H. R. 4759—12 
(F) A nonoriginating material provided for in chapter 
17 of the HTS or heading 1805.00.00 that is used in the 
production of a good provided for in subheading 1806.10. 
(G) A nonoriginating material provided for in any of 
headings 2203 through 2208 that is used in the production 
of a good provided for in heading 2207 or 2208. 
(H) A nonoriginating material used in the production 
of a good provided for in any of chapters 1 through 21 
of the HTS unless the nonoriginating material is provided 
for in a different subheading than the good for which 
origin is being determined under this section. 
(3) TEXTILE AND APPAREL GOODS.— 
(A) IN GENERAL.—Except as provided in subparagraph 
(B), a textile or apparel good that is not an originating 
good because certain fibers or yarns used in the production 
of the component of the good that determines the tariff 
classification of the good do not undergo an applicable 
change in tariff classification set out in Annex 4–A of 
the Agreement shall be considered to be an originating 
good if the total weight of all such fibers or yarns in 
that component is not more than 7 percent of the total 
weight of that component. 
(B) CERTAIN TEXTILE OR APPAREL GOODS.—A textile 
or apparel good containing elastomeric yarns in the compo-
nent of the good that determines the tariff classification 
of the good shall be considered to be an originating good 
only if such yarns are wholly formed in the territory of 
Australia or the United States. 
(C) YARN, FABRIC, OR FIBER.—For purposes of this para-
graph, in the case of a textile or apparel good that is 
a yarn, fabric, or group of fibers, the term ‘‘component 
of the good that determines the tariff classification of the 
good’’ means all of the fibers in the yarn, fabric, or group 
of fibers. 
(d) ACCUMULATION.— 
(1) ORIGINATING MATERIALS USED IN PRODUCTION OF GOODS 
OF OTHER COUNTRY.—Originating materials from the territory 
of Australia or the United States that are used in the production 
of a good in the territory of the other country shall be considered 
to originate in the territory of the other country. 
(2) MULTIPLE PROCEDURES.—A good that is produced in 
the territory of Australia, the United States, or both, by 1 
or more producers, is an originating good if the good satisfies 
the requirements of subsection (b) and all other applicable 
requirements of this section. 
(e) REGIONAL VALUE-CONTENT.— 
(1) IN
GENERAL.—For purposes of subsection (b)(2), the 
regional value-content of a good referred to in Annex 5–A 
of the Agreement, except for goods to which paragraph (4) 
applies, shall be calculated by the importer, exporter, or pro-
ducer of the good, on the basis of the build-down method 
described in paragraph (2) or the build-up method described 
in paragraph (3). 
(2) BUILD-DOWN METHOD.— 
(A) IN GENERAL.—The regional value-content of a good 
may be calculated on the basis of the following build- 
down method:
H. R. 4759—13 
AV–VNM 
RVC = ———— × 100 
AV 
(B) DEFINITIONS.—In subparagraph (A): 
(i) RVC.—The term ‘‘RVC’’ means the regional 
value-content of the good, expressed as a percentage. 
(ii) AV.—The term ‘‘AV’’ means the adjusted value 
of the good. 
(iii) VNM.—The term ‘‘VNM’’ means the value of 
nonoriginating materials that are acquired and used 
by the producer in the production of the good, but 
does not include the value of a material that is self- 
produced. 
(3) BUILD-UP METHOD.— 
(A) IN GENERAL.—The regional value-content of a good 
may be calculated on the basis of the following build- 
up method: 
VOM 
RVC = ———— × 100 
AV 
(B) DEFINITIONS.—In subparagraph (A): 
(i) RVC.—The term ‘‘RVC’’ means the regional 
value-content of the good, expressed as a percentage. 
(ii) AV.—The term ‘‘AV’’ means the adjusted value 
of the good. 
(iii) VOM.—The term ‘‘VOM’’ means the value of 
originating materials that are acquired or self-pro-
duced, and used by the producer in the production 
of the good. 
(4) SPECIAL RULE FOR CERTAIN AUTOMOTIVE GOODS.— 
(A) IN
GENERAL.—For purposes of subsection (b)(2), 
the regional value-content of an automotive good referred 
to in Annex 5–A of the Agreement shall be calculated 
by the importer, exporter, or producer of the good, on 
the basis of the following net cost method: 
NC–VNM 
RVC = ———— × 100 
NC 
(B) DEFINITIONS.—In subparagraph (A): 
(i) AUTOMOTIVE
GOOD.—The term ‘‘automotive 
good’’ means a good provided for in any of subheadings 
8407.31 through 8407.34, subheading 8408.20, heading 
8409, or in any of headings 8701 through 8708. 
(ii) RVC.—The term ‘‘RVC’’ means the regional 
value-content of the automotive good, expressed as a 
percentage. 
(iii) NC.—The term ‘‘NC’’ means the net cost of 
the automotive good. 
(iv) VNM.—The term ‘‘VNM’’ means the value of 
nonoriginating materials that are acquired and used 
by the producer in the production of the automotive 
good, but does not include the value of a material 
that is self-produced. 
(C) MOTOR VEHICLES.—
H. R. 4759—14 
(i) BASIS OF CALCULATION.—For purposes of deter-
mining the regional value-content under subparagraph 
(A) for an automotive good that is a motor vehicle 
provided for in any of headings 8701 through 8705, 
an importer, exporter, or producer may average the 
amounts calculated under the formula contained in 
subparagraph (A), over the producer’s fiscal year— 
(I) with respect to all motor vehicles in any 
one of the categories described in clause (ii); or 
(II) with respect to all motor vehicles in any 
such category that are exported to the territory 
of the United States or Australia. 
(ii) CATEGORIES.—A category is described in this 
clause if it— 
(I) is the same model line of motor vehicles, 
is in the same class of vehicles, and is produced 
in the same plant in the territory of Australia 
or the United States, as the good described in 
clause (i) for which regional value-content is being 
calculated; 
(II) is the same class of motor vehicles, and 
is produced in the same plant in the territory 
of Australia or the United States, as the good 
described in clause (i) for which regional value- 
content is being calculated; or 
(III) is the same model line of motor vehicles 
produced in either the territory of Australia or 
the United States, as the good described in clause 
(i) for which regional value-content is being cal-
culated. 
(D) OTHER AUTOMOTIVE GOODS.—For purposes of deter-
mining the regional value-content under subparagraph (A) 
for automotive goods provided for in any of subheadings 
8407.31 through 8407.34, in subheading 8408.20, or in 
heading 8409, 8706, 8707, or 8708, that are produced in 
the same plant, an importer, exporter, or producer may— 
(i) average the amounts calculated under the for-
mula contained in subparagraph (A) over— 
(I) the fiscal year of the motor vehicle producer 
to whom the automotive goods are sold, 
(II) any quarter or month, or 
(III) its own fiscal year, 
if the goods were produced during the fiscal year, 
quarter, or month that is the basis for the calculation; 
(ii) determine the average referred to in clause 
(i) separately for such goods sold to one or more motor 
vehicle producers; or 
(iii) make a separate determination under clause 
(i) or (ii) for automotive goods that are exported to 
the territory of the United States or Australia. 
(E) CALCULATING
NET
COST.—Consistent with the 
provisions regarding allocation of costs set out in generally 
accepted accounting principles, the net cost of the auto-
motive good under subparagraph (B) shall be calculated 
by— 
(i) calculating the total cost incurred with respect 
to all goods produced by the producer of the automotive
H. R. 4759—15 
good, subtracting any sales promotion, marketing and 
after-sales service costs, royalties, shipping and 
packing costs, and nonallowable interest costs that are 
included in the total cost of all such goods, and then 
reasonably allocating the resulting net cost of those 
goods to the automotive good; 
(ii) calculating the total cost incurred with respect 
to all goods produced by that producer, reasonably 
allocating the total cost to the automotive good, and 
then subtracting any sales promotion, marketing and 
after-sales service costs, royalties, shipping and 
packing costs, and nonallowable interest costs that are 
included in the portion of the total cost allocated to 
the automotive good; or 
(iii) reasonably allocating each cost that forms part 
of the total cost incurred with respect to the automotive 
good so that the aggregate of these costs does not 
include any sales promotion, marketing and after-sales 
service costs, royalties, shipping and packing costs, 
or nonallowable interest costs. 
(f) VALUE OF MATERIALS.— 
(1) IN
GENERAL.—For the purpose of calculating the 
regional value-content of a good under subsection (e), and for 
purposes of applying the de minimis rules under subsection 
(c), the value of a material is— 
(A) in the case of a material that is imported by the 
producer of the good, the adjusted value of the material; 
(B) in the case of a material acquired in the territory 
in which the good is produced, the value, determined in 
accordance with Articles 1 through 8, article 15, and the 
corresponding interpretive notes of the Agreement on 
Implementation of Article VII of the General Agreement 
on Tariffs and Trade 1994 referred to in section 101(d)(8) 
of the Uruguay Round Agreements Act, as set forth in 
regulations promulgated by the Secretary of the Treasury 
providing for the application of such Articles in the absence 
of an importation; or 
(C) in the case of a material that is self-produced, 
the sum of— 
(i) all expenses incurred in the production of the 
material, including general expenses; and 
(ii) an amount for profit equivalent to the profit 
added in the normal course of trade. 
(2) FURTHER ADJUSTMENTS TO THE VALUE OF MATERIALS.— 
(A) ORIGINATING MATERIAL.—The following expenses, 
if not included in the value of an originating material 
calculated under paragraph (1), may be added to the value 
of the originating material: 
(i) The costs of freight, insurance, packing, and 
all other costs incurred in transporting the material 
within or between the territory of Australia, the United 
States, or both, to the location of the producer. 
(ii) Duties, taxes, and customs brokerage fees on 
the material paid in the territory of Australia, the 
United States, or both, other than duties or taxes 
that are waived, refunded, refundable, or otherwise