute in single strength form no more than 60 percent

by volume of the good.

2101 .................................... A change to heading 2101 from any other heading.

2102 .................................... A change to heading 2102 from any other heading.

2103.10 ............................... A change to subheading 2103.10 from any other heading.

2103.20 ............................... A change to subheading 2103.20 from any other heading.

2103.30 ............................... A change to subheading 2103.30 from any other subheading; or

A change to prepared mustard of subheading 2103.30 from mustard flour or meal.

2103.90 ............................... A change to subheading 2103.90 from any other subheading.

2104.10 ............................... A change to subheading 2104.10 from any other subheading.

2104.20 ............................... A change to subheading 2104.20 from any other subheading.

2105 .................................... A change to heading 2105 from any other heading.

2106.10 ............................... A change to subheading 2106.10 from any other subheading.

2106.90 ............................... A change to a good of subheading 2106.90, other than to compound alcoholic preparations, from any other subheading, except from Chapter 4, Chapter 17, heading 2009, subheading 1901.90 or subheading 2202.90; or

A change to subheading 2106.90 from Chapter 4 or subheading 1901.90, provided that the good contains no more

than 50 percent by weight of milk solids; or

A change to subheading 2106.90 from Chapter 17, provided that the good contains less than 65 percent by dry

weight of sugar; or

A change to subheading 2106.90 from heading 2009 or subheading 2202.90, provided that a single juice ingredient of foreign origin, or juice ingredients from a single foreign country, constitute in single strength form no more

than 60 percent by volume of the good; or

A change to compound alcoholic preparations of subheading 2106.90 from any other subheading, except from

subheading 2208.20 through 2208.50.

2201 .................................... A change to heading 2201 from any other chapter.

2202.10 ............................... A change to sweetened and/or flavored waters of subheading 2202.10 from any other chapter; or

A change to other beverages of subheading 2202.10 from any other heading.

2202.90 ............................... A change to subheading 2202.90 from any other subheading, except from Chapter 4 or heading 1901, 2009, or

2106; or

A change to subheading 2202.90 from Chapter 4 or heading 1901, provided that the good contains no more than

50 percent by weight of milk solids; or

A change to subheading 2202.90 from heading 2009 or subheading 2106.90, provided that a single juice ingredient of foreign origin, or juice ingredients from a single foreign country, constitute in single strength form no more

than 60 percent by volume of the good.

2203 .................................... A change to heading 2203 from any other heading.

2204.10–2204.29 ................ A change to subheading 2204.10 through 2204.29 from any other subheading outside that group.

2204.30 ............................... A change to subheading 2204.30 from any other heading.

2205 .................................... A change to heading 2205 from any other heading, except from heading 2204; or

A change to vermouth of heading 2205 from heading 2204.

2206 .................................... A change to heading 2206 from any other heading.

2207 .................................... A change to heading 2207 from any other heading, except from compound alcoholic preparations of subheading

2106.90 or heading 2208.

2208.20–2208.70 ................ A change to subheading 2208.20 through 2208.70 from any other subheading outside that group, except from

subheading 2106.90; or
28960 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

A change to liqueurs or cordials of subheading 2208.70 from any other product.

2208.90 ............................... A change to subheading 2208.90 from any other subheading, except from subheading 2106.90; or

A change to kirschwasser or ratafia of subheading 2208.90 from any other product.

2209 .................................... A change to heading 2209 from any other heading.

2301–2308 .......................... A change to heading 2301 through 2308 from any other chapter.

2309.10 ............................... A change to subheading 2309.10 from any other heading.

2309.90 ............................... A change to subheading 2309.90 from any other heading, except from Chapter 4 or heading 1901; or

A change to subheading 2309.90 from Chapter 4 or heading 1901, provided that the good contains no more than

50 percent by weight of milk solids.

2401 .................................... A change to heading 2401 from any other chapter.

2402–2403 .......................... A change to heading 2402 through 2403 from any other heading, including another heading within that group.

(e) Section V: Chapters 25 through 27

2501–2516 .......................... A change to heading 2501 through 2516 from any other heading, including another heading within that group.

2517.10–2517.20 ................ A change to subheading 2517.10 through 2517.20 from any other heading.

2517.30 ............................... A change to subheading 2517.30 from any other subheading.

2517.41–2517.49 ................ A change to subheading 2517.41 through 2517.49 from any other heading.

2518–2530 .......................... A change to heading 2518 through 2530 from any other heading, including another heading within that group.

2601–2621 .......................... A change to heading 2601 through 2621 from any other heading, including another heading within that group.

Chapter 27 Note: For purposes of this chapter, a ‘‘chemical reaction’’ is defined as a process in which chemical bonds in molecules are broken and new chemical bonds are formed between the fragmented molecules and/or added elements so that one or more of the original bond/s

no longer link the same chemical element/s or functional group/s.

2701–2706 .......................... A change to heading 2701 through 2706 from any other heading, including any heading within that group.

2707.10–2707.99 ................ A change to subheading 2707.10 through 2707.99 from any other heading; or

A change to subheading 2707.10 through 2707.99 from any other subheading, including any subheading within

that group, provided that the good resulting from such change is the product of a chemical reaction.

2708–2709 .......................... A change to heading 2708 through 2709 from any other heading, including another heading within that group.

2710 .................................... A change to heading 2710 from any other heading; or

A change to any good of heading 2710 from any other good of heading 2710, provided that the good resulting

from such change is the product of a chemical reaction.

2711.11 ............................... A change to subheading 2711.11 from any other subheading, except from subheading 2711.21.

2711.12–2711.19 ................ A change to subheading 2711.12 through 2711.19 from any other subheading, including another subheading within that group, except from subheading 2711.29.

2711.21 ............................... A change to subheading 2711.21 from any other subheading, except from subheading 2711.11.

2711.29 ............................... A change to subheading 2711.29 from any other subheading, except from subheading 2711.12 through 2711.21.

2712–2714 .......................... A change to heading 2712 through 2714 from any other heading, including another heading within that group.

2715 .................................... A change to heading 2715 from any other heading, except from heading 2714 or subheading 2713.20.

2716 .................................... A change to heading 2716 from any other heading.

(f) Section VI: Chapters 28 through 38

Notes: 1. Chemical reaction origin rule—

Any good of Chapters 28, 29, 31, 32 or 38, except a good of heading 3823, that is the product of a chemical reaction shall be considered to

be a good of the country in which the reaction occurred.

A chemical reaction is defined as a process in which chemical bonds in molecules are broken and new chemical bonds are formed between

the fragmented molecules and/or added elements so that one or more of the original bonds no longer link the same chemical element/s or functional group/s.

Notwithstanding any of the line-by-line rules, the ‘‘chemical reaction’’ rule may be applied to any good classified in the above chapters.

2. Separation prohibition—

A foreign material/component will not be deemed to have satisfied all applicable requirements of these rules by reason of a change from one

classification to another merely as the result of the separation of one or more individual materials or components from a man-made mixture unless the isolated material/component, itself, also underwent a chemical reaction.

2801.10–2801.30 ................ A change to subheading 2801.10 through 2801.30 from any other subheading, including another subheading within that group.

2802 .................................... A change to heading 2802 from any other heading, except from heading 2503.

2803 .................................... A change to heading 2803 from any other heading.

2804.10–2804.50 ................ A change to subheading 2804.10 through 2804.50 from any other subheading, including another subheading within that group.

2804.61–2804.69 ................ A change to subheading 2804.61 through 2804.69 from any other subheading outside that group.

2804.70–2804.90 ................ A change to subheading 2804.70 through 2804.90 from any other subheading, including another subheading within that group.

2805 .................................... A change to heading 2805 from any other heading.

2806.10–2806.20 ................ A change to subheading 2806.10 through 2806.20 from any other subheading,

including another subheading within that group..

2807–2808 .......................... A change to heading 2807 through 2808 from any other heading, including another heading within that group.

2809.10–2809.20 ................ A change to subheading 2809.10 through 2809.20 from any other subheading, including another subheading within that group.

2810 .................................... A change to heading 2810 from any other heading.

2811.11 ............................... A change to subheading 2811.11 from any other subheading.
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HTSUS Tariff shift and/or other requirements

2811.19 ............................... A change to subheading 2811.19 from any other subheading, except from subheading 2811.22.

2811.21 ............................... A change to subheading 2811.21 from any other subheading.

2811.22 ............................... A change to subheading 2811.22 from any other subheading, except from subheading 2505.10, 2506.10, or

2811.19.

2811.23–2811.29 ................ A change to subheading 2811.23 through 2811.29 from any other subheading, including another subheading within that group.

2812.10–2813.90 ................ A change to subheading 2812.10 through 2813.90 from any other subheading, including another subheading within that group.

2814 .................................... A change to heading 2814 from any other heading.

2815.11–2815.12 ................ A change to subheading 2815.11 through 2815.12 from any other subheading outside that group.

2815.20–2815.30 ................ A change to subheading 2815.20 through 2815.30 from any other subheading, including another subheading within that group.

2816.10 ............................... A change to subheading 2816.10 from any other subheading.

2816.20 ............................... A change to subheading 2816.20 from any other subheading, except from subheading 2530.90.

2816.30 ............................... A change to subheading 2816.30 from any other subheading.

2817 .................................... A change to heading 2817 from any other heading, except from heading 2608.

2818.10–2818.30 ................ A change to subheading 2818.10 through 2818.30 from any other subheading, including another subheading within that group, except from heading 2606 or subheading 2620.40.

2819.10–2819.90 ................ A change to subheading 2819.10 through 2819.90 from any other subheading, including another subheading within that group.

2820.10–2820.90 ................ A change to subheading 2820.10 through 2820.90 from any other subheading, including another subheading within that group, except from subheading 2530.90 or heading 2602.

2821.10 ............................... A change to subheading 2821.10 from any other subheading.

2821.20 ............................... A change to subheading 2821.20 from any other subheading, except from subheading 2530.30 or 2601.11 through

2601.20.

2822 .................................... A change to heading 2822 from any other heading, except from heading 2605.

2823 .................................... A change to heading 2823 from any other heading.

2824.10–2824.90 ................ A change to subheading 2824.10 through 2824.90 from any other subheading, including another subheading within that group, except from heading 2607.

2825.10–2825.40 ................ A change to subheading 2825.10 through 2825.40 from any other subheading, including another subheading within that group.

2825.50 ............................... A change to subheading 2825.50 from any other subheading, except from heading 2603.

2825.60 ............................... A change to subheading 2825.60 from any other subheading, except from subheading 2615.10.

2825.70 ............................... A change to subheading 2825.70 from any other subheading, except from subheading 2613.10.

2825.80 ............................... A change to subheading 2825.80 from any other subheading, except from subheading 2617.10.

2825.90 ............................... A change to subheading 2825.90 from any other subheading, provided that the good classified in subheading

2825.90 is the product of a ‘‘chemical reaction’’ as defined in Note 1.

2826.11–2833.19 ................ A change to subheading 2826.11 through 2833.19 from any other subheading, including another subheading within that group.

2833.21 ............................... A change to subheading 2833.21 from any other subheading, except from subheading 2530.20.

2833.22–2833.26 ................ A change to subheading 2833.22 through 2833.26 from any other subheading, including another subheading within that group.

2833.27 ............................... A change to subheading 2833.27 from any other subheading, except from subheading 2511.10.

2833.29 ............................... A change to subheading 2833.29 from any other subheading, except from heading 2520.

2833.30–2833.40 ................ A change to subheading 2833.30 through 2833.40 from any other subheading, including another subheading within that group.

2834.10–2834.29 ................ A change to subheading 2834.10 through 2834.29 from any other subheading, including another subheading within that group.

2835.10–2835.25 ................ A change to subheading 2835.10 through 2835.25 from any other subheading, including another subheading within that group.

2835.26 ............................... A change to subheading 2835.26 from any other subheading, except from heading 2510.

2835.29–2835.39 ................ A change to subheading 2835.29 through 2835.39 from any other subheading, including another subheading within that group.

2836.10 ............................... A change to subheading 2836.10 from any other subheading.

2836.20 ............................... A change to subheading 2836.20 from any other subheading, except from subheading 2530.90.

2836.30–2836.40 ................ A change to subheading 2836.30 through 2836.40 from any other subheading, including another subheading within that group.

2836.50 ............................... A change to subheading 2836.50 from any other subheading, except from heading 2509, subheading 2517.41 or

2517.49, heading 2521, or subheading 2530.90.

2836.60 ............................... A change to subheading 2836.60 from any other subheading, except from subheading 2511.20.

2836.70 ............................... A change to subheading 2836.70 from any other subheading, except from heading 2607.

2836.91 ............................... A change to subheading 2836.91 from any other subheading.

2836.92 ............................... A change to subheading 2836.92 from any other subheading, except from subheading 2530.90.

2836.99 ............................... A change to bismuth carbonate of subheading 2836.99 from any other subheading, except from subheading

2617.90; or

A change to subheading 2836.99 from any other subheading, provided that the good classified in subheading

2836.99 is the product of a ‘‘chemical reaction’’ as defined in Note 1.

2837.11–2837.20 ................ A change to subheading 2837.11 through 2837.20 from any other subheading, including another subheading within that group.

2838 .................................... A change to heading 2838 from any other heading.

2839.11–2839.19 ................ A change to subheading 2839.11 through 2839.19 from any other subheading outside that group.

2839.20–2839.90 ................ A change to subheading 2839.20 through 2839.90 from any other subheading, including another subheading within that group.
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2840.11–2840.20 ................ A change to subheading 2840.11 through 2840.20 from any other subheading outside that group, except from

subheading 2528.10.

2840.30 ............................... A change to subheading 2840.30 from any other subheading.

2841.10–2841.40 ................ A change to subheading 2841.10 through 2841.40 from any other subheading, including another subheading within that group.

2841.50 ............................... A change to subheading 2841.50 from any other subheading, except from heading 2610.

2841.61–2841.69 ................ A change to subheading 2841.61 through 2841.69 from any other subheading outside that group.

2841.70 ............................... A change to subheading 2841.70 from any other subheading, except from subheading 2613.90.

2841.80 ............................... A change to subheading 2841.80 from any other subheading, except from heading 2611.

2841.90 ............................... A change to subheading 2841.90 from any other subheading, provided that the good classified in subheading

2841.90 is the product of a ‘‘chemical reaction’’ as defined in Note 1.

2842.10 ............................... A change to subheading 2842.10 from any other subheading.

2842.90 ............................... A change to subheading 2842.90 from any other subheading, provided that the good classified in subheading

2842.90 is the product of a ‘‘chemical reaction’’ as defined in Note 1.

2843.10 ............................... A change to subheading 2843.10 from any other subheading, except from heading 7106, 7108, 7110, or 7112.

2843.21–2843.29 ................ A change to subheading 2843.21 through 2843.29 from any other subheading, including another subheading within that group.

2843.30–2843.90 ................ A change to subheading 2843.30 through 2843.90 from any other subheading, including another subheading within that group, except from subheading 2616.90.

2844.10 ............................... A change to subheading 2844.10 from any other subheading, except from subheading 2612.10.

2844.20 ............................... A change to subheading 2844.20 from any other subheading.

2844.30 ............................... A change to subheading 2844.30 from any other subheading, except from subheading 2844.20.

2844.40–2844.50 ................ A change to subheading 2844.40 through 2844.50 from any other subheading, including another subheading within that group.

2845 .................................... A change to heading 2845 from any other heading.

2846 .................................... A change to heading 2846 from any other heading, except from subheading 2530.90.

2847 .................................... A change to heading 2847 from any other heading.

2848 .................................... A change to heading 2848 from any other heading.

2849.10–2849.90 ................ A change to subheading 2849.10 through 2849.90 from any other subheading, including another subheading within that group.

2850–2851 .......................... A change to heading 2850 through 2851 from any other heading, including another heading within that group.

2901.10–2901.90 ................ A change to subheading 2901.10 through 2901.90 from any other subheading, including another subheading within that group, except from acyclic petroleum oils of heading 2710 or from subheading 2711.13, 2711.14,

2711.19, or 2711.29.

2902.11 ............................... A change to subheading 2902.11 from any other subheading.

2902.19 ............................... A change to subheading 2902.19 from any other subheading, except from non-aromatic cyclic petroleum oils of

subheading 2707.50, 2707.99, or heading 2710.

2902.20 ............................... A change to subheading 2902.20 from any other subheading, except from subheading 2707.10, 2707.50, or

2707.99.

2902.30 ............................... A change to subheading 2902.30 from any other subheading, except from subheading 2707.20, 2707.50, or

2707.99.

2902.41–2902.44 ................ A change to subheading 2902.41 through 2902.44 from any other subheading, including another subheading within that group, except from subheading 2707.30, 2707.50 or 2707.99.

2902.50 ............................... A change to subheading 2902.50 from any other subheading.

2902.60 ............................... A change to subheading 2902.60 from any other subheading, except from subheading 2707.30, 2707.50, 2707.99,

or heading 2710.

2902.70–2902.90 ................ A change to subheading 2902.70 through 2902.90 from any other subheading, including another subheading within that group, except from subheading 2707.50, 2707.99, or heading 2710.

2903.11–2903.30 ................ A change to subheading 2903.11 through 2903.30 from any other subheading, including another subheading within that group.

2903.41–2903.49 ................ A change to subheading 2903.41 through 2903.49 from any other subheading outside that group.

2903.51–2904.90 ................ A change to subheading 2903.51 through 2904.90 from any other subheading, including another subheading within that group.

2905.11–2905.19 ................ A change to subheading 2905.11 through 2905.19 from any other subheading, including another subheading within that group.

2905.22–2905.29 ................ A change to subheading 2905.22 through 2905.29 from any other subheading, including another subheading within that group, except from subheading 1301.90, 3301.90, or 3805.90.

2905.31–2905.44 ................ A change to subheading 2905.31 through 2905.44 from any other subheading, including another subheading within that group.

2905.45 ............................... A change to subheading 2905.45 from any other subheading, except from heading 1520.

2905.49–2905.50 ................ A change to subheading 2905.49 through 2905.50 from any other subheading, including another subheading within that group.

2906.11 ............................... A change to subheading 2906.11 from any other subheading, except from subheading 3301.24 or 3301.25.

2906.12–2906.13 ................ A change to subheading 2906.12 through 2906.13 from any other subheading, including another subheading within that group.

2906.14 ............................... A change to subheading 2906.14 from any other subheading, except from heading 3805.

2906.19 ............................... A change to subheading 2906.19 from any other subheading, except from subheading 3301.90 or 3805.90.

2906.21 ............................... A change to subheading 2906.21 from any other subheading.

2906.29 ............................... A change to subheading 2906.29 from any other subheading, except from subheading 2707.60 or 3301.90.

2907.11 ............................... A change to subheading 2907.11 from any other subheading, except from subheading 2707.60.

2907.12–2907.22 ................ A change to subheading 2907.12 through 2907.22 from any other subheading, including another subheading within that group, except from subheading 2707.99.

2907.23 ............................... A change to subheading 2907.23 from any other subheading.
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HTSUS Tariff shift and/or other requirements

2907.29–2907.30 ................ A change to subheading 2907.29 through 2907.30 from any other subheading, including another subheading within that group, except from subheading 2707.99.

2908 .................................... A change to heading 2908 from any other heading.

2909.11–2909.49 ................ A change to subheading 2909.11 through 2909.49 from any other subheading, including another subheading within that group.

2909.50 ............................... A change to subheading 2909.50 from any other subheading, except from subheading 3301.90.

2909.60 ............................... A change to subheading 2909.60 from any other subheading.

2910.10–2910.90 ................ A change to subheading 2910.10 through 2910.90 from any other subheading, including another subheading within that group.

2911 .................................... A change to heading 2911 from any other heading.

2912.11–2912.13 ................ A change to subheading 2912.11 through 2812.13 from any other subheading, including another subheading within that group.

2912.19–2912.49 ................ A change to subheading 2912.19 through 2912.49 from any other subheading, including another subheading within that group, except from subheading 3301.90.

2912.50–2912.60 ................ A change to subheading 2912.50 through 2912.60 from any other subheading, including another subheading within that group.

2913 .................................... A change to heading 2913 from any other heading.

2914.11–2914.19 ................ A change to subheading 2914.11 through 2914.19 from any other subheading, including another subheading within that group, except from subheading 3301.90.

2914.21–2914.22 ................ A change to subheading 2914.21 through 2914.22 from any other subheading, including another subheading within that group.

2914.23 ............................... A change to subheading 2914.23 from any other subheading, except from subheading 3301.90.

2914.29 ............................... A change to subheading 2914.29 from any other subheading, except from subheading 3301.90 or 3805.90.

2914.31–2914.39 ................ A change to subheading 2914.31 through 2914.39 from any other subheading outside that group, except from

subheading 3301.90.

2914.40–2914.70 ................ A change to subheading 2914.40 through 2914.70 from any other subheading, including another subheading within that group, except from subheading 3301.90.

2915.11–2915.35 ................ A change to subheading 2915.11 through 2915.35 from any other subheading, including another subheading within that group.

2915.39 ............................... A change to subheading 2915.39 from any other subheading, except from subheading 3301.90.

2915.40–2915.90 ................ A change to subheading 2915.40 through 2915.90 from any other subheading, including another subheading within that group.

2916.11–2916.20 ................ A change to subheading 2916.11 through 2916.20 from any other subheading, including another subheading within that group.

2916.31–2916.39 ................ A change to subheading 2916.31 through 2916.39 from any other subheading, including another subheading within that group, except from subheading 3301.90.

2917.11–2917.39 ................ A change to subheading 2917.11 through 2917.39 from any other subheading, including another subheading within that group.

2918.11–2918.22 ................ A change to subheading 2918.11 through 2918.22 from any other subheading, including another subheading within that group.

2918.23 ............................... A change to subheading 2918.23 from any other subheading, except from subheading 3301.90.

2918.29–2918.30 ................ A change to subheading 2918.29 through 2918.30 from any other subheading, including another subheading within that group.

2918.90 ............................... A change to subheading 2918.90 from any other subheading, except from heading 3301.90.

2919 .................................... A change to heading 2919 from any other heading.

2920.10–2926.90 ................ A change to subheading 2920.10 through 2926.90 from any other subheading, including another subheading within that group.

2927–2928 .......................... A change to heading 2927 through 2928 from any other heading, including another heading within that group.

2929.10–2930.90 ................ A change to subheading 2929.10 through 2930.90 from any other subheading, including another subheading within that group.

2931 .................................... A change to heading 2931 from any other heading.

2932.11–2932.99 ................ A change to subheading 2932.11 through 2932.99 from any other subheading, including another subheading within that group, except from subheading 3301.90.

2933.11–2934.90 ................ A change to subheading 2933.11 through 2934.90 from any other subheading, including another subheading within that group.

2935 .................................... A change to heading 2935 from any other heading.

2936.10–2936.29 ................ A change to subheading 2936.10 through 2936.29 from any other subheading, including another subheading within that group.

2936.90 ............................... A change to subheading 2936.90 from any other subheading, except from subheading 2936.10 through 2936.29.

2937–2941 .......................... A change to heading 2937 through 2941 from any other heading, including another heading within that group.

2942 .................................... A change to heading 2942 from any other chapter.

3001.10 ............................... A change to subheading 3001.10 from any other subheading, except from subheading 0206.10 through 0208.90 or

0305.20, heading 0504 or 0510, or subheading 0511.99 if the change from these provisions is not to a powder

classified in subheading 3001.10.

3001.20–3001.90 ................ A change to subheading 3001.20 through 3001.90 from any other subheading, including another subheading within that group.

3002.10–3002.90 ................ A change to subheading 3002.10 through 3002.90 from any other subheading, including another subheading within that group.

3002.90 ............................... A change to subheading 3002.90 from any other subheading.

3003.10 ............................... A change to subheading 3003.10 from any other subheading, except from subheading 2941.10, 2941.20, or

3003.20.

3003.20 ............................... A change to subheading 3003.20 from any other subheading, except from subheading 2941.30 through 2941.90.

3003.31 ............................... A change to subheading 3003.31 from any other subheading, except from subheading 2937.91.
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3003.39 ............................... A change to subheading 3003.39 from any other subheading, except from hormones or their derivatives classified

in Chapter 29.

3003.40 ............................... A change to subheading 3003.40 from any other subheading, except from heading 1211, subheading 1302.11,

1302.19, 1302.20, or 1302.39 or alkaloids or derivatives thereof classified in Chapter 29.

3003.90 ............................... A change to subheading 3003.90 from any other subheading, provided that the domestic content of the therapeutic or prophylactic component is no less than 40 percent by weight of the total therapeutic or prophylactic

content.

3004.10 ............................... A change to subheading 3004.10 from any other subheading, except from subheading 2941.10, 2941.20, 3003.10,

or 3003.20.

3004.20 ............................... A change to subheading 3004.20 from any other subheading, except from subheading 2941.30 through 2941.90 or

3003.20.

3004.31 ............................... A change to subheading 3004.31 from any other subheading, except from subheading 2937.91, 3003.31, or

3003.39.

3004.32 ............................... A change to subheading 3004.32 from any other subheading, except from subheading 3003.39 or adrenal cortical

hormones classified in Chapter 29.

3004.39 ............................... A change to subheading 3004.39 from any other subheading, except from subheading 3003.39 or hormones or

derivatives thereof classified in Chapter 29.

3004.40 ............................... A change to subheading 3004.40 from any other subheading, except from heading 1211, subheading 1302.11,

1302.19, 1302.20, 1302.39, or 3003.40 or alkaloids or derivatives thereof classified in Chapter 29.

3004.50 ............................... A change to subheading 3004.50 from any other subheading, except from subheading 3003.90 or vitamins classified in Chapter 29 or products classified in heading 2936.

3004.90 ............................... A change to subheading 3004.90 from any other subheading, except from subheading 3003.90, and provided that

the domestic content of the therapeutic or prophylactic component is no less than 40 percent by weight of the

total therapeutic or prophylactic content.

3005.10 ............................... A change to subheading 3005.10 from any other subheading.

3006.10 ............................... A change to subheading 3006.10 from any other subheading, except from subheading 1212.20 or 4206.10.

3006.20–3006.60 ................ A change to subheading 3006.20 through 3006.60 from any other subheading, including another subheading within that group.

3101 .................................... A change to heading 3101 from any other heading, except from subheading 2301.20 or from powders and meals

of subheading 0506.90, heading 0508, or subheading 0511.91 or 0511.99.

3102.10–3102.21 ................ A change to subheading 3102.10 through 3102.21 from any other subheading, including another subheading within that group.

3102.29 ............................... A change to subheading 3102.29 from any other subheading, except from subheading 3102.21 or 3102.30.

3102.30 ............................... A change to subheading 3102.30 from any other subheading.

3102.40 ............................... A change to subheading 3102.40 from any other subheading, except from subheading 3102.30.

3102.50 ............................... A change to subheading 3102.50 from any other subheading.

3102.60 ............................... A change to subheading 3102.60 from any other subheading, except from subheading 2834.29 or 3102.30.

3102.70 ............................... A change to subheading 3102.70 from any other subheading.

3102.80 ............................... A change to subheading 3102.80 from any other subheading, except from subheading 3102.10 or 3102.30.

3102.90 ............................... A change to subheading 3102.90 from any other subheading, except from subheading 3102.10 through 3102.80.

3103.10–3103.20 ................ A change to subheading 3103.10 through 3103.20 from any other subheading, including another subheading within that group.

3103.90 ............................... A change to subheading 3103.90 from any other subheading, except from subheading 3103.10 or 3103.20.

3104.10–3104.30 ................ A change to subheading 3104.10 through 3104.30 from any other subheading, including another subheading within that group.

3104.90 ............................... A change to subheading 3104.90 from any other subheading, except from subheading 3104.10 through 3104.30.

3105.10 ............................... A change to subheading 3105.10 from any other subheading, except from Chapter 31.

3105.20 ............................... A change to subheading 3105.20 from any other heading, except from heading 3102 through 3104.

3105.30–3105.40 ................ A change to subheading 3105.30 through 3105.40 from any other subheading, including another subheading within that group.

3105.51–3105.59 ................ A change to subheading 3105.51 through 3105.59 from any other subheading, including another subheading within that group, except from subheading 3102.10 through 3103.90 or 3105.30 through 3105.40.

3105.60 ............................... A change to subheading 3105.60 from any other subheading, except from heading 3103 through 3104.

3105.90 ............................... A change to subheading 3105.90 from any other chapter, except from subheading 2834.21.

3201.10–3202.90 ................ A change to subheading 3201.10 through 3202.90 from any other subheading, including another subheading within that group.

3203 .................................... A change to heading 3203 from any other heading.

3204.11–3204.17 ................ A change to subheading 3204.11 through 3204.17 from any other subheading, including another subheading within that group.

3204.19 ............................... A change to subheading 3204.19 from any other subheading, except from subheading 3204.11 through 3204.17.

3204.20–3204.90 ................ A change to subheading 3204.20 through 3204.90 from any other subheading, including another subheading within that group.

3205 .................................... A change to heading 3205 from any other heading.

3206.11–3206.19 ................ A change to subheading 3206.11 through 3206.19 from any other subheading outside that group.

3206.20–3209.90 ................ A change to subheading 3206.20 through 3209.90 from any other subheading, including another subheading within that group.

3210 .................................... A change to heading 3210 from any other heading.

3211 .................................... A change to heading 3211 from any other heading, except from subheading 3806.20.

3212.10–3212.90 ................ A change to subheading 3212.10 through 3212.90 from any other subheading, including another subheading within that group.

3213 .................................... A change to heading 3213 from any other heading.

3214.10–3214.90 ................ A change to subheading 3214.10 through 3214.90 from any other subheading, including another subheading within that group, except from subheading 3824.50.

3215 .................................... A change to heading 3215 from any other heading.
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HTSUS Tariff shift and/or other requirements

3301.11–3301.90 ................ A change to subheading 3301.11 through 3301.90 from any other subheading, including another subheading within that group.

3302 .................................... A change to heading 3302 from any other heading, except from subheading 2106.90 or heading 2207, 2208, or

3301.

3303 .................................... A change to heading 3303 from any other heading, except from subheading 3302.90.

3304.10–3306.10 ................ A change to subheading 3304.10 through 3306.10 from any other subheading, including another subheading within that group.

3306.20 ............................... A change to subheading 3306.20 from any other subheading, except from Chapter 54.

3306.90–3307.90 ................ A change to subheading 3306.90 through 3307.90 from any other subheading, including another subheading within that group.

3401 .................................... A change to heading 3401 from any other heading.

3402.11 ............................... A change to subheading 3402.11 from any other subheading, except from subheading 3817.10.

3402.12–3402.20 ................ A change to subheading 3402.11 through 3402.20 from any other subheading, including another subheading within that group.

3402.90 ............................... A change to subheading 3402.90 from any other heading.

3403.11–3403.19 ................ A change to subheading 3403.11 through 3403.19 from any other subheading, including another subheading within that group, except from heading 2710 or 2712.

3403.91–3403.99 ................ A change to subheading 3403.91 through 3403.99 from any other subheading, including another subheading within that group.

3404.10–3404.20 ................ A change to subheading 3404.10 through 3404.20 from any other subheading, including another subheading within that group.

3404.90 ............................... A change to subheading 3404.90 from any other subheading, except from heading 1521 or subheading 2712.20 or

2712.90.

3405.10–3405.90 ................ A change to subheading 3405.10 through 3405.90 from any other subheading, including another subheading within that group.

3406–3407 .......................... A change to heading 3406 through 3407 from any other heading, including another heading within that group.

3501.10–3501.90 ................ A change to subheading 3501.10 through 3501.90 from any other subheading, including another subheading within that group.

3502.11–3502.19 ................ A change to subheading 3502.11 through 3502.19 from any other subheading outside that group, except from

heading 0407.

3502.20–3502.90 ................ A change to subheading 3502.20 through 3502.90 from any other subheading, including another subheading within that group.

3503–3504 .......................... A change to heading 3503 through 3504 from any other heading, including another heading within that group.

3505.10 ............................... A change to subheading 3505.10 from any other subheading.

3505.20 ............................... A change to subheading 3505.20 from any other subheading, except from heading 1108.

3506.10 ............................... A change to subheading 3506.10 from any other subheading, except from heading 3503 or subheading 3501.90.

3506.91–3506.99 ................ A change to subheading 3506.91 through 3506.99 from any other subheading, including another subheading within that group.

3507 .................................... A change to heading 3507 from any other heading.

3601–3606 .......................... A change to heading 3601 through 3606 from any other heading, including any other heading within that group.

3701–3703 .......................... A change to heading 3701 through 3703 from any other heading outside that group.

3704–3706 .......................... A change to heading 3704 through 3706 from any other heading, including another heading within that group.

3707.10–3707.90 ................ A change to subheading 3707.10 through 3707.90 from any other subheading, including another subheading within that group.

3801.10 ............................... A change to subheading 3801.10 from any other subheading.

3801.20 ............................... A change to subheading 3801.20 from any other subheading, except from heading 2504 or subheading 3801.10.

3801.30 ............................... A change to subheading 3801.30 from any other subheading.

3801.90 ............................... A change to subheading 3801.90 from any other subheading, except from heading 2504.

3802–3805 .......................... A change to heading 3802 through 3805 from any other heading, including another heading within that group.

3806.10–3806.90 ................ A change to subheading 3806.10 through 3806.90 from any other subheading, including another subheading within that group.

3807 .................................... A change to heading 3807 from any other heading.

3808.10 ............................... A change to subheading 3808.10 from any other subheading, except from subheading 1302.14 or from any insecticide classified in Chapter 28 or 29.

3808.20 ............................... A change to subheading 3808.20 from any other subheading, except from fungicides classified in Chapter 28 or

29.

3808.30 ............................... A change to subheading 3808.30 from any other subheading, except from herbicides, antisprouting products and

plant-growth regulators classified in Chapter 28 or 29; or

A change to a mixture of subheading 3808.30 from any other subheading, provided that the mixture is made from

two or more active ingredients and a domestic active ingredient constitutes no less than 40 percent by weight of

the total active ingredients.

3808.40 ............................... A change to subheading 3808.40 from any other subheading.

3808.90 ............................... A change to subheading 3808.90 from any other subheading, except from rodenticides and other pesticides classified in Chapter 28 or 29; or

A change to a mixture of subheading 3808.90 from any other subheading, provided that the mixture is made from

two or more active ingredients and a domestic active ingredient constitutes no less than 40 percent by weight of

the total active ingredients.

3809.10 ............................... A change to subheading 3809.10 from any other subheading, except from subheading 3505.10.

3809.91–3809.99 ................ A change to subheading 3809.91 through 3809.99 from any other subheading, including another subheading within that group.

3810–3816 .......................... A change to heading 3810 through 3816 from any other heading, including another heading within that group.

3817.10–3817.20 ................ A change to subheading 3817.10 through 3817.20 from any other subheading, including another subheading within that group, except from subheading 2902.90.

3818 .................................... A change to heading 3818 from any other heading.
28966 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

3819 .................................... A change to heading 3819 from any other heading, except from heading 2710.

3820 .................................... A change to heading 3820 from any other heading, except from subheading 2905.31.

3821................ .................... A change to heading 3821 from any other heading.

3822................ .................... A change to heading 3822 from any other heading, except from subheading 3002.10 or 3502.90 or heading 3504.

3823.11–3823.13..... ........... A change to subheading 3823.11 through 3823.13 from any other subheading, including another subheading within that group, except from heading 1520.

3823.19............. .................. A change to subheading 3823.19 from any other subheading.

3823.70............. .................. A change to subheading 3823.70 from any other subheading, except from heading 1520.

3824.10............. .................. A change to subheading 3824.10 from any other subheading, except from heading 3505, subheading 3806.10 or

3806.20, or heading 3903, 3905, 3906, 3909, 3911, or 3913.

3824.20............. .................. A change to subheading 3824.20 from any other subheading.

3824.30............. .................. A change to subheading 3824.30 from any other subheading, except from heading 2849.

3824.40............. .................. A change to subheading 3824.40 from any other subheading.

3824.50............. .................. A change to subheading 3824.50 from any other subheading, except from subheading 3214.90.

3824.60............. .................. A change to subheading 3824.60 from any other subheading.

3824.71–3824.90..... ........... A change to subheading 3824.71 through 3824.90 from any other subheading, including another subheading within that group, provided that no more than 60 percent by weight of the good classified in this subheading is attributable to one substance or compound.

(g) Section VII: Chapters 39 through 40

Chapter 39 Note: The country of origin of goods classified in subheadings 3921.12.15, 3921.13.15, and 3921.90.2550 shall be determined

under the provisions of § 102.21.

3901–3915........... ............... A change to heading 3901 through 3915 from any other heading, including another heading within that group, provided that the domestic polymer content is no less than 40 percent by weight of the total polymer content.

3916.10–3918.90 ................ A change to subheading 3916.10 through 3918.90 from any other subheading, including another subheading within that group.

3919.10–3919.90 ................ A change to subheading 3919.10 through 3919.90 from any other subheading outside that group.

3920.10–3921.90 ................ A change to subheading 3920.10 through 3921.90 from any other subheading, including another subheading within that group.

3922–3926 .......................... A change to heading 3922 through 3926 from any other heading, including another heading within that group.

4001.10–4001.22 ................ A change to subheading 4001.10 through 4001.22 from any other subheading, including another subheading within that group.

4001.29 ............................... A change to subheading 4001.29 from any other subheading, except from subheading 4001.21 or 4001.22.

4001.30 ............................... A change to subheading 4001.30 from any other subheading.

4002.11–4002.70 ................ A change to subheading 4002.11 through 4002.70 from any other subheading, including another subheading within that group.

4002.80–4002.99 ................ A change to subheading 4002.80 through 4002.99 from any other subheading, including another subheading within that group, provided that the domestic rubber content is no less than 40 percent by weight of the total rubber

content.

4003–4004 .......................... A change to heading 4003 through 4004 from any other heading, including another heading within that group.

4005 .................................... A change to heading 4005 from any other heading, except from heading 4001 or 4002.

4006–4010 .......................... A change to heading 4006 through 4010 from any other heading, including another heading within that group.

4011.10–4012.90 ................ A change to subheading 4011.10 through 4012.90 from any other subheading, including another subheading within that group.

4013 .................................... A change to heading 4013 from any other heading.

4014.10–4014.90 ................ A change to subheading 4014.10 through 4014.90 from any other subheading, including another subheading within that group.

4015 .................................... A change to heading 4015 from any other heading.

4016.10–4016.99 ................ A change to subheading 4016.10 through 4016.99 from any other subheading, including another subheading within that group.

4017 .................................... A change to heading 4017 from any other heading.

(h) Section VIII: Chapters 41 through 43

4101–4103 .......................... A change to heading 4101 through 4103 from any other chapter.

4104–4107 .......................... A change to heading 4104 through 4107 from any other heading, including another heading within that group.

4108–4111 .......................... A change to heading 4108 through 4111 from any other heading, including another heading within that group.

Chapter 42 Note: The country of origin of goods classified in subheadings 4202.12.40 through 4202.12.80, 4202.22.40 through 4202.22.80,

4202.32.40 through 4202.32.95, 4202.92.15 through 4202.92.30, and 4202.92.60 through 4202.92.90 shall be determined under the provisions

of § 102.21.

4201................ .................... A change to heading 4201 from any other heading.

4202.11 ............................... A change to subheading 4202.11 from any other heading.

4202.12–4202.22 ................ A change to subheading 4202.12 through 4202.22 from any other heading, provided that the change does not result from the assembly of foreign cut components.

4202.29 ............................... A change to subheading 4202.29 from any other heading.

4202.31–4202.32 ................ A change to subheading 4202.31 through 4202.32 from any other heading, provided that the change does not result from the assembly of foreign cut components.

4202.39 ............................... A change to subheading 4202.39 from any other heading.

4202.91–4202.99 ................ A change to subheading 4202.91 through 4202.99 from any other heading, provided that the change does not result from the assembly of foreign cut components.

4203–4206 .......................... A change to heading 4203 through 4206 from any other heading, including another heading within that group.
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HTSUS Tariff shift and/or other requirements

4301 .................................... A change to heading 4301 from any other chapter.

4302.11–4302.20 ................ A change to subheading 4302.11 through 4302.20 from any other heading.

4302.30 ............................... A change to subheading 4302.30 from any other subheading, provided that the change does not result from the

assembly of foreign cut fur components.

4303–4304 .......................... A change to heading 4303 through 4304 from any other heading, including another heading within that group.

(i) Section IX: Chapters 44 through 46

4401–4411 .......................... A change to heading 4401 through 4411 from any other heading, including another heading within that group.

4412 .................................... A change to heading 4412 from any other heading; or

A change to surface-covered plywood of heading 4412 from any other plywood that is not surface-covered or is

surface-covered only with a clear or transparent material which does not obscure the grain, texture, or markings

of the face ply.

4413–4421 .......................... A change to heading 4413 through 4421 from any other heading, including another heading within that group.

4501 .................................... A change to heading 4501 from any other heading.

4502 .................................... A change to heading 4502 from any other heading, except from heading 4501.

4503–4504 .......................... A change to heading 4503 through 4504 from any other heading, including another heading within that group.

4601 .................................... A change to subheading 4601.10 through 4601.99 from any other subheading, including another subheading within that group.

4602 .................................... A change to heading 4602 from any other heading.

(j) Section X: Chapters 47 through 49

4701–4702 .......................... A change to heading 4701 through 4702 from any other heading, including another heading within that group.

4703.11–4704.29 ................ A change to subheading 4703.11 through 4704.29 from any other subheading, including another subheading within that group.

4705–4707 .......................... A change to heading 4705 through 4707 from any other heading, including another heading within that group.

4801–4807 .......................... A change to heading 4801 through 4807 from any other heading, including another heading within that group.

4808.10 ............................... A change to subheading 4808.10 from any other heading.

4808.20–4808.30 ................ A change to subheading 4808.20 through 4808.30 from any other heading, except from heading 4804.

4808.90 ............................... A change to subheading 4808.90 from any other chapter.

4809 .................................... A change to heading 4809 from any other heading.

4810 .................................... A change to heading 4810 from any other heading.

4811.10–4811.31 ................ A change to subheading 4811.10 through 4811.31 from any other heading.

4811.39 ............................... A change to subheading 4811.39 from any other heading, except from heading 4804.

4811.40–4811.90 ................ A change to subheading 4811.40 through 4811.90 from any other heading.

4812–4814 .......................... A change to heading 4812 through 4814 from any other heading, including another heading within that group.

4815 .................................... A change to heading 4815 from any other heading.

4816 .................................... A change to heading 4816 from any other heading, except from heading 4809.

4817–4822 .......................... A change to heading 4817 through 4822 from any other heading, including another heading within that group.

4823.11 ............................... A change to subheading 4823.11 from any other subheading.

4823.19 ............................... A change to subheading 4823.19 from any other subheading.

4823.20–4823.59 ................ A change to subheading 4823.20 through 4823.59 from any other chapter.

4823.60–4823.70 ................ A change to subheading 4823.60 through 4823.70 from any other subheading, including another subheading within that group.

4823.90 ............................... A change to a good of subheading 4823.90, other than to cards not punched and for punchcard machines, from

any other subheading; or

A change to cards not punched and for punchcard machines of subheading 4823.90 from any other chapter.

4901–4911 .......................... A change to heading 4901 through 4911 from any other heading, including another heading within that group.

(k) Section XII: Chapters 64 through 67

Chapter 64 Note: For purposes of this chapter, the term ‘‘formed uppers’’ means uppers, with closed bottoms, which have been shaped by

lasting, molding or otherwise but not by simply closing at the bottom. The country of origin of goods classified in subheadings 6405.20.60,

6406.10.77, 6406.10.90, and 6406.99.15 shall be determined under the provisions of § 102.21.

6401–6405 .......................... A change to heading 6401 through 6405 from any other heading outside that group, except from formed uppers.

6406.10 ............................... A change to subheading 6406.10 from any other subheading.

6406.20–6406.99 ................ A change to subheading 6406.20 through 6406.99 from any other chapter.

6505.10 ............................... A change to subheading 6505.10 from any other subheading.

6506 .................................... A change to heading 6506 from any other heading, except from heading 6501 through 6502; or

A change to heading 6506 from heading 6501 by means of a blocking process; or

A change to heading 6506 from heading 6502, provided that the change is the result of at least three processing

steps (e.g. dyeing, blocking, trimming, or adding a sweatband).

6507 .................................... A change to heading 6507 from any other heading.

6602 .................................... A change to heading 6602 from any other heading.

6603.10 ............................... A change to subheading 6603.10 from any other heading.

6603.20 ............................... A change to subheading 6603.20 from any other heading; or

A change to subheading 6603.20 from subheading 6603.90, except when that change is pursuant to General Rule

of Interpretation 2(a).

6603.90 ............................... A change to subheading 6603.90 from any other heading.

6701 .................................... A change to heading 6701 from any other heading; or

A change to articles of feather or down of heading 6701 from feathers or down.
28968 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

6702–6704 .......................... A change to heading 6702 through 6704 from any other heading, including another heading within that group.

(l) Section XIII: Chapters 68 through 70

6801–6808 .......................... A change to heading 6801 through 6808 from any other heading, including another heading within that group.

6809.11 ............................... A change to subheading 6809.11 from any other heading.

6809.19 ............................... A change to subheading 6809.19 from any other heading.

6809.90 ............................... A change to subheading 6809.90 from any other subheading.

6810.11–6810.19. ............... A change to subheading 6810.11 through 6810.19 from any other heading.

6810.91 ............................... A change to subheading 6810.91 from any other subheading.

6810.99 ............................... A change to subheading 6810.99 from any other heading.

6811.10 ............................... A change to subheading 6811.10 from any other heading.

6811.20 ............................... A change to subheading 6811.20 from any other heading.

6811.30 ............................... A change to subheading 6811.30 from any other heading.

6811.90 ............................... A change to subheading 6811.90 from any other heading.

6812.10 ............................... A change to subheading 6812.10 from any other heading.

6812.20 ............................... A change to subheading 6812.20 from any other subheading.

6812.30 ............................... A change to subheading 6812.30 from any other subheading, except from subheading 6812.20.

6812.40 ............................... A change to subheading 6812.40 from any other subheading.

6812.50 ............................... A change to subheading 6812.50 from any other subheading.

6812.60–6812.70. ............... A change to subheading 6812.60 through 6812.70 from any other subheading outside that group.

6812.90 ............................... A change to subheading 6812.90 from any other heading.

6813 .................................... A change to heading 6813 from any other heading.

6814.10 ............................... A change to subheading 6814.10 from any other heading.

6814.90 ............................... A change to subheading 6814.90 from any other heading.

6815.10–6815.99. ............... A change to subheading 6815.10 through 6815.99 from any other subheading, including another subheading within that group.

6901–6914 .......................... A change to heading 6901 through 6914 from any other chapter.

Chapter 70 Note: The country of origin of goods classified in subheadings 7019.19.15 and 7019.19.28 shall be determined under the provisions of § 102.21.

7001 .................................... A change to heading 7001 from any other heading.

7002 .................................... A change to heading 7002 from any other heading.

7003–7006 .......................... A change to heading 7003 through 7006 from any other heading outside that group.

7007 .................................... A change to heading 7007 from any other heading.

7008 .................................... A change to heading 7008 from any other heading.

7009.10 ............................... A change to subheading 7009.10 from any other subheading.

7009.91–7009.92 ................ A change to subheading 7009.91 through 7009.92 from any other heading.

7010 .................................... A change to heading 7010 from any other heading.

7011 .................................... A change to heading 7011 from any other heading, except from subheading 7003.30.

7012–7018 .......................... A change to heading 7012 through 7018 from any other heading, including another heading within that group; or

A change from uncut and unpolished glassware blanks classified in heading 7013 to cut and polished glassware

classified in heading 7013, provided that there has been a substantial amount of both cutting and polishing operations in a single country.

7019.11–7019.19 ................ A change to subheading 7019.11 through 7019.19 from any other heading.

7019.31–7019.32 ................ A change to subheading 7019.31 through 7019.32 from any other subheading outside that group.

7019.39 ............................... A change to subheading 7019.39 from any other subheading.

7019.40–7019.59 ................ A change to subheading 7019.40 through 7019.59 from any other subheading outside that group.

7019.90 ............................... A change to subheading 7019.90 from any other heading.

7020. ................................... A change to heading 7020 from any other heading, except from heading 7010 through 7018.

(m) Section XIV: Chapter 71

7101 .................................... A change to heading 7101 from any other heading, except from heading 0307.

7102–7103 .......................... A change to heading 7102 through 7103 from any other chapter.

7104–7105 .......................... A change to heading 7104 through 7105 from any other heading, including another heading within that group.

7106 .................................... A change to heading 7106 from any other chapter.

7107 .................................... A change to heading 7107 from any other chapter, except from Chapter 72 through 76 or Chapter 78 through 83.

7108 .................................... A change to heading 7108 from any other chapter.

7109 .................................... A change to heading 7109 from any other chapter, except from Chapter 72 through 76 or Chapter 78 through 83.

7110 .................................... A change to heading 7110 from any other chapter.

7111 .................................... A change to heading 7111 from any other chapter, except from Chapter 72 through 76 or Chapter 78 through 83.

7112 .................................... A change to heading 7112 from any other heading.

7113.11–7115.90 ................ A change to subheading 7113.11 through 7115.90 from any other subheading, including another subheading within that group.

7116 .................................... A change to heading 7116 from any other heading, except that pearls strung but without the addition of clasps or

other ornamental features of precious metals or stones, shall have the origin of the pearls.

7117–7118 .......................... A change to heading 7117 through 7118 from any other heading, including another heading within that group.

(n) Section XV: Chapters 72 through 83

Chapter 72 Note: Notwithstanding the specific rules of this chapter, hot-rolled flat-rolled steel which is cold-reduced (by cold rolling) shall be

treated as a good of the country in which the cold-rolled steel is produced.
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HTSUS Tariff shift and/or other requirements

7201–7206 .......................... A change to heading 7201 through 7206 from any other heading, including another heading within that group.

7207 .................................... A change to heading 7207 from any other heading, except from heading 7206.

7208 .................................... A change to heading 7208 from any other heading.

7209 .................................... A change to heading 7209 from any other heading, except from heading 7208 or 7211.

7210 .................................... A change to heading 7210 from any other heading, except from heading 7208 through 7212.

7211 .................................... A change to heading 7211 from any other heading, except from heading 7208 through 7209.

7212 .................................... A change to heading 7212 from any other heading, except from heading 7208 through 7211.

7213 .................................... A change to heading 7213 from any other heading.

7214 .................................... A change to heading 7214 from any other heading, except from heading 7213.

7215 .................................... A change to heading 7215 from any other heading, except from heading 7213 through 7214.

7216 .................................... A change to heading 7216 from any other heading, except from heading 7208 through 7215.

7217 .................................... A change to heading 7217 from any other heading, except from heading 7213 through 7215.

7218 .................................... A change to heading 7218 from any other heading.

7219–7220 .......................... A change to heading 7219 through 7220 from any other heading outside that group.

7221–7222 .......................... A change to heading 7221 through 7222 from any other heading outside that group.

7223 .................................... A change to heading 7223 from any other heading, except from heading 7221 through 7222.

7224 .................................... A change to heading 7224 from any other heading.

7225–7226 .......................... A change to heading 7225 through 7226 from any other heading outside that group.

7227–7228 .......................... A change to heading 7227 through 7228 from any other heading outside that group.

7229 .................................... A change to heading 7229 from any other heading, except from heading 7227 through 7228.

7301–7307 .......................... A change to heading 7301 through 7307 from any other heading, including another heading within that group.

7308 .................................... A change to heading 7308 from any other heading, except for changes resulting from the following processes performed on angles, shapes, or sections classified in heading 7216:

(a) drilling, punching, notching, cutting, cambering, or sweeping, whether performed individually or in combination;

(b) adding attachments or weldments for composite construction;

(c) adding attachments for handling purposes;

(d) adding weldments, connectors or attachments to H-sections or I-sections; provided that the maximum dimension of the weldments, connectors, or attachments is not greater than the dimension between the inner surfaces

of the flanges of the H-sections or I-sections;

(e) painting, galvanizing, or otherwise coating; or

(f) adding a simple base plate without stiffening elements, individually or in combination with drilling, punching,

notching, or cutting, to create an article suitable as a column.

7309–7314 .......................... A change to heading 7309 through 7314 from any other heading, including another heading within that group.

7315.11–7315.12 ................ A change to subheading 7315.11 through 7315.12 from any other heading; or

A change to subheading 7315.11 through 7315.12 from subheading 7315.19 or 7315.90, except when that change

is pursuant to General Rule of Interpretation 2(a).

7315.19 ............................... A change to subheading 7315.19 from any other subheading.

7315.20–7315.89 ................ A change to subheading 7315.20 through 7315.89 from any other heading; or

A change to subheading 7315.20 through 7315.89 from subheading 7315.90, except when that change is pursuant

to General Rule of Interpretation 2(a).

7315.90 ............................... A change to subheading 7315.90 from any other subheading.

7316 .................................... A change to heading 7316 from any other heading, except from heading 7312 or 7315.

7317–7318 .......................... A change to heading 7317 through 7318 from any other heading, including another heading within that group.

7319 .................................... A change to heading 7319 from any other heading.

7320 .................................... A change to heading 7320 from any other heading.

7321.11–7321.83 ................ A change to subheading 7321.11 through 7321.83 from any other heading; or

A change to subheading 7321.11 through 7321.83 from heading 7321.90, except when that change is pursuant to

General Rule of Interpretation 2(a).

7321.90 ............................... A change to subheading 7321.90 from any other heading.

7322–7323 .......................... A change to heading 7322 through 7323 from any other heading, including another heading within that group.

7324.10–7324.29 ................ A change to subheading 7324.10 through 7324.29 from any other subheading, including another subheading within that group.

7324.90 ............................... A change to subheading 7324.90 from any other subheading.

7325–7326 .......................... A change to heading 7325 through 7326 from any other heading, including another heading within that group.

7401–7407 .......................... A change to heading 7401 through 7407 from any other heading, including another heading within that group.

7408 .................................... A change to heading 7408 from any other heading, except from heading 7407.

7409 .................................... A change to heading 7409 from any other heading.

7410 .................................... A change to heading 7410 from any other heading, except from plate, sheet, or strip classified in heading 7409 of

a thickness less than 5mm.

7411–7418 .......................... A change to heading 7411 through 7418 from any other heading, including another heading within that group.

7419.10–7419.99 ................ A change to subheading 7419.10 through 7419.99 from any other subheading, including another subheading within that group.

7501 .................................... A change to heading 7501 from any other heading.

7502 .................................... A change to heading 7502 from any other heading.

7503 .................................... A change to heading 7503 from any other heading.

7504 .................................... A change to heading 7504 from any other heading.

7505 .................................... A change to heading 7505 from any other heading.

7506 .................................... A change to heading 7506 from any other heading; or

A change to foil, not exceeding 0.15 mm in thickness, from any other good of heading 7506, provided that there

has been a reduction in thickness of no less than 50 percent.

7507.11–7508.90 ................ A change to subheading 7507.11 through 7508.90 from any other subheading, including another subheading within that group.

7601–7604 .......................... A change to heading 7601 through 7604 from any other heading, including another heading within that group.

7605 .................................... A change to heading 7605 from any other heading, except from heading 7604.
28970 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

7606–7615 .......................... A change to heading 7606 through 7615 from any other heading, including another heading within that group.

7616.10–7616.99 ................ A change to subheading 7616.10 through 7616.99 from any other subheading, including another subheading within that group.

7801–7803 .......................... A change to heading 7801 through 7803 from any other heading, including another heading within that group.

7804.11–7804.20 ................ A change to subheading 7804.11 through 7804.20 from any other subheading, including another subheading within that group; or

A change to any of the following goods classified in subheading 7804.11 through 7804.20, including from materials

also classified in subheading 7804.11 through 7804.20: powder except from flakes; flakes except from powder;

plates except from sheets or strip; sheets except from plate or strip; strip except from sheets or plate.

7805–7806 .......................... A change to heading 7805 through 7806 from any other heading, including another heading within that group; or

A change to any of the following goods classified in heading 7805 through 7806, including from materials also

classified in heading 7805 through 7806: tubes except from pipes; pipes except from tubes; tube or pipe fittings

except from tubes or pipes; cables/stranded wire/plaited bands.

7901–7906 .......................... A change to heading 7901 through 7906 from any other heading, including another heading within that group; or

A change to any of the following goods classified in heading 7901 through 7906, including from materials also

classified in heading 7901 through 7906: Matte; unwrought; powder except from flakes; flakes except from powder; bars except from rods or profiles; rods except from bars or profiles; profiles except from rods or bars; wire

except from rod; plates except from sheets or strip; sheets except from plate or strip; strip except from sheets or

plate; foil except from sheet or strip; tubes except from pipes; pipes except from tubes; tube or pipe fittings except from tubes or pipes.

7907 .................................... A change to heading 7907 from any other heading.

8001 .................................... A change to heading 8001 from any other heading.

8002–8004 .......................... A change to heading 8002 through 8004 from any other heading, including another heading within that group; or

A change to any of the following goods classified in heading 8002 through 8004, including from materials also

classified in heading 8002 through 8004: Bars except from rods or profiles; rods except from bars or profiles;

profiles except from rods or bars; wire except from rod; plates except from sheets or strip; sheets except from

plate or strip; strip except from sheets or plate.

8005 .................................... A change to heading 8005 from any other heading; or

A change to foil of heading 8005 from powder or flakes of that heading; or

A change to powder of heading 8005 from foil of that heading; or

A change to flakes of heading 8005 from foil of that heading.

8006–8007 .......................... A change to heading 8006 through 8007 from any other heading, including another heading within that group; or

A change to any of the following goods classified in heading 8006 through 8007, including from materials also

classified in heading 8006 through 8007: Tubes except from pipes; pipes except from tubes; tube or pipe fittings

except from tubes or pipes; cables/stranded wire/plaited bands.

Chapter 81 Note: Waste and scrap are products of the country in which they are collected.

8101.10–8101.92 ................ A change to subheading 8101.10 through 8101.92 from any other subheading, including another subheading within that group; or

A change to any of the following goods classified in subheading 8101.10 through 8101.92, including from materials

also classified in subheading 8101.10 through 8101.92: Matte; unwrought; bars except from rods or profiles;

rods except from bars or profiles; profiles except from rods or bars; plates except from sheets or strip; sheets

except from plate or strip; strip except from sheets or plate; foil except from sheet or strip.

8101.93 ............................... A change to subheading 8101.93 from any other subheading, except from subheading 8101.92.

8101.99 ............................... A change to subheading 8101.99 from any other subheading; or

A change to any of the following goods classified in subheading 8101.99, including from materials also classified

in subheading 8101.99: Tubes except from pipes; pipes except from tubes; tube or pipe fittings except from

tubes or pipes; cables/stranded wire/plaited bands.

8102.10–8102.92 ................ A change to subheading 8102.10 through 8102.92 from any other subheading, including another subheading within that group; or

A change to any of the following goods classified in subheading 8102.10 through 8102.92, including from materials

also classified in subheading 8102.10 through 8102.92: Matte; unwrought; bars except from rods or profiles;

rods except from bars or profiles; profiles except from rods or bars; plates except from sheets or strip; sheets

except from plate or strip; strip except from sheets or plate; foil except from sheet or strip.

8102.93 ............................... A change to subheading 8102.93 from any other subheading, except from subheading 8102.92.

8102.99 ............................... A change to subheading 8102.99 from any other subheading.

8103.10–8113.00 ................ A change to subheading 8103.10 through 8113.00 from any other subheading, including another subheading within that group; or

A change to any of the following goods classified in subheading 8103.10 through 8113.00, including from materials

also classified in subheading 8103.10 through 8113.00: Matte; unwrought; powder except from flakes; flakes except from powder; bars except from rods or profiles; rods except from bars or profiles; profiles except from rods

or bars; wire except from rod; plates except from sheets or strip; sheets except from plate or strip; strip except

from sheets or plate; foil except from sheet or strip; tubes except from pipes; pipes except from tubes; tube or

pipe fittings except from tubes or pipes; cables/stranded wire/plaited bands.

8201.10–8202.40 ................ A change to subheading 8201.10 through 8202.40 from any other subheading, including another subheading within that group.

8202.91 ............................... A change to subheading 8202.91 from any other subheading, except from subheading 8202.99.

8202.99 ............................... A change to subheading 8202.99 from any other heading.

8203.10–8207.90 ................ A change to subheading 8203.10 through 8207.90 from any other subheading, including another subheading within that group.

8208–8215 .......................... A change to heading 8208 through 8215 from any other heading, including another heading within that group.

8301.10–8301.50 ................ A change to subheading 8301.10 through 8301.50 from any other subheading, including another subheading within that group, except from subheading 8301.60 when that change is pursuant to General Rule of Interpretation

2(a).
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28971

HTSUS Tariff shift and/or other requirements

8301.60–8301.70 ................ A change to subheading 8301.60 through 8301.70 from any other chapter.

8302.10–8302.60 ................ A change to subheading 8302.10 through 8302.60 from any other subheading, including another subheading within that group.

8303–8304 .......................... A change to heading 8303 through 8304 from any other heading, including another heading within that group.

8305.10–8305.90 ................ A change to subheading 8305.10 through 8305.90 from any other subheading, including another subheading within that group.

8306–8307 .......................... A change to heading 8306 through 8307 from any other heading, including another heading within that group.

8308.10–8308.90 ................ A change to subheading 8308.10 through 8308.90 from any other subheading, including another subheading within that group.

8309–8310 .......................... A change to heading 8309 through 8310 from any other heading, including another heading within that group.

8311.10–8311.90 ................ A change to subheading 8311.10 through 8311.90 from any other subheading, including another subheading within that group.

(o) Section XVI: Chapters 84 through 85

Note: Tariff changes within Chapters 84 and 85 which occur only as a result of the application of General Rule of Interpretation 2(a) of the

HTSUS shall not be sufficient to confer origin.

8401.10 ............................... A change to subheading 8401.10 from any other subheading.

8401.20 ............................... A change to subheading 8401.20 from any other subheading; or

A change to completed machinery and apparatus classified in subheading 8401.20 from parts classified in subheading 8401.20.

8401.30 ............................... A change to subheading 8401.30 from any other subheading.

8401.40 ............................... A change to subheading 8401.40 from any other heading.

8402.11–8402.12 ................ A change to subheading 8402.11 through 8402.12 from any other subheading outside that group.

8402.19–8402.20 ................ A change to subheading 8402.19 through 8402.20 from any other subheading, including another subheading within that group.

8402.90 ............................... A change to subheading 8402.90 from any other heading, except from heading 7303, 7304, 7305, or 7306 unless

the change from these headings involves bending to shape.

8403.10 ............................... A change to subheading 8403.10 from any other subheading.

8403.90 ............................... A change to subheading 8403.90 from any other heading.

8404.10–8404.20 ................ A change to subheading 8404.10 through 8404.20 from any other subheading, including another subheading within that group.

8404.90 ............................... A change to subheading 8404.90 from any other heading.

8405.10 ............................... A change to subheading 8405.10 from any other subheading.

8405.90 ............................... A change to subheading 8405.90 from any other heading.

8406.10 ............................... A change to subheading 8406.10 from any other subheading.

8406.81–8406.82 ................ A change to subheading 8406.81 through 8406.82 from any other subheading outside that group.

8406.90 ............................... A change to subheading 8406.90 from any other heading.

8407 .................................... A change to heading 8407 from any other heading.

8408 .................................... A change to heading 8408 from any other heading.

8409.10 ............................... A change to subheading 8409.10 from any other heading.

8409.91–8409.99 ................ A change to subheading 8409.91 through 8409.99 from any other heading, except a change resulting from a simple assembly.

8410.11–8410.13 ................ A change to subheading 8410.11 through 8410.13 from any other subheading outside that group.

8410.90 ............................... A change to subheading 8410.90 from any other heading.

8411.11–8411.82 ................ A change to subheading 8411.11 through 8411.82 from any other subheading outside that group.

8411.91–8411.99 ................ A change to subheading 8411.91 through 8411.99 from any other heading.

8412.10–8412.80 ................ A change to subheading 8412.10 through 8412.80 from any other subheading, including another subheading within that group.

8412.90 ............................... A change to subheading 8412.90 from any other heading.

8413.11–8413.82 ................ A change to subheading 8413.11 through 8413.82 from any other subheading, including another subheading within that group.

8413.91 ............................... A change to subheading 8413.91 from any other heading.

8413.92 ............................... A change to subheading 8413.92 from any other heading.

8414.10–8414.80 ................ A change to subheading 8414.10 through 8414.80 from any other subheading, including another subheading within that group.

8414.90 ............................... A change to subheading 8414.90 from any other heading.

8415.10–8415.83 ................ A change to subheading 8415.10 through 8415.83 from any subheading, including another subheading within that

group, except a change within that group resulting from a simple assembly.

8415.90 ............................... A change to subheading 8415.90 from any other subheading, except from heading 7411, 7608, 8414, 8501, or

8535 through 8537 when resulting from a simple assembly.

8416.10–8416.30 ................ A change to subheading 8416.10 through 8416.30 from any other subheading, including another subheading within that group.

8416.90 ............................... A change to subheading 8416.90 from any other heading.

8417.10–8417.80 ................ A change to subheading 8417.10 through 8417.80 from any other subheading, including another subheading within that group.

8417.90 ............................... A change to subheading 8417.90 from any other heading.

8418.10–8418.91 ................ A change to subheading 8418.10 through 8418.91 from any other subheading, including another subheading within that group.

8418.99 ............................... A change to subheading 8418.99 from any other heading, except from heading 7303, 7304, 7305, or 7306 unless

the change from these headings involves bending to shape.

8419.11–8419.89 ................ A change to subheading 8419.11 through 8419.89 from any other subheading, including another subheading within that group.
28972 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

8419.90 ............................... A change to subheading 8419.90 from any other heading, except from heading 7303, 7304, 7305, or 7306 unless

the change from these headings involves bending to shape, and except from heading 8501 when resulting from

a simple assembly.

8420.10 ............................... A change to subheading 8420.10 from any other subheading.

8420.91 ............................... A change to subheading 8420.91 from any other heading.

8420.99 ............................... A change to subheading 8420.99 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8421.11–8421.39 ................ A change to subheading 8421.11 through 8421.39 from any other subheading, including another subheading within that group.

8421.91 ............................... A change to subheading 8421.91 from any other heading.

8421.99 ............................... A change to subheading 8421.99 from any other heading.

8422.11–8422.40 ................ A change to subheading 8422.11 through 8422.40 from any other subheading, including another subheading within that group.

8422.90 ............................... A change to subheading 8422.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8423.10–8423.89 ................ A change to subheading 8423.10 through 8423.89 from any other subheading, including another subheading within that group.

8423.90 ............................... A change to subheading 8423.90 from any other heading.

8424.10–8424.89 ................ A change to subheading 8424.10 through 8424.89 from any other subheading, including another subheading within that group.

8424.90 ............................... A change to subheading 8424.90 from any other heading, except from subheading 8414.40 or 8414.80.

8425.11–8430.69 ................ A change to subheading 8425.11 through 8430.69 from any other subheading, including another subheading within that group.

8431 .................................... A change to heading 8431 from any other heading, except from heading 8501 when resulting from a simple assembly.

8432.10–8432.80 ................ A change to subheading 8432.10 through 8432.80 from any other subheading, including another subheading within that group.

8432.90 ............................... A change to subheading 8432.90 from any other heading.

8433.11–8433.60 ................ A change to subheading 8433.11 through 8433.60 from any other subheading, including another subheading within that group.

8433.90 ............................... A change to subheading 8433.90 from any other heading, except from heading 8407 or 8408 when resulting from

a simple assembly.

8434.10–8434.20 ................ A change to subheading 8434.10 through 8434.20 from any other subheading, including another subheading within that group.

8434.90 ............................... A change to subheading 8434.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8435.10 ............................... A change to subheading 8435.10 from any other subheading.

8435.90 ............................... A change to subheading 8435.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8436.10–8436.80 ................ A change to subheading 8436.10 through 8436.80 from any other subheading, including another subheading within that group.

8436.91 ............................... A change to subheading 8436.91 from any other heading.

8436.99 ............................... A change to subheading 8436.99 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8437.10–8437.80 ................ A change to subheading 8437.10 through 8437.80 from any other subheading, including another subheading within that group.

8437.90 ............................... A change to subheading 8437.90 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8438.10–8438.80 ................ A change to subheading 8438.10 through 8438.80 from any other subheading, including another subheading within that group.

8438.90 ............................... A change to subheading 8438.90 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8439.10–8439.30 ................ A change to subheading 8439.10 through 8439.30 from any other subheading, including another subheading within that group.

8439.91 ............................... A change to subheading 8439.91 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8439.99 ............................... A change to subheading 8439.99 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8440.10 ............................... A change to subheading 8440.10 from any other subheading.

8440.90 ............................... A change to subheading 8440.90 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8441.10–8441.80 ................ A change to subheading 8441.10 through 8441.80 from any other subheading, including another subheading within that group.

8441.90 ............................... A change to subheading 8441.90 from any other heading, except from heading 8407, 8408, or 8501 when resulting from a simple assembly.

8442.10–8442.30 ................ A change to subheading 8442.10 through 8442.30 from any other subheading outside that group.

8442.40 ............................... A change to subheading 8442.40 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8442.50 ............................... A change to subheading 8442.50 from any other heading.

8443.11–8443.60 ................ A change to subheading 8443.11 through 8443.60 from any other subheading outside that group.

8443.90 ............................... A change to subheading 8443.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8444 .................................... A change to heading 8444 from any other heading.

8445.11–8447.90 ................ A change to subheading 8445.11 through 8447.90 from any other subheading outside that group.
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28973

HTSUS Tariff shift and/or other requirements

8448.11–8448.19 ................ A change to subheading 8448.11 through 8448.19 from any other subheading, including another subheading within that group.

8448.20–8448.59 ................ A change to subheading 8448.20 through 8448.59 from any other heading, except from heading 8501 when resulting from a simple assembly.

8449 .................................... A change to heading 8449 from any other heading.

8450.11–8450.20 ................ A change to subheading 8450.11 through 8450.20 from any other subheading, including another subheading within that group.

8450.90 ............................... A change to subheading 8450.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8451.10–8451.80 ................ A change to subheading 8451.10 through 8451.80 from any other subheading, including another subheading within that group.

8451.90 ............................... A change to subheading 8451.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8452.10–8452.29 ................ A change to subheading 8452.10 through 8452.29 from any other subheading outside that group.

8452.30–8452.40 ................ A change to subheading 8452.30 through 8452.40 from any other subheading, including another subheading within that group.

8452.90 ............................... A change to subheading 8452.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8453.10–8453.80 ................ A change to subheading 8453.10 through 8453.80 from any other subheading, including another subheading within that group.

8453.90 ............................... A change to subheading 8453.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8454.10–8454.30 ................ A change to subheading 8454.10 through 8454.30 from any other subheading, including another subheading within that group.

8454.90 ............................... A change to subheading 8454.90 from any other heading.

8455.10–8455.22 ................ A change to subheading 8455.10 through 8455.22 from any other subheading, including another subheading within that group.

8455.30 ............................... A change to subheading 8455.30 from any other heading.

8455.90 ............................... A change to subheading 8455.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8456.10–8456.99 ................ A change to subheading 8456.10 through 8456.99 from any other heading.

8457.10 ............................... A change to subheading 8457.10 from any other heading, except from heading 8458 through 8465 when resulting

from a simple assembly.

8457.20–8465.99 ................ A change to subheading 8457.20 through 8465.99 from any other heading, including another heading within that

group.

8466.10–8466.94 ................ A change to subheading 8466.10 through 8466.94 from any other heading outside that group, except from heading 8501 when resulting from a simple assembly.

8467.11–8467.89 ................ A change to subheading 8467.11 through 8467.89 from any other subheading, including another subheading within that group.

8467.91–8467.99 ................ A change to subheading 8467.91 through 8467.99 from any other heading, except from heading 8407.

8468.10–8468.80 ................ A change to subheading 8468.10 through 8468.80 from any other subheading, including another subheading within that group.

8468.90 ............................... A change to subheading 8468.90 from any other heading.

8469.11–8469.12 ................ A change to subheading 8469.11 through 8469.12 from any other subheading outside that group.

8469.20–8469.30 ................ A change to subheading 8469.20 through 8469.30 from any other subheading outside that group.

8470.10–8471.50 ................ A change to subheading 8470.10 through 8471.50 from any other subheading outside that group, except from

heading 8473; or

A change to subheading 8470.10 through 8471.50 from any other subheading within that group or from heading

8473, provided that the change is not the result of a simple assembly.

8471.60–8472.90 ................ A change to subheading 8471.60 through 8472.90 from any other subheading outside that group, except from

subheading 8504.40 or heading 8473; or

A change to subheading 8471.60 through 8472.90 from any other subheading within that group or from subheading 8504.40 or from heading 8473, provided that the change is not the result of a simple assembly.

8473 .................................... A change to heading 8473 from any other heading, except from heading 8414, 8501, 8504, 8534, 8541, or 8542

when resulting from a simple assembly.

8474.10–8474.80 ................ A change to subheading 8474.10 through 8474.80 from any other subheading outside that group, except from

heading 8501; or

A change to subheading 8474.10 through 8474.80 from any other subheading within that group or from heading

8501, provided that the change is not the result of a simple assembly.

8474.90 ............................... A change to subheading 8474.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8475.10 ............................... A change to subheading 8475.10 from any other subheading.

8475.21–8475.29 ................ A change to subheading 8475.21 through 8475.29 from any other subheading outside that group.

8475.90 ............................... A change to subheading 8475.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8476.21–8476.89 ................ A change to subheading 8476.21 through 8476.89 from any other subheading outside that group.

8476.90 ............................... A change to subheading 8476.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8477.10–8477.80 ................ A change to subheading 8477.10 through 8477.80 from any other subheading, including another subheading within that group.

8477.90 ............................... A change to subheading 8477.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8478.10 ............................... A change to subheading 8478.10 from any other subheading.
28974 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

8478.90 ............................... A change to subheading 8478.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8479.10–8479.89 ................ A change to subheading 8479.10 through 8479.89 from any other subheading, including another subheading within that group.

8479.90 ............................... A change to subheading 8479.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8480 .................................... A change to heading 8480 from any other heading.

8481.10–8481.80 ................ A change to subheading 8481.10 through 8481.80 from any other heading, or from subheading 8481.90 except

when resulting from a simple assembly.

8481.90 ............................... A change to subheading 8481.90 from any other heading.

8482.10–8482.80 ................ A change to subheading 8482.10 through 8482.80 from any other heading; or

A change to subheading 8482.10 through 8482.80 from any other subheading, including another subheading within that group, except from inner or outer races or rings classified in subheading 8482.99.05, 8482.99.15, or

8482.99.25.

8482.91–8482.99 ................ A change to subheading 8482.91 through 8482.99 from any other heading.

8483.10 ............................... A change to subheading 8483.10 from any other subheading.

8483.20 ............................... A change to subheading 8483.20 from any other subheading, except from subheading 8482.10 through 8482.80.

8483.30–8483.60 ................ A change to subheading 8483.30 through 8483.60 from any other subheading, including another subheading within that group.

8483.90 ............................... A change to subheading 8483.90 from any other heading.

8484.10–8484.90 ................ A change to subheading 8484.10 through 8484.90 from any other subheading, including another subheading within that group.

8485 .................................... A change to subheading 8485 from any other heading.

8501 .................................... A change to heading 8501 from any other heading.

8502 .................................... A change to heading 8502 from any other heading.

8503 .................................... A change to heading 8503 from any other heading.

8504.10–8504.50 ................ A change to subheading 8504.10 through 8504.50 from any other subheading outside that group.

8504.90 ............................... A change to subheading 8504.90 from any other heading.

8505.11–8505.30 ................ A change to subheading 8505.11 through 8505.30 from any other subheading, including another subheading within that group.

8505.90 ............................... A change to subheading 8505.90 from any other heading.

8506.10 ............................... A change to subheading 8506.10 from any other subheading; or

A change to a primary cell or battery of maganese dioxide of an external volume not exceeding 300 cm3 of subheading 8506.10 from any other good of subheading 8506.10; or

A change to a primary cell or battery of maganese dioxide of an external volume exceeding 300 cm3 of subheading 8506.10 from any other good of subheading 8506.10.

8506.30 ............................... A change to subheading 8506.30 from any other subheading; or

A change to a primary cell or battery of mercuric oxide of an external volume not exceeding 300 cm3 of subheading 8506.30 from any other good of subheading 8506.30; or

A change to a primary cell or battery of mercuric oxide of an external volume exceeding 300 cm3 of subheading

8506.30 from any other good of subheading 8506.30.

8506.40 ............................... A change to subheading 8506.40 from any other subheading; or

A change to a primary cell or battery of silver oxide of an external volume not exceeding 300 cm3 of subheading

8506.40 from any other good of subheading 8506.40; or

A change to a primary cell or battery of silver oxide of an external volume exceeding 300 cm3 of subheading

8506.40 from any other good of subheading 8506.40.

8506.50–8506.80 ................ A change to subheading 8506.50 through 8506.80 from any other subheading outside that group; or

A change to a primary cell or battery of an external volume not exceeding 300 cm3 of subheading 8506.50

through 8506.80 from any other good of subheading 8506.50 through 8506.80; or

A change to a primary cell or battery of an external volume exceeding 300 cm3 of subheading 8506.50 through

8506.80 from any other good of subheading 8506.50 through 8506.80.

8506.90 ............................... A change to subheading 8506.90 from any other heading.

8507.10–8507.80 ................ A change to subheading 8507.10 through 8507.80 from any other subheading, including another subheading within that group.

8507.90 ............................... A change to subheading 8507.90 from any other heading.

8508.10–8508.80 ................ A change to subheading 8508.10 through 8508.80 from any other subheading, including another subheading within that group.

8508.90 ............................... A change to subheading 8508.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8509.10–8509.80 ................ A change to subheading 8509.10 through 8509.80 from any other subheading, including another subheading within that group.

8509.90 ............................... A change to subheading 8509.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8510.10–8510.30 ................ A change to subheading 8510.10 through 8510.30 from any other subheading, including another subheading within that group.

8510.90 ............................... A change to subheading 8510.90 from any other heading, except from heading 8501 when resulting from a simple

assembly.

8511.10–8511.80 ................ A change to subheading 8511.10 through 8511.80 from any other subheading, including another subheading within that group.

8511.90 ............................... A change to subheading 8511.90 from any other heading.

8512.10–8512.30 ................ A change to subheading 8512.10 through 8512.30 from any other subheading outside that group.

8512.40 ............................... A change to subheading 8512.40 from any other subheading, except from subheading 8512.90 or heading 8501

when resulting from a simple assembly.

8512.90 ............................... A change to subheading 8512.90 from any other heading.
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8513.10 ............................... A change to subheading 8513.10 from any other subheading.

8513.90 ............................... A change to subheading 8513.90 from any other heading.

8514.10–8514.40 ................ A change to subheading 8514.10 through 8514.40 from any other subheading, including another subheading within that group.

8514.90 ............................... A change to subheading 8514.90 from any other heading.

8515.11–8515.80 ................ A change to subheading 8515.11 through 8515.80 from any other subheading outside that group.

8515.90 ............................... A change to subheading 8515.90 from any other heading.

8516.10–8516.79 ................ A change to subheading 8516.10 through 8516.79 from any other subheading, including another subheading within that group.

8516.80 ............................... A change to subheading 8516.80 from any other heading.

8516.90 ............................... A change to subheading 8516.90 from any other heading.

8517.11–8517.80 ................ A change to subheading 8517.11 through 8517.80 from any other subheading outside that group, except from

subheading 8517.90; or

A change to subheading 8517.11 through 8517.80 from subheading 8517.90, provided that the change is not the

result of a simple assembly.

8517.90 ............................... A change to subheading 8517.90 from any other heading.

8518.10–8518.50 ................ A change to subheading 8518.10 through 8518.50 from any other heading.

8518.90 ............................... A change to subheading 8518.90 from any other heading.

8519.10–8519.40 ................ A change to subheading 8519.10 through 8519.40 from any other subheading, including another subheading within that group.

8519.92–8519.93 ................ A change to subheading 8519.92 through 8519.93 from any other subheading outside that group.

8519.99 ............................... A change to subheading 8519.99 from any other subheading.

8520.10–8520.20 ................ A change to subheading 8520.10 through 8520.20 from any other subheading, including another subheading within that group.

8520.32–8520.33 ................ A change to subheading 8520.32 through 8520.33 from any other subheading outside that group.

8520.39–8520.90 ................ A change to subheading 8520.39 through 8520.90 from any other subheading, including another subheading within that group.

8521.10–8521.90 ................ A change to subheading 8521.10 through 8521.90 from any other subheading, including another subheading within that group.

8522 .................................... A change to heading 8522 from any other heading.

8523 .................................... A change to heading 8523 from any other heading.

8524 .................................... A change to heading 8524 from any other heading.

8525.10–8525.20 ................ A change to subheading 8525.10 through 8525.20 from any other subheading outside that group.

8525.30–8525.40 ................ A change to subheading 8525.30 through 8525.40 from any other subheading, including another subheading within that group, except a change to video camera recorders of subheading 8525.40 from television cameras of

subheading 8525.30.

8526.10–8526.92 ................ A change to subheading 8526.10 through 8526.92 from any other subheading, including another subheading within that group.

8527.12–8527.13 ................ A change to subheading 8527.12 through 8527.13 from any other subheading outside that group.

8527.19–8527.90 ................ A change to subheading 8527.19 through 8527.90 from any other subheading, including another subheading within that group.

8528.12–8528.30 ................ A change to subheading 8528.12 through 8528.30 from any other subheading, including another subheading within that group, except from subheading 8540.11 through 8540.12.

8529 .................................... A change to heading 8529 from any other heading.

8530.10–8530.80 ................ A change to subheading 8530.10 through 8530.80 from any other subheading, including another subheading within that group.

8530.90 ............................... A change to subheading 8530.90 from any other heading.

8531.10–8531.80 ................ A change to subheading 8531.10 through 8531.80 from any other subheading, including another subheading within that group, except from subheading 8531.90 when resulting from a simple assembly.

8531.90 ............................... A change to subheading 8531.90 from any other heading.

8532.10–8532.30 ................ A change to subheading 8532.10 through 8532.30 from any other subheading, including another subheading within that group.

8532.90 ............................... A change to subheading 8532.90 from any other heading.

8533.10–8533.40 ................ A change to subheading 8533.10 through 8533.40 from any other subheading, including another subheading within that group.

8533.90 ............................... A change to subheading 8533.90 from any other heading.

8534 .................................... A change to heading 8534 from any other heading.

8535.10–8535.90 ................ A change to subheading 8535.10 through 8535.90 from any other subheading, including another subheading within that group.

8536.10–8536.90 ................ A change to subheading 8536.10 through 8536.90 from any other subheading, including another subheading within that group.

8537 .................................... A change to heading 8537 from any other heading.

8538 .................................... A change to heading 8538 from any other heading.

8539.10–8539.31 ................ A change to subheading 8539.10 through 8539.31 from any other subheading, including another subheading within that group.

8539.32–8539.39 ................ A change to subheading 8539.32 through 8539.39 from any other subheading outside that group.

8539.41–8539.49 ................ A change to subheading 8539.41 through 8539.49 from any other subheading outside that group.

8539.90 ............................... A change to subheading 8539.90 from any other heading.

8540.11–8540.20 ................ A change to subheading 8540.11 through 8540.20 from any other subheading, including another subheading within that group.

8540.40–8540.60 ................ A change to subheading 8540.40 through 8540.60 from any other subheading outside that group.

8540.71–8540.99 ................ A change to subheading 8540.71 through 8540.99 from any other subheading, including another subheading within that group.
28976 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

8540.91–8540.99 ................ A change to subheading 8540.91 through 8540.99 from any other subheading, including another subheading within that group, except when resulting from a simple assembly.

8541–8542 .......................... A change to heading 8541 through 8542 from any other subheading, including another subheading within that

group; or

A change to a mounted chip, die or wafer classified in heading 8541 or 8542 from an unmounted chip, die or

wafer classified in heading 8541 or 8542; or

A change to a programmed ‘‘read only memory’’ (ROM) chip from an unprogrammed ‘‘programmable read only

memory’’ (PROM) chip.

8543.11–8543.19 ................ A change to subheading 8543.11 through 8543.19 from any other subheading outside that group.

8543.20–8543.30 ................ A change to subheading 8543.20 through 8543.30 from any other subheading, including another subheading within that group.

8543.40–8543.89 ................ A change to subheading 8543.40 through 8543.89 from any other subheading outside that group.

8543.90 ............................... A change to subheading 8543.90 from any other heading.

8544.11–8544.70 ................ A change to subheading 8544.11 through 8544.70 from any other subheading, including another subheading within that group, except when resulting from a simple assembly.

8545.11–8547.90 ................ A change to subheading 8545.11 through 8547.90 from any other subheading, including another subheading within that group.

8548 .................................... A change to heading 8548 from any other heading.

(p) Section XVII: Chapters 86 through 89

8601 .................................... A change to heading 8601 from any other heading.

8602 .................................... A change to heading 8602 from any other heading.

8603–8606 .......................... A change to heading 8603 through 8606 from any other heading, including another heading within that group, except from heading 8607 when that change is pursuant to General Rule of Interpretation 2(a).

8607.11 ............................... A change to subheading 8607.11 from any other subheading, except from subheading 8607.12, and except from

subheading 8607.19 when that change is pursuant to General Rule of Interpretation 2(a).

8607.12 ............................... A change to subheading 8607.12 from any other subheading, except from subheading 8607.11, and except from

subheading 8607.19 when that change is pursuant to General Rule of Interpretation 2(a).

8607.19 ............................... A change to subheading 8607.19 from any other subheading.

8607.21–8607.99 ................ A change to subheading 8607.21 through 8607.99 from any other heading, except to mounted brake linings and

pads of subheading 8607.21 through 8607.99 from subheading 6813.10.

8608 .................................... A change to heading 8608 from any other heading.

8609 .................................... A change to heading 8609 from any other heading, except from heading 7309 through 7311.

8701–8705 .......................... A change to heading 8701 through 8705 from any other heading, including another heading within that group, except from heading 8706.

8706 .................................... A change to heading 8706 from any other heading.

8707 .................................... A change to heading 8707 from any other heading, except from subheading 8708.29 when that change is pursuant to General Rule of Interpretation 2(a).

Note: Any change to heading 8708 from subheading 8709.90, 8716.90, 8431.20, or 8431.49 shall not be considered to satisfy a required

change in tariff classification.

8708.10 ............................... A change to subheading 8708.10 from any other subheading.

8708.29 ............................... A change to subheading 8708.29 from any other subheading.

8708.31 ............................... A change to subheading 8708.31 from any other heading, except to mounted brake linings and pads of subheading 8708.31 from subheading 6813.10.

8708.39 ............................... A change to subheading 8708.39 from any other heading.

8708.40 ............................... A change to subheading 8708.40 from any other subheading, except from subheading 8708.99 when that change

is pursuant to General Rule of Interpretation 2(a).

8708.50 ............................... A change to subheading 8708.50 from any other subheading, except from subheading 8708.99 when that change

is pursuant to General Rule of Interpretation 2(a).

8708.60 ............................... A change to subheading 8708.60 from any other subheading.

8708.70 ............................... A change to subheading 8708.70 from any other subheading.

8708.80 ............................... A change to subheading 8708.80 from any other subheading, except from subheading 8708.99 when that change

is pursuant to General Rule of Interpretation 2(a).

8708.91 ............................... A change to subheading 8708.91 from any other subheading, except from subheading 8708.99 when that change

is pursuant to General Rule of Interpretation 2(a).

8708.92 ............................... A change to subheading 8708.92 from any other subheading.

8708.93 ............................... A change to subheading 8708.93 from any other subheading.

8708.94 ............................... A change to subheading 8708.94 from any other subheading, except from subheading 8708.99 when that change

is pursuant to General Rule of Interpretation 2(a).

8708.99 ............................... A change to subheading 8708.99 from any other subheading.

8709.11–8709.19 ................ A change to subheading 8709.11 through 8709.19 from any other subheading outside that group, except from

subheading 8709.90 when that change is pursuant to General Rule of Interpretation 2(a).

8709.90 ............................... A change to subheading 8709.90 from any other heading, except from subheading 8431.20 or heading 8708.

8710 .................................... A change to heading 8710 from any other heading.

8711–8713 .......................... A change to heading 8711 through 8713 from any other heading, including another heading within that group, except from heading 8714 when that change is pursuant to General Rule of Interpretation 2(a).

8714 .................................... A change to heading 8714 from any other heading, except from subheading 6813.10 to mounted brake linings or

pads classified in heading 8714.

8715 .................................... A change to heading 8715 from any other heading.

8716.10–8716.80 ................ A change to subheading 8716.10 through 8716.80 from any other heading, except from subheading 8716.90 when

that change is pursuant to General Rule of Interpretation 2(a).

8716.90 ............................... A change to subheading 8716.90 from any other heading, except from subheading 8709.90 or 8431.49.
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28977

HTSUS Tariff shift and/or other requirements

8801–8802 .......................... A change to heading 8801 through 8802 from any other heading outside that group, except from heading 8803

when that change is pursuant to General Rule of Interpretation 2(a).

8803.10–8803.90 ................ A change to subheading 8803.10 through 8803.90 from any other subheading, including another subheading within that group.

8805 .................................... A change to heading 8805 from any other heading.

8901–8903 .......................... A change to heading 8901 through 8903 from any other heading outside that group.

8904 .................................... A change to heading 8904 from any other heading.

8905 .................................... A change to heading 8905 from any other chapter.

.

8906–8907 .......................... A change to heading 8906 through 8907 from any other heading, including another heading within that group, except from heading 8903 or 8905.

8908 .................................... A change to heading 8908 from any other chapter.

(q) Section XVIII: Chapters 90 through 92

9001.10 ............................... A change to subheading 9001.10 from any other subheading, except from subheading 8544.70.

9001.20–9001.30 ................ A change to subheading 9001.20 through 9001.30 from any other subheading, including another subheading within that group.

9001.40–9001.90 ................ A change to subheading 9001.40 through 9001.90 from any other subheading, including another subheading within that group, except from lens blanks of heading 7014 or subheading 7015.10.

9002.11–9002.90 ................ A change to subheading 9002.11 through 9002.90 from any other subheading, including another subheading within that group, except from subheading 9001.90 or from lens blanks of heading 7014.

9003.11–9003.19 ................ A change to subheading 9003.11 through 9003.19 from any other heading; or

A change to subheading 9003.11 through 9003.19 from any other subheading, including another subheading within that group, except from subheading 9003.90 if the temples or fronts are not domestic materials.

9003.90 ............................... A change to subheading 9003.90 from any other heading.

9004 .................................... A change to heading 9004 from any other heading, except from subheading 9001.40 or 9001.50.

9005.10–9005.80 ................ A change to subheading 9005.10 through 9005.80 from any other subheading, including another subheading within that group.

9005.90 ............................... A change to subheading 9005.90 from any other heading, except from heading 9001 or 9002.

9006.10–9006.69 ................ A change to subheading 9006.10 through 9006.69 from any other subheading, including another subheading within that group.

9006.91–9006.99 ................ A change to subheading 9006.91 through 9006.99 from any other heading.

9007.11–9007.19 ................ A change to subheading 9007.11 through 9007.19 from any other subheading, including another subheading within that group.

9007.20 ............................... A change to subheading 9007.20 from any other subheading; or

A change to a projector for film of less than 16mm width of subheading 9007.20 from any other projector of subheading 9007.20; or

A change from a projector for film of less than 16mm width of subheading 9007.20 to any other projector of subheading 9007.20.

9007.91–9007.92 ................ A change to subheading 9007.91 through 9007.92 from any other heading, except from lenses of heading 9002

when resulting from a simple assembly.

9008.10–9008.40 ................ A change to subheading 9008.10 through 9008.40 from any other subheading, including another subheading within that group.

9008.90 ............................... A change to subheading 9008.90 from any other heading, except from lenses of heading 9002 when resulting

from a simple assembly.

9009.11–9009.30 ................ A change to subheading 9009.11 through 9009.30 from any other subheading, including another subheading within that group.

9009.90 ............................... A change to subheading 9009.90 from any other heading.

9010.10 ............................... A change to subheading 9010.10 from any other subheading.

9010.41–9010.50 ................ A change to subheading 9010.41 through 9010.50 from any other subheading outside that group.

9010.60 ............................... A change to subheading 9010.60 from any other subheading.

9010.90 ............................... A change to subheading 9010.90 from any other heading.

9011.10–9011.80 ................ A change to subheading 9011.10 through 9011.80 from any other subheading, including another subheading within that group.

9011.90 ............................... A change to subheading 9011.90 from any other heading.

9012.10 ............................... A change to subheading 9012.10 from any other subheading, including another subheading within that group.

9012.90 ............................... A change to subheading 9012.90 from any other heading.

9013.10 ............................... A change to subheading 9013.10 from any other subheading, except from optical telescopes of subheading

9005.80.

9013.20–9013.80 ................ A change to subheading 9013.20 through 9013.80 from any other subheading, including another subheading within that group.

9013.90 ............................... A change to subheading 9013.90 from any other subheading, except from subheading 9002.19 when resulting

from a simple assembly.

9014.10–9014.80 ................ A change to subheading 9014.10 through 9014.80 from any other subheading, including another subheading within that group.

9014.90 ............................... A change to subheading 9014.90 from any other heading.

9015.10–9015.80 ................ A change to subheading 9015.10 through 9015.80 from any other subheading, including another subheading within that group.

9015.90 ............................... A change to subheading 9015.90 from any other heading.

9016 .................................... A change to heading 9016 from any other heading.

9017.10–9017.80 ................ A change to subheading 9017.10 through 9017.80 from any other subheading, including another subheading within that group.
28978 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

9017.90 ............................... A change to subheading 9017.90 from any other heading.

9018.11 ............................... A change to subheading 9018.11 from any other subheading, except to electro-cardiographs from printed circuit

assemblies when resulting from a simple assembly.

9018.12–9018.14 ................ A change to subheading 9018.12 through 9018.14 from any other subheading outside that group, except from

subheading 9018.19.

9018.19 ............................... A change to subheading 9018.19 from any other subheading, except to patient monitoring systems from printed

circuit assemblies when resulting from a simple assembly.

9018.20–9018.32 ................ A change to subheading 9018.20 through 9018.32 from any other subheading, including another subheading within that group.

9018.39 ............................... A change to subheading 9018.39 from any other subheading, except from surgical tubing of subheading 4009.10

when resulting from a simple assembly.

9018.41–9018.50 ................ A change to subheading 9018.41 through 9018.50 from any other subheading, including another subheading within that group.

9018.90 ............................... A change to subheading 9018.90 from any other subheading, except from subheading 9001.90 or synthetic rubber

classified in heading 4002 when resulting from a simple assembly; or

A change to defibrillators from printed circuit assemblies, except when resulting from a simple assembly.

9019.10–9019.20 ................ A change to subheading 9019.10 through 9019.20 from any other subheading, including another subheading within that group.

9020 .................................... A change to heading 9020 from any other heading.

9021.11 ............................... A change to subheading 9021.11 from any other subheading, including another subheading within that group.

9021.19 ............................... A change to subheading 9021.19 from any other subheading, except from nails classified in heading 7317 or

screws classified in heading 7318 when resulting from a simple assembly.

9021.21–9021.90 ................ A change to subheading 9021.21 through 9021.90 from any other subheading, including another subheading within that group.

9022.12–9022.14 ................ A change to subheading 9022.12 through 9022.14 from any other subheading outside that group.

9022.19–9022.90 ................ A change to subheading 9022.19 through 9022.90 from any other subheading, including another subheading within that group.

9023 .................................... A change to heading 9023 from any other heading.

9024.10–9024.80 ................ A change to subheading 9024.10 through 9024.80 from any other subheading, including another subheading within that group.

9024.90 ............................... A change to subheading 9024.90 from any other heading.

9025.11–9025.80 ................ A change to subheading 9025.11 through 9025.80 from any other subheading, including another subheading within that group.

9025.90 ............................... A change to subheading 9025.90 from any other heading.

9026.10–9026.80 ................ A change to subheading 9026.10 through 9026.80 from any other subheading, including another subheading within that group.

9026.90 ............................... A change to subheading 9026.90 from any other heading.

9027.10–9027.90 ................ A change to subheading 9027.10 through 9027.90 from any other subheading, including another subheading within that group.

9028.10–9028.30 ................ A change to subheading 9028.10 through 9028.30 from any other subheading, including another subheading within that group.

9028.90 ............................... A change to subheading 9028.90 from any other heading.

9029.10–9029.20 ................ A change to subheading 9029.10 through 9029.20 from any other subheading, including another subheading within that group.

9029.90 ............................... A change to subheading 9029.90 from any other heading.

9030.10–9030.40 ................ A change to subheading 9030.10 through 9030.40 from any other subheading, including another subheading within that group.

9030.82–9030.83 ................ A change to subheading 9030.82 through 9030.83 from any other subheading outside that group.

9030.89–9030.90 ................ A change to subheading 9030.89 through 9030.90 from any other subheading outside that group.

9031.10–9031.30 ................ A change to subheading 9031.10 through 9031.30 from any other subheading, including another subheading within that group.

9031.41–9031.49 ................ A change to subheading 9031.41 through 9031.49 from any other subheading outside that group.

9031.80 ............................... A change to subheading 9031.80 from any other subheading.

9031.90 ............................... A change to subheading 9031.90 from any other heading.

9032.10–9032.89 ................ A change to subheading 9032.10 through 9032.89 from any other subheading, including another subheading within that group.

9032.90 ............................... A change to subheading 9032.90 from any other subheading, except from heading 8537 when resulting from a

simple assembly.

9033 .................................... A change to heading 9033 from any other heading.

Chapter 91 Note: The country of origin of goods classified in subheading 9113.90.40 shall be determined under the provisions of § 102.21.

9101–9107 .......................... A change to heading 9101 through 9107 from any other heading outside that group, except from heading 9108

through 9110; or

A change to heading 9101 through 9107 from complete movements, unassembled, classified in subheading

9110.11 or 9110.90, or from rough movements classified in subheading 9110.19 or 9110.90.

9108–9109 .......................... A change to heading 9108 through 9109 from any other heading outside that group, except from heading 9110; or

A change to heading 9108 through 9109 from complete movements, unassembled, classified in subheading

9110.11 or 9110.90, or from rough movements classified in subheading 9110.19 or 9110.90.

9110 .................................... A change to heading 9110 from any other heading, except from subheading 9114.90.

9111.10–9111.80 ................ A change to subheading 9111.10 through 9111.80 from any other subheading outside that group, except from

subheading 9111.90 when that change is pursuant to General Rule of Interpretation 2(a).

9111.90 ............................... A change to subheading 9111.90 from any other heading.

9112.10–9112.80 ................ A change to subheading 9112.10 through 9112.80 from any other subheading outside that group, except from

subheading 9112.90 when that change is pursuant to General Rule of Interpretation 2(a).

9112.90 ............................... A change to subheading 9112.90 from any other heading.
Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations 28979

HTSUS Tariff shift and/or other requirements

9113 .................................... A change to heading 9113 from any other heading.

9114 .................................... A change to heading 9114 from any other heading.

9201–9208 .......................... A change to heading 9201 through 9208 from any other heading, including another heading within that group, except from heading 9209 when that change is pursuant to General Rule of Interpretation 2(a).

9209 .................................... A change to heading 9209 from any other heading.

(r) Section XIX: Chapter 93

9301–9304 .......................... A change to heading 9301 through 9304 from any other heading, including another heading within that group, except from heading 9305 when that change is pursuant to General Rule of Interpretation 2(a).

9305 .................................... A change to heading 9305 from any other heading.

9306 .................................... A change to heading 9306 from any other heading.

9307 .................................... A change to heading 9307 from any other heading.

(s) Section XX: Chapters 94 through 96

Chapter 94 Note: For a good classifiable in subheadings 9404.30 through 9404.90 which does not meet the appropriate tariff shift rule specified for those subheadings, the country of origin is the country where all cutting and sewing operations required to form the outer shell were

performed. If all cutting and sewing operations required to form the outer shell were not performed in a single country, the country of origin will

be the single country where the component of the outer shell which determines the classification of that good was produced. If a single country

did not produce a component of the outer shell which determines the classification of that good, then the country of origin will be the country in

which the good last underwent a substantial assembly process. Notwithstanding the foregoing provisions of this Note, the country of origin of

goods classified in subheadings 9404.90.10 and 9404.90.80 through 9404.90.95 shall be determined under the provisions of § 102.21.

9401.10–9401.80 ................ A change to subheading 9401.10 through 9401.80 from any other subheading outside that group, except from

subheading 9403.10 through 9403.80, and except from subheading 9401.90 or 9403.90 when that change is

pursuant to General Rule of Interpretation 2(a).

9401.90 ............................... A change to subheading 9401.90 from any other heading, except from subheading 9403.90.

9402 .................................... A change to heading 9402 from any other heading, except from subheading 9401.10 through 9401.80 or subheading 9403.10 through 9403.80, and except from subheading 9401.90 or 9403.90 when that change is pursuant to General Rule of Interpretation 2(a).

9403.10–9403.80 ................ A change to subheading 9403.10 through 9403.80 from any other subheading outside that group, except from

subheading 9401.10 through 9401.80, and except from subheading 9401.90 or 9403.90 when that change is

pursuant to General Rule of Interpretation 2(a).

9403.90 ............................... A change to subheading 9403.90 from any other heading, except from subheading 9401.90.

9404.10–9404.29 ................ A change to subheading 9404.10 through 9404.29 from any other heading.

9404.30–9404.90 ................ A change to down- and/or feather-filled goods classified in subheading 9404.30 through 9404.90 from any other

heading; or

For all other goods classified in subheading 9404.30 through 9404.90, a change from any other heading, except

from heading 5007, 5111 through 5113, 5208 through 5212, 5309 through 5311, 5407 through 5408, 5512

through 5516, 5602 through 5603, 5801 through 5804, 5806, 5809 through 5810, 5901, 5903 through 5904,

5906 through 5907, or 6001 through 6002, or subheading 6307.90.

9405.10–9405.60 ................ A change to subheading 9405.10 through 9405.60 from any other subheading outside that group, except from

subheading 9405.91 through 9405.99 when that change is pursuant to General Rule of Interpretation 2(a).

9405.91–9405.99 ................ A change to subheading 9405.91 through 9405.99 from any other heading.

9406 .................................... A change to heading 9406 from any other heading.

9501 .................................... A change to heading 9501 from any other chapter, except from heading 8714 when that change is pursuant to

General Rule of Interpretation 2(a).

9502.10 ............................... A change to subheading 9502.10 from any other subheading, except from skins for stuffed dolls classified in subheading 9502.99.

9502.99 ............................... A change to subheading 9502.99 from any other heading, except from subheading 9503.41 through 9503.49.

9503.10–9503.30 ................ A change to subheading 9503.10 through 9503.30 from any other subheading, including another subheading within that group.

9503.41–9503.49 ................ A change to toys classified in subheading 9503.41 through 9503.49 from any other heading; or

A change to toys classified in subheading 9503.41 through 9503.49 from parts and accessories classified in subheading 9503.41 through 9503.49; or

A change to parts and accessories classified in subheading 9503.41 through 9503.49 from any other heading, except from heading 9502, 6111, or 6209.

9503.50–9503.60 ................ A change to subheading 9503.50 through 9503.60 from any other subheading, including another subheading within that group.

9503.70–9503.90 ................ A change to subheading 9503.70 through 9503.90 from any other chapter.

9504.10–9506.29 ................ A change to subheading 9504.10 through 9506.29 from any other subheading, including another subheading within that group.

9506.31 ............................... A change to subheading 9506.31 from any other subheading, except from subheading 9506.39.

9506.32–9506.99 ................ A change to subheading 9506.32 through 9506.99 from any other subheading, including another subheading within that group.

9507.10–9507.30 ................ A change to subheading 9507.10 through 9507.30 from any other chapter.

9507.90 ............................... A change to subheading 9507.90 from any other subheading, except from heading 5004 through 5006, subheading 5402.10 through 5402.49, subheading 5406.10 through 5406.20, or heading 5603 or 5404.

9508 .................................... A change to heading 9508 from any other heading.

Chapter 96 Note: The country of origin of goods classified in subheading 9612.10.9010 shall be determined under the provisions of § 102.21.

9601 .................................... A change to heading 9601 from any other heading.

9602 .................................... A change to heading 9602 from any other heading.
28980 Federal Register / Vol. 61, No. 110 / Thursday, June 6, 1996 / Rules and Regulations

HTSUS Tariff shift and/or other requirements

9603 .................................... A change to heading 9603 from any other heading.

9604–9605 .......................... A change to heading 9604 through 9605 from any other heading, including another heading within that group.

9606.10 ............................... A change to subheading 9606.10 from any other heading.

9606.21–9606.29 ................ A change to subheading 9606.21 through 9606.29 from any other heading.

9606.30 ............................... A change to subheading 9606.30 from any other heading.

9607.11–9607.19 ................ A change to subheading 9607.11 through 9607.19 from any other subheading, except from subheading 9607.20

when that change is pursuant to General Rule of Interpretation 2(a).

9607.20 ............................... A change to subheading 9607.20 from any other subheading.

9608.10–9608.40 ................ A change to subheading 9608.10 through 9608.40 from any other subheading, including another subheading within that group, except from subheading 9608.60.

9608.50 ............................... A change to subheading 9608.50 from any other heading.

9608.60–9608.99 ................ A change to subheading 9608.60 through 9608.99 from any other subheading, including another subheading within that group.

9609.10 ............................... A change to subheading 9609.10 from any other subheading.

9609.20 ............................... A change to subheading 9609.20 from any other chapter.

9609.90 ............................... A change to subheading 9609.90 from any other chapter.

9610–9612 .......................... A change to heading 9610 through 9612 from any other heading, including another heading within that group.

9613.10–9613.20 ................ A change to subheading 9613.10 through 9613.20 from any other subheading outside that group.

9613.30–9613.80 ................ A change to subheading 9613.30 through 9613.80 from any other subheading, including another subheading within that group.

9613.90 ............................... A change to subheading 9613.90 from any other heading.

9614.20 ............................... A change to subheading 9614.20 from any other subheading, except to roughly shaped blocks of wood or root of

subheading 9614.20 from heading 4407.

9614.90 ............................... A change to subheading 9614.90 from any other heading.

9615.11–9615.90 ................ A change to subheading 9615.11 through 9615.90 from any other subheading, including another subheading within that group.

9616–9618 .......................... A change to heading 9616 through 9618 from any other heading, including another heading within that group.

(t) Section XXI: Chapter 97

9701.10–9701.90 ................ A change to subheading 9701.10 through 9701.90 from any other subheading, including another subheading within that group.

9702–9706 .......................... A change to heading 9702 through 9706 from any other heading, including another heading within that group.

PART 134—COUNTRY OF ORIGIN

MARKING

1. The authority citation for part 134

continues to read as follows:

Authority: 5 U.S.C. 301; 19 U.S.C. 66, 1202

(General Note 20, Harmonized Tariff

Schedule of the United States), 1304, 1624.

§ 134.32 [Amended]

2. In § 134.32, paragraph (r) is

removed.

3. In § 134.43, paragraph (e) is revised

to read as follows:

§ 134.43 Methods of marking specific

articles.

* * * * *

(e) Assembled articles. Where an

article is produced as a result of an

assembly operation and the country of

origin of such article is determined

under this chapter to be the country in

which the article was finally assembled,

such article may be marked, as

appropriate, in a manner such as the

following:

(1) Assembled in (country of final

assembly);

(2) Assembled in (country of final

assembly) from components of (name of

country or countries of origin of all

components); or

(3) Made in, or product of, (country of

final assembly).

Michael H. Lane,

Acting Commissioner of Customs.

Approved: May 29, 1996.

John P. Simpson,

Deputy Assistant Secretary of the Treasury.

[FR Doc. 96–14027 Filed 6–5–96; 8:45 am]

BILLING CODE 4820–02–P