83_FR_9057 83 FR 9015 - Notice of Issuance of Final Determination Concerning Country of Origin of Aluminum Honeycomb Panels

83 FR 9015 - Notice of Issuance of Final Determination Concerning Country of Origin of Aluminum Honeycomb Panels

DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection

Federal Register Volume 83, Issue 42 (March 2, 2018)

Page Range9015-9017
FR Document2018-04279

This document provides notice that U.S. Customs and Border Protection (``CBP'') has issued a final determination concerning the country of origin of aluminum honeycomb panels. CBP has concluded in the final determination that for purposes of U.S. Government procurement the assembly of the parts in the United States does not substantially transform the aluminum panels.

Federal Register, Volume 83 Issue 42 (Friday, March 2, 2018)
[Federal Register Volume 83, Number 42 (Friday, March 2, 2018)]
[Notices]
[Pages 9015-9017]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-04279]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Notice of Issuance of Final Determination Concerning Country of 
Origin of Aluminum Honeycomb Panels

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

ACTION: Notice of final determination.

-----------------------------------------------------------------------

SUMMARY: This document provides notice that U.S. Customs and Border 
Protection (``CBP'') has issued a final determination concerning the 
country of origin of aluminum honeycomb panels. CBP has concluded in 
the final determination that for purposes of U.S. Government 
procurement the assembly of the parts in the United States does not 
substantially transform the aluminum panels.

DATES: The final determination was issued on February 21, 2018. A copy 
of the final determination is attached. Any party-at-interest, as 
defined in 19 C.F.R. Sec.  177.22(d), may seek judicial review of this 
final determination within April 2, 2018.

FOR FURTHER INFORMATION CONTACT: Joy Marie Virga, Valuation and Special 
Programs Branch, Regulations and Rulings, Office of Trade (202-325-
1511).

SUPPLEMENTARY INFORMATION: Notice is hereby given that on 02/21/18, CBP 
issued a final determination concerning the aluminum honeycomb panels, 
which may be offered to the United States Government under an 
undesignated government procurement contract. The final determination, 
HQ H290528, was issued at the request of Aliva Chemica E Sistemi SRL, 
under procedures set forth at 19 C.F.R. Part 177, subpart B, which 
implements Title III of the Trade Agreements Act of 1979, as amended 
(19 U.S.C. Sec.  2511-18). In the final determination, CBP was asked to 
consider whether the cutting, bending, and assembly of aluminum parts 
constitutes a substantial transformation. In the final determination, 
CBP concluded that these activities do not constitute a substantial 
transformation and the origin of the honeycomb panels remains the 
original country of manufacturing.
    Section 177.29, CBP Regulations (19 C.F.R. Sec.  177.29), provides 
that notice of final determinations shall be published in the Federal 
Register within 60 days of the date the final determination is issued. 
Section 177.30, CBP Regulations (19 C.F.R. Sec.  177.30), provides that 
any party-at-interest, as defined in 19 C.F.R. Sec.  177.22(d), may 
seek judicial review of a final determination within 30 days of 
publication of such determination in the Federal Register.

    Dated: February 21, 2018.
Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.

HQ H290528

February 21, 201

OT:RR:CTF:VS: H290528 JMV

CATEGORY: Origin

Darlene Buro
All Air Custom Brokers, Inc.
145-68 228th Street, 2nd Floor
Springfield Gardens, NY11413

    RE: U.S. Government Procurement; Title III, Trade Agreements Act 
of 1979 (19 U.S.C. Sec.  2511); Subpart B, Part 177, CBP 
Regulations; Country of Origin of Honeycomb Panels

Dear Ms. Buro,
    This is in response to your request of June 5, 2017, on behalf 
of Aliva Chemica E Sistemi SRL (``Aliva'') for a final determination 
concerning the country of origin of a product that you refer to as 
``aluminum honeycomb panels,'' pursuant to subpart B of Part 177, 
U.S. Customs and Border Protection (CBP) Regulations (19 C.F.R. 
Sec.  177.21, et seq.).
    As a foreign producer of merchandise, Aliva is a party-at-
interest within the meaning of 19 C.F.R. Sec.  177.22(d)(1) and is 
entitled to request this final determination.

FACTS:

    The merchandise at issue are Aliva aluminum honeycomb panels, 
which will be used as architectural finished coating panels for wall 
and tunnel areas in train stations. The panels come in two 
variations: straight and curved. Each installed panel will contain a 
casing, a core, and two mounting blades.

The casing

    The casing is a flat sheet of pre-painted aluminum alloy which 
will be supplied in both perforated and non-perforated variations as 
required for aesthetic appearance. The flat sheet is produced in 
Italy in dimensions of two feet in width and variable lengths. These 
aluminum alloy sheets are painted through a reverse coil process and 
will include anti-graffiti characteristics as required by the 
architectural specification. The sheets are then transferred to a 
specialized processing factory in Italy that cuts the sheet to the 
final dimensions, and bends three of the side edges to create the 
casing that will house the honeycomb core. Along one side of the 
casing, the edge is left flat and two bending lines are engraved on 
the back of this edge for reference during the production process in 
the United States. The casing will then be transported to a U.S. 
production facility to receive and secure the core. Workers at the 
U.S. production facility will also drill holes at prescribed 
locations to attach the core.

The core

    The core consists of two hard layers called skins and a layer of 
aluminum honeycomb made up of 3000 series aluminum alloy with 
hexagonal cells that are 80 microns thick. The skins can either be 
coated with five microns of primer or pre-painted black with an 
anti-graffiti finish. The skins are glued to the honeycomb panel to 
create a singular panel referred to as the core.
    The Italian manufacturer will supply and transport the core 
sheets in bulk to a U.S. manufacturing facility. Each core sheet 
will produce three to 16 cores. All cores for the curved panels will 
be cut-to-size to fit the casing in Italy but cores for the straight 
panels will be cut to size at the U.S. facility. Eight holes are 
drilled through the back of the core for attachment of the mounting 
blades. However, all the cores for curved panels will be cut and 
drilled in Italy.

The mounting blades

    The mounting blades are aluminum alloy sheets of unknown origin 
extruded into L-shaped brackets. Two mounting blades will be 
attached to the back of each core on either side. The mounting 
blades are extruded, machined, bent, and cut-to-size in the United 
States before being secured to the core. Two different profiles are 
produced for the right and left blades, which hook the finished 
panel onto Aliva's framing system.

Assembly

    In the United States, the core is inserted into the case and 
then the flat edge of each casing will be bent into place with 
specialized aluminum bending equipment. An average of 16 holes will 
be drilled into each panel, and 16 stainless steel rivets will be 
fastened with a specialized riveting tool to secure the core and 
casing together. Finally, each mounting blade is secured to the 
finished panel with four stainless steel rivets.
    According to Aliva, the processing in the United States requires 
skilled labor and increases the value of the component parts. Aliva 
estimates that the work required to incorporate the casing, core and 
mounting blades into a singular panel in the United States will take 
approximately 46 minutes of labor. The importer further states that 
the processes performed in the United States to produce all of the 
panels will require ``hundreds of thousands of dollars of labor.'' 
Aliva indicates that each panel will have a significantly increased 
value over the collective value of the individual parts (casing, 
core, and mounting blades) after the processing in the United States 
is completed.

[[Page 9016]]

ISSUE:

    Whether the component aluminum parts are substantially 
transformed by the combining processes in the United States.

LAW AND ANALYSIS:

    CBP issues country of origin advisory rulings and final 
determinations as to whether an article is or would be a product of 
a designated country or instrumentality for the purposes of granting 
waivers of certain ``Buy American'' restrictions in U.S. law or 
practice for products offered for sale to the U.S. Government, 
pursuant to subpart B of Part 177, 19 C.F.R. Sec.  177.21 et seq., 
which implements Title III of the Trade Agreements Act of 1979, as 
amended (19 U.S.C. Sec.  2511 et seq.).

Under the rule of origin set forth under 19 U.S.C. Sec.  2518(4)(B):
An article is a product of a country or instrumentality only if (i) 
it is wholly the growth, product, or manufacture of that country or 
instrumentality, or (ii) in the case of an article which consists in 
whole or in part of materials from another country or 
instrumentality, it has been substantially transformed into a new 
and different article of commerce with a name, character, or use 
distinct from that of the article or articles from which it was so 
transformed.

See also 19 C.F.R. Sec.  177.22(a).

    In rendering final determinations for purposes of U.S. 
Government procurement, CBP applies the provisions of subpart B of 
Part 177 consistent with the Federal Procurement Regulations. See 19 
C.F.R. Sec.  177.21. In this regard, CBP recognizes that the Federal 
Acquisition Regulations restrict the U.S. Government's purchase of 
products to U.S.-made or designated country end products for 
acquisitions subject to the Trade Agreements Act. See 48 C.F.R. 
Sec.  25.403(c)(1). The Federal Acquisition Regulations define 
``U.S.-made end product'' as ``an article that is mined, produced, 
or manufactured in the United States or that is substantially 
transformed in the United States into a new and different article of 
commerce with name, character, or use distinct from that of the 
article or articles from which it was transformed.'' See 48 C.F.R 
Sec.  25.003.
    In determining whether the combining of parts constitutes a 
substantial transformation, the determinative issue for CBP is the 
extent of operations performed and whether the parts lose their 
identity and become an integral part of the new article. Belcrest 
Linens v. United States, 6 C.I.T. 204 (1983), aff'd, 741 F.2d 1368 
(Fed. Cir. 1984). Assembly operations that are minimal or simple, as 
opposed to complex or meaningful, will generally not result in a 
substantial transformation. See HQ H125975, dated January 19, 2011. 
CBP considers the totality of the circumstances and makes such 
determinations on a case-by-case basis.
    In determining whether a substantial transformation has occurred 
in the processing of metals, CBP has generally held that cutting or 
bending materials to defined shapes or patterns suitable for use in 
making finished articles, as opposed to mere cutting to length or 
width which does not render the article suitable for a particular 
use, constitutes a substantial transformation. For example, in 
Headquarters Ruling Letter (``HRL'') 055684, dated August 14, 1979, 
CBP held that components of a water cooler gas absorption 
refrigeration unit which were formed by cutting to length, cleaning 
and bending imported steel tubes into the component shapes and 
configurations, or by cutting to length, flattening, and drilling 
holes into imported tubing, substantially transformed constituent 
materials for GSP purposes, while those imported tubes which were 
simply cut to length and assembled into the final articles were not. 
See also HRL 555811, dated March 20, 1992 (die cutting, stamping and 
shaping operations substantially transform aluminum flat stock into 
new and different articles of commerce).
    In HRL 555265, dated July 3, 1989, CBP held rolls of imported 
aluminum strip were substantially transformed when the aluminum 
strip was crowned, that is, it was passed between convexed and 
concaved egg shape rollers to permanently bow the strip. Then the 
strip was cut to lengths and punched with holes. CBP stated that the 
cutting and crowning operations permanently altered the physical 
characteristics of the strip thereby limiting its potential uses. 
Prior to cutting and crowning, the strip was raw material and 
possessed nothing in its character indicative of its ultimate use. 
After the cutting and crowning operations, the strip could be used 
in the production of a limited range of articles, such as venetian 
blind slats or lattice fences. See also HRL 557159, dated January 
11, 1994 (extruded aluminum cut to length and bent to shape to form 
the frame of grilles and louvers was substantially transformed).
    The above situations are in contrast to those where the imported 
components constitute the essence of the end product. For example, 
in HRL 562653, dated May 14, 2003, CBP considered whether brake kits 
that were machined and assembled in the United States were 
substantially transformed. Unplated, drilled and slotted brake 
rotors and calipers from Italy were plated with a protective zinc 
coating and some of the calipers were painted/labeled. After 
painting, the calipers were machined to specification, in accordance 
with the mounting profile determined by engineers. The two imported 
plated rotors were each mounted to a U.S.-origin bell by means of 
ten small bushing assemblies, each of which was comprised of a 
bushing, spacer, spring washer and bolt. The bushing and the spring 
were imported from Italy, while the remaining articles were of U.S.-
origin. CBP found that, at importation, both the rotors and the 
calipers were not rough, generic forms with a multitude of uses, but 
were essentially complete articles which already bore the name of 
the finished product; therefore, the use of the articles was 
determined at the time of importation. While the calipers underwent 
some machining operations in the United States, the overall shape 
and form of the finished articles was essentially the same as the 
imported articles. Likewise, although all of the rotors were plated 
in the United States, and some underwent additional drilling and/or 
slotting in the United States, the overall dimensions and diameter 
remained the same. The imported rotors also did not lose their 
identity and did not become an integral part of a new article when 
assembled to the U.S. bell. Additionally, the use of the calipers 
and rotors was predetermined at importation. Thus, CBP found that 
the imported rotors and calipers did not undergo a change in name, 
character or use as a result of processing in the United States and 
remained products of Italy. See also HRL 734873, dated September 7, 
1994 (imported brake rotor castings were not substantially 
transformed by processing, which included removing 0.06-0.12 inches 
of external surface, drilling 5-10 holes, counter coring, installing 
studs or bolts, and grounding for a fine finish); and National Hand 
Tool Corp. v. United States, 16 C.I.T. 308 (1992) (finding no 
substantial transformation occurred because components had been 
cold-formed or hot-forged ``into their final shape before 
importation'', and that ``the form of the components remained the 
same'' after the assembly and heat-treatment processes performed in 
the United States).
    Here, the U.S processing of the panels is minimal and does not 
alter the character of the casing and core. The pre-importation 
processing is significantly more complicated than the post-
importation processing, which essentially consists of some cutting 
and assembly of parts. The physical characteristics of the casing 
and the core are already determined by the processing in Italy. Most 
of the cutting and bending of the casing and the core occurs prior 
to importation. In Italy, the aluminum sheets are produced; the core 
is created by linking the skins with the aluminum honeycomb; the 
aluminum for the casing is cut to size; the casing is painted; three 
of the four bends in the casing are completed; the core is primed 
and painted; and the curved core panels are cut. In contrast, in the 
United States the last edge of the casing is bent, the straight core 
panels are cut, the core and the casing are attached, and the 
mounting blades are cut into shape and attached; thus, the form of 
the components remains essentially the same after U.S. processing. 
Since the form, materials, and structure remain the same, we find 
there is no change in character of the core and casing.
    The processing here is similar to the brake kits in HRL 562653. 
The major parts are imported in essentially the same shape that they 
will be in when assembled into the final product. Although there is 
some cutting, drilling, and slotting, the casing and the core do not 
lose their identity or become an integral part of a new article when 
assembled in the United States. Like the brake kits, at importation 
the casing and core are not rough, generic forms with a multitude of 
uses--they are imported only to be assembled to be sold as wall 
panels. Therefore, the casing and core are not new and different 
articles of commerce from the assembled panels.
    Here, because the core and the casing are not substantially 
transformed in the United States, the country of origin of the 
completed panels is Italy.

HOLDING:

    Based on the facts of this case, aluminum honeycomb panels are 
not substantially

[[Page 9017]]

transformed through the assembly of the parts in the United States. 
The country of origin of the aluminum honeycomb panels is Italy.
    Notice of this final determination will be given in the Federal 
Register, as required by 19 C.F.R. Sec.  177.29. Any party-at-
interest other than the party which requested this final 
determination may request, pursuant to 19 C.F.R. Sec.  177.31, that 
CBP reexamine the matter anew and issue a new final determination. 
Pursuant to 19 C.F.R. Sec.  177.30, any party-at-interest may, 
within 30 days of publication of the Federal Register Notice 
referenced above, seek judicial review of this final determination 
before the Court of International Trade.
Sincerely,
Alice A. Kipel, Executive Director
Regulations and Rulings
Office of International Trade

[FR Doc. 2018-04279 Filed 3-1-18; 8:45 am]
 BILLING CODE P



                                                                               Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices                                                    9015

                                               determination. Pursuant to 19 C.F.R.                    parts constitutes a substantial                       then transferred to a specialized processing
                                               § 177.30, any party-at-interest may, within 30          transformation. In the final                          factory in Italy that cuts the sheet to the final
                                               days of publication of the Federal Register             determination, CBP concluded that                     dimensions, and bends three of the side
                                               Notice referenced above, seek judicial review                                                                 edges to create the casing that will house the
                                               of this final determination before the Court
                                                                                                       these activities do not constitute a
                                                                                                                                                             honeycomb core. Along one side of the
                                               of International Trade.                                 substantial transformation and the
                                                                                                                                                             casing, the edge is left flat and two bending
                                                                                                       origin of the honeycomb panels remains                lines are engraved on the back of this edge
                                               Sincerely,
                                                                                                       the original country of manufacturing.                for reference during the production process
                                               Alice A. Kipel, Executive Director                         Section 177.29, CBP Regulations (19                in the United States. The casing will then be
                                               Regulations & Rulings                                   C.F.R. § 177.29), provides that notice of             transported to a U.S. production facility to
                                               Office of Trade                                         final determinations shall be published               receive and secure the core. Workers at the
                                               [FR Doc. 2018–04278 Filed 3–1–18; 8:45 am]              in the Federal Register within 60 days                U.S. production facility will also drill holes
                                               BILLING CODE P
                                                                                                       of the date the final determination is                at prescribed locations to attach the core.
                                                                                                       issued. Section 177.30, CBP Regulations               The core
                                                                                                       (19 C.F.R. § 177.30), provides that any
                                                                                                       party-at-interest, as defined in 19 C.F.R.               The core consists of two hard layers called
                                               DEPARTMENT OF HOMELAND
                                                                                                                                                             skins and a layer of aluminum honeycomb
                                               SECURITY                                                § 177.22(d), may seek judicial review of
                                                                                                                                                             made up of 3000 series aluminum alloy with
                                                                                                       a final determination within 30 days of               hexagonal cells that are 80 microns thick.
                                               U.S. Customs and Border Protection                      publication of such determination in the              The skins can either be coated with five
                                                                                                       Federal Register.                                     microns of primer or pre-painted black with
                                               Notice of Issuance of Final
                                                                                                         Dated: February 21, 2018.                           an anti-graffiti finish. The skins are glued to
                                               Determination Concerning Country of                                                                           the honeycomb panel to create a singular
                                               Origin of Aluminum Honeycomb                            Alice A. Kipel,
                                                                                                                                                             panel referred to as the core.
                                               Panels                                                  Executive Director, Regulations and Rulings,
                                                                                                                                                                The Italian manufacturer will supply and
                                                                                                       Office of Trade.
                                               AGENCY:  U.S. Customs and Border                                                                              transport the core sheets in bulk to a U.S.
                                               Protection, Department of Homeland                      HQ H290528                                            manufacturing facility. Each core sheet will
                                                                                                                                                             produce three to 16 cores. All cores for the
                                               Security.                                               February 21, 201                                      curved panels will be cut-to-size to fit the
                                               ACTION: Notice of final determination.                                                                        casing in Italy but cores for the straight
                                                                                                       OT:RR:CTF:VS: H290528 JMV
                                                                                                                                                             panels will be cut to size at the U.S. facility.
                                               SUMMARY:    This document provides                      CATEGORY: Origin                                      Eight holes are drilled through the back of
                                               notice that U.S. Customs and Border                                                                           the core for attachment of the mounting
                                               Protection (‘‘CBP’’) has issued a final                 Darlene Buro
                                                                                                       All Air Custom Brokers, Inc.                          blades. However, all the cores for curved
                                               determination concerning the country of                 145–68 228th Street, 2nd Floor                        panels will be cut and drilled in Italy.
                                               origin of aluminum honeycomb panels.                    Springfield Gardens, NY11413
                                               CBP has concluded in the final                                                                                The mounting blades
                                                                                                          RE: U.S. Government Procurement; Title
                                               determination that for purposes of U.S.                                                                         The mounting blades are aluminum alloy
                                                                                                       III, Trade Agreements Act of 1979 (19 U.S.C.
                                               Government procurement the assembly                                                                           sheets of unknown origin extruded into L-
                                                                                                       § 2511); Subpart B, Part 177, CBP
                                               of the parts in the United States does                                                                        shaped brackets. Two mounting blades will
                                                                                                       Regulations; Country of Origin of Honeycomb
                                               not substantially transform the                                                                               be attached to the back of each core on either
                                                                                                       Panels
                                                                                                                                                             side. The mounting blades are extruded,
                                               aluminum panels.                                        Dear Ms. Buro,                                        machined, bent, and cut-to-size in the United
                                               DATES: The final determination was                         This is in response to your request of June        States before being secured to the core. Two
                                               issued on February 21, 2018. A copy of                  5, 2017, on behalf of Aliva Chemica E Sistemi         different profiles are produced for the right
                                               the final determination is attached. Any                SRL (‘‘Aliva’’) for a final determination             and left blades, which hook the finished
                                               party-at-interest, as defined in 19 C.F.R.              concerning the country of origin of a product
                                                                                                                                                             panel onto Aliva’s framing system.
                                                                                                       that you refer to as ‘‘aluminum honeycomb
                                               § 177.22(d), may seek judicial review of                panels,’’ pursuant to subpart B of Part 177,          Assembly
                                               this final determination within April 2,                U.S. Customs and Border Protection (CBP)
                                               2018.                                                                                                            In the United States, the core is inserted
                                                                                                       Regulations (19 C.F.R. § 177.21, et seq.).            into the case and then the flat edge of each
                                               FOR FURTHER INFORMATION CONTACT: Joy                       As a foreign producer of merchandise,              casing will be bent into place with
                                               Marie Virga, Valuation and Special                      Aliva is a party-at-interest within the
                                                                                                                                                             specialized aluminum bending equipment.
                                               Programs Branch, Regulations and                        meaning of 19 C.F.R. § 177.22(d)(1) and is
                                                                                                                                                             An average of 16 holes will be drilled into
                                               Rulings, Office of Trade (202–325–                      entitled to request this final determination.
                                                                                                                                                             each panel, and 16 stainless steel rivets will
                                               1511).                                                  FACTS:                                                be fastened with a specialized riveting tool to
                                               SUPPLEMENTARY INFORMATION: Notice is                      The merchandise at issue are Aliva                  secure the core and casing together. Finally,
                                                                                                       aluminum honeycomb panels, which will be              each mounting blade is secured to the
                                               hereby given that on 02/21/18, CBP                                                                            finished panel with four stainless steel rivets.
                                               issued a final determination concerning                 used as architectural finished coating panels
                                                                                                       for wall and tunnel areas in train stations.             According to Aliva, the processing in the
                                               the aluminum honeycomb panels,                                                                                United States requires skilled labor and
                                                                                                       The panels come in two variations: straight
                                               which may be offered to the United                      and curved. Each installed panel will contain         increases the value of the component parts.
                                               States Government under an                              a casing, a core, and two mounting blades.            Aliva estimates that the work required to
                                               undesignated government procurement                                                                           incorporate the casing, core and mounting
                                               contract. The final determination, HQ                   The casing                                            blades into a singular panel in the United
                                               H290528, was issued at the request of                     The casing is a flat sheet of pre-painted           States will take approximately 46 minutes of
                                               Aliva Chemica E Sistemi SRL, under                      aluminum alloy which will be supplied in              labor. The importer further states that the
daltland on DSKBBV9HB2PROD with NOTICES




                                               procedures set forth at 19 C.F.R. Part                  both perforated and non-perforated variations         processes performed in the United States to
                                                                                                       as required for aesthetic appearance. The flat        produce all of the panels will require
                                               177, subpart B, which implements Title                                                                        ‘‘hundreds of thousands of dollars of labor.’’
                                                                                                       sheet is produced in Italy in dimensions of
                                               III of the Trade Agreements Act of 1979,                two feet in width and variable lengths. These         Aliva indicates that each panel will have a
                                               as amended (19 U.S.C. § 2511–18). In                    aluminum alloy sheets are painted through a           significantly increased value over the
                                               the final determination, CBP was asked                  reverse coil process and will include anti-           collective value of the individual parts
                                               to consider whether the cutting,                        graffiti characteristics as required by the           (casing, core, and mounting blades) after the
                                               bending, and assembly of aluminum                       architectural specification. The sheets are           processing in the United States is completed.



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                                               9016                            Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices

                                               ISSUE:                                                  constitutes a substantial transformation. For         The imported rotors also did not lose their
                                                 Whether the component aluminum parts                  example, in Headquarters Ruling Letter                identity and did not become an integral part
                                               are substantially transformed by the                    (‘‘HRL’’) 055684, dated August 14, 1979, CBP          of a new article when assembled to the U.S.
                                               combining processes in the United States.               held that components of a water cooler gas            bell. Additionally, the use of the calipers and
                                                                                                       absorption refrigeration unit which were              rotors was predetermined at importation.
                                               LAW AND ANALYSIS:                                       formed by cutting to length, cleaning and             Thus, CBP found that the imported rotors
                                                  CBP issues country of origin advisory                bending imported steel tubes into the                 and calipers did not undergo a change in
                                               rulings and final determinations as to                  component shapes and configurations, or by            name, character or use as a result of
                                               whether an article is or would be a product             cutting to length, flattening, and drilling           processing in the United States and remained
                                               of a designated country or instrumentality for          holes into imported tubing, substantially             products of Italy. See also HRL 734873, dated
                                               the purposes of granting waivers of certain             transformed constituent materials for GSP             September 7, 1994 (imported brake rotor
                                               ‘‘Buy American’’ restrictions in U.S. law or            purposes, while those imported tubes which            castings were not substantially transformed
                                               practice for products offered for sale to the           were simply cut to length and assembled into          by processing, which included removing
                                               U.S. Government, pursuant to subpart B of               the final articles were not. See also HRL             0.06–0.12 inches of external surface, drilling
                                               Part 177, 19 C.F.R. § 177.21 et seq., which             555811, dated March 20, 1992 (die cutting,            5–10 holes, counter coring, installing studs or
                                                                                                       stamping and shaping operations                       bolts, and grounding for a fine finish); and
                                               implements Title III of the Trade Agreements
                                                                                                       substantially transform aluminum flat stock           National Hand Tool Corp. v. United States,
                                               Act of 1979, as amended (19 U.S.C. § 2511 et
                                                                                                       into new and different articles of commerce).         16 C.I.T. 308 (1992) (finding no substantial
                                               seq.).
                                                                                                          In HRL 555265, dated July 3, 1989, CBP             transformation occurred because components
                                               Under the rule of origin set forth under 19                                                                   had been cold-formed or hot-forged ‘‘into
                                                                                                       held rolls of imported aluminum strip were
                                               U.S.C. § 2518(4)(B):                                    substantially transformed when the                    their final shape before importation’’, and
                                               An article is a product of a country or                 aluminum strip was crowned, that is, it was           that ‘‘the form of the components remained
                                               instrumentality only if (i) it is wholly the            passed between convexed and concaved egg              the same’’ after the assembly and heat-
                                               growth, product, or manufacture of that                 shape rollers to permanently bow the strip.           treatment processes performed in the United
                                               country or instrumentality, or (ii) in the case         Then the strip was cut to lengths and                 States).
                                               of an article which consists in whole or in             punched with holes. CBP stated that the                  Here, the U.S processing of the panels is
                                               part of materials from another country or               cutting and crowning operations                       minimal and does not alter the character of
                                               instrumentality, it has been substantially              permanently altered the physical                      the casing and core. The pre-importation
                                               transformed into a new and different article            characteristics of the strip thereby limiting its     processing is significantly more complicated
                                               of commerce with a name, character, or use              potential uses. Prior to cutting and crowning,        than the post-importation processing, which
                                               distinct from that of the article or articles           the strip was raw material and possessed              essentially consists of some cutting and
                                               from which it was so transformed.                       nothing in its character indicative of its            assembly of parts. The physical
                                               See also 19 C.F.R. § 177.22(a).                         ultimate use. After the cutting and crowning          characteristics of the casing and the core are
                                                  In rendering final determinations for                operations, the strip could be used in the            already determined by the processing in
                                                                                                       production of a limited range of articles, such       Italy. Most of the cutting and bending of the
                                               purposes of U.S. Government procurement,
                                                                                                                                                             casing and the core occurs prior to
                                               CBP applies the provisions of subpart B of              as venetian blind slats or lattice fences. See
                                                                                                                                                             importation. In Italy, the aluminum sheets
                                               Part 177 consistent with the Federal                    also HRL 557159, dated January 11, 1994
                                                                                                                                                             are produced; the core is created by linking
                                               Procurement Regulations. See 19 C.F.R.                  (extruded aluminum cut to length and bent
                                                                                                                                                             the skins with the aluminum honeycomb; the
                                               § 177.21. In this regard, CBP recognizes that           to shape to form the frame of grilles and
                                                                                                                                                             aluminum for the casing is cut to size; the
                                               the Federal Acquisition Regulations restrict            louvers was substantially transformed).
                                                                                                                                                             casing is painted; three of the four bends in
                                               the U.S. Government’s purchase of products                 The above situations are in contrast to
                                                                                                                                                             the casing are completed; the core is primed
                                               to U.S.-made or designated country end                  those where the imported components
                                                                                                                                                             and painted; and the curved core panels are
                                               products for acquisitions subject to the Trade          constitute the essence of the end product. For
                                                                                                                                                             cut. In contrast, in the United States the last
                                               Agreements Act. See 48 C.F.R. § 25.403(c)(1).           example, in HRL 562653, dated May 14,
                                                                                                                                                             edge of the casing is bent, the straight core
                                               The Federal Acquisition Regulations define              2003, CBP considered whether brake kits that          panels are cut, the core and the casing are
                                               ‘‘U.S.-made end product’’ as ‘‘an article that          were machined and assembled in the United             attached, and the mounting blades are cut
                                               is mined, produced, or manufactured in the              States were substantially transformed.                into shape and attached; thus, the form of the
                                               United States or that is substantially                  Unplated, drilled and slotted brake rotors            components remains essentially the same
                                               transformed in the United States into a new             and calipers from Italy were plated with a            after U.S. processing. Since the form,
                                               and different article of commerce with name,            protective zinc coating and some of the               materials, and structure remain the same, we
                                               character, or use distinct from that of the             calipers were painted/labeled. After painting,        find there is no change in character of the
                                               article or articles from which it was                   the calipers were machined to specification,          core and casing.
                                               transformed.’’ See 48 C.F.R § 25.003.                   in accordance with the mounting profile                  The processing here is similar to the brake
                                                  In determining whether the combining of              determined by engineers. The two imported             kits in HRL 562653. The major parts are
                                               parts constitutes a substantial transformation,         plated rotors were each mounted to a U.S.-            imported in essentially the same shape that
                                               the determinative issue for CBP is the extent           origin bell by means of ten small bushing             they will be in when assembled into the final
                                               of operations performed and whether the                 assemblies, each of which was comprised of            product. Although there is some cutting,
                                               parts lose their identity and become an                 a bushing, spacer, spring washer and bolt.            drilling, and slotting, the casing and the core
                                               integral part of the new article. Belcrest              The bushing and the spring were imported              do not lose their identity or become an
                                               Linens v. United States, 6 C.I.T. 204 (1983),           from Italy, while the remaining articles were         integral part of a new article when assembled
                                               aff’d, 741 F.2d 1368 (Fed. Cir. 1984).                  of U.S.-origin. CBP found that, at                    in the United States. Like the brake kits, at
                                               Assembly operations that are minimal or                 importation, both the rotors and the calipers         importation the casing and core are not
                                               simple, as opposed to complex or                        were not rough, generic forms with a                  rough, generic forms with a multitude of
                                               meaningful, will generally not result in a              multitude of uses, but were essentially               uses—they are imported only to be
                                               substantial transformation. See HQ H125975,             complete articles which already bore the              assembled to be sold as wall panels.
                                               dated January 19, 2011. CBP considers the               name of the finished product; therefore, the          Therefore, the casing and core are not new
                                               totality of the circumstances and makes such            use of the articles was determined at the time        and different articles of commerce from the
                                               determinations on a case-by-case basis.                 of importation. While the calipers underwent          assembled panels.
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                                                  In determining whether a substantial                 some machining operations in the United                  Here, because the core and the casing are
                                               transformation has occurred in the                      States, the overall shape and form of the             not substantially transformed in the United
                                               processing of metals, CBP has generally held            finished articles was essentially the same as         States, the country of origin of the completed
                                               that cutting or bending materials to defined            the imported articles. Likewise, although all         panels is Italy.
                                               shapes or patterns suitable for use in making           of the rotors were plated in the United States,
                                               finished articles, as opposed to mere cutting           and some underwent additional drilling and/           HOLDING:
                                               to length or width which does not render the            or slotting in the United States, the overall           Based on the facts of this case, aluminum
                                               article suitable for a particular use,                  dimensions and diameter remained the same.            honeycomb panels are not substantially



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                                                                               Federal Register / Vol. 83, No. 42 / Friday, March 2, 2018 / Notices                                                  9017

                                               transformed through the assembly of the                 tablet computers, smart phones, and                   System’’), pursuant to subpart B of Part 177,
                                               parts in the United States. The country of              systems, which may be offered to the                  U.S. Customs and Border Protection (CBP)
                                               origin of the aluminum honeycomb panels is              United States Government under an                     Regulations (19 C.F.R. § 177.21, et seq.). You
                                               Italy.                                                                                                        state in your letter that this request is being
                                                                                                       undesignated government procurement
                                                  Notice of this final determination will be                                                                 made pursuant to a contract with the
                                               given in the Federal Register, as required by           contract. These final determinations,                 Department of Veterans Affairs (VA) with
                                               19 C.F.R. § 177.29. Any party-at-interest other         HQ H284834 and HQ H284617, were                       1Vision requiring the filing of a request for
                                               than the party which requested this final               issued at the request of 1Vision, LLC                 a country of origin determination from CBP.
                                               determination may request, pursuant to 19               and Care Innovations, LLC, respectively,                 As a domestic producer, 1Vision is a party-
                                               C.F.R. § 177.31, that CBP reexamine the                 under procedures set forth at 19 CFR                  at-interest within the meaning of 19 C.F.R.
                                               matter anew and issue a new final                       part 177, subpart B, which implements                 § 177.22(d)(1) and is entitled to request this
                                               determination. Pursuant to 19 C.F.R.                    Title III of the Trade Agreements Act of              final determination.
                                               § 177.30, any party-at-interest may, within 30          1979, as amended (19 U.S.C. 2511–18).
                                               days of publication of the Federal Register                                                                   FACTS:
                                               Notice referenced above, seek judicial review
                                                                                                       In the final determinations, CBP was                     The products at issue are the Tele-health
                                               of this final determination before the Court            asked to consider whether disabling the               System in its entirety and the components,
                                               of International Trade.                                 general applications of a tablet                      the CareConsole Hub and the Mobile Hub.
                                               Sincerely,                                              computer or smart phone and loading                   The CareConsole Hub and the Mobile Hub,
                                               Alice A. Kipel, Executive Director                      specialized software onto the device,                 respectively, begin as a tablet computer and
                                               Regulations and Rulings                                 enabling a patient to provide medical                 a smart phone. The CareConsole Hub is
                                               Office of International Trade                           information to the VA, constituted a                  produced in the Republic of Korea and the
                                               [FR Doc. 2018–04279 Filed 3–1–18; 8:45 am]              substantial transformation. In one final              Mobile Hub is produced in China. Both
                                                                                                       determination, CBP was further asked if               products are intended for purchase by the
                                               BILLING CODE P
                                                                                                                                                             Veterans Health Administration for use by
                                                                                                       the integration of the altered tablets and
                                                                                                                                                             patients at home. The CareConsole Hub and
                                                                                                       smartphones into a larger telehealth                  the Mobile Hub are designed to collect health
                                               DEPARTMENT OF HOMELAND                                  system constituted a substantial                      data that is measured by other peripheral
                                               SECURITY                                                transformation. In the final                          devices, such as blood pressure cuffs, blood
                                                                                                       determinations, CBP concluded that                    glucose monitors, etc. These other peripheral
                                               U.S. Customs and Border Protection                      these activities do not constitute a                  devices are not imported with the tablet and
                                                                                                       substantial transformation and the                    could be used ‘‘as is’’ within the 1Vision
                                               Notice of Issuance of Final                             origin of the tablet computers, smart                 ecosystem, without any changes.
                                               Determinations Concerning Country of                    phones, and systems remains the                          In the United States, the tablet and smart
                                               Origin of the Hub and Mobile                            original country of manufacturing.                    phone go through a number of software
                                               Platforms, and the AMC Home Tele-                                                                             uninstallations and installations. The generic
                                                                                                          Section 177.29, CBP Regulations (19
                                               Health System                                                                                                 Android functions originally included on the
                                                                                                       CFR 177.29), provides that notice of                  devices, such as alarms, calculators and text
                                               AGENCY:  U.S. Customs and Border                        final determinations shall be published               messaging, are removed. In order to enable
                                               Protection, Department of Homeland                      in the Federal Register within 60 days                the devices to function within the Tele-
                                               Security.                                               of the date the final determination is                health System, other functions, such as
                                               ACTION: Notice of final determinations.                 issued. Section 177.30, CBP Regulations               Bluetooth capability, are modified and
                                                                                                       (19 CFR 177.30), provides that any                    additional software is added. In addition,
                                               SUMMARY:   This document provides                       party-at-interest, as defined in 19 CFR               1Vision also further processes the devices to
                                               notice that U.S. Customs and Border                     177.22(d), may seek judicial review of a              include additional security mechanisms and
                                               Protection (‘‘CBP’’) has issued two final                                                                     to enable them to function in Plain Old
                                                                                                       final determination within 30 days of
                                                                                                                                                             Telephone Systems (‘‘POTS’’), an analog
                                               determinations concerning the country                   publication of such determination in the              telephone service that continues to be the
                                               of origin of tablet computers and smart                 Federal Register.                                     basic form of home and small business
                                               phones known as the Hub and Mobile                        Dated: February 21, 2018.                           service connection to telephone networks.
                                               Platforms, and CareConsole Hub and                      Alice A. Kipel,                                          Finally, the AMC CareConsole Mobile
                                               Mobile Hub. CBP has concluded in the                                                                          Application is installed on both devices.
                                                                                                       Executive Director, Regulations and Rulings,
                                               final determinations that for purposes of               Office of Trade.
                                                                                                                                                             According to the information provided, this
                                               U.S. Government procurement the                                                                               software was developed entirely in the
                                               installation of proprietary software on                 HQ H284834                                            United States. The software enables the
                                               tablet computers or smart phones does                                                                         patient to provide vital sign data by
                                                                                                       February 21, 2018                                     connecting to the peripheral devices via
                                               not substantially transform the imported
                                                                                                       OT:RR:CTF:VS: H284834 JMV                             Bluetooth. The patient’s information is then
                                               tablet computers or smart phones.                                                                             forwarded to VA clinicians over the VA
                                               DATES: The final determinations were                    CATEGORY: Origin                                      intranet. This application is installed on the
                                               issued on February 21, 2018. Copies of                  George W. Thompson, Esq.                              tablet to meet the VA’s requirements for
                                               the final determinations are attached.                  Thompson & Associates, PLLC                           medical devices, including patient
                                               Any party-at-interest, as defined in 19                 1250 Connecticut Ave. NW, Suite 200                   confidentiality and interoperability with VA
                                               CFR 177.22(d), may seek judicial review                 Washington, DC, 20036                                 systems and protocols. After the software
                                               of these final determinations within                                                                          installation is completed, the tablets cannot
                                                                                                       RE: U.S. Government Procurement; Title III,
                                                                                                                                                             run any other program and cannot be
                                               April 2, 2018.                                          Trade Agreements Act of 1979 (19 U.S.C.
                                                                                                                                                             reprogrammed to perform any other function.
                                               FOR FURTHER INFORMATION CONTACT: Joy                    § 2511); Subpart B, Part 177, CBP
                                                                                                                                                                The CareConsole Hub and Mobile Hub are
                                               Marie Virga, Valuation and Special                      Regulations; Tablet Computers, CareConsole
                                                                                                                                                             then integrated into the Tele-health System,
                                                                                                       Hub and Mobile Hub
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                                               Programs Branch, Regulations and                                                                              which also includes servers, data storage,
                                               Rulings, Office of Trade (202–325–                      Dear Mr. Thompson:                                    networking, additional software, and health
                                               1511).                                                     This is in response to your letter of March        monitoring devices such as blood pressure
                                                                                                       20, 2017, on behalf of 1Vision, LLC                   cuffs and glucose monitors. The integration
                                               SUPPLEMENTARY INFORMATION: Notice is                    (‘‘1Vision’’), requesting a final determination       process consists of the CareConsole Hub or
                                               hereby given that on February 21, 2018,                 concerning the country origin of a product            Mobile Hub contacting the Tele-health
                                               CBP issued two final determinations                     that you refer to as the AMC Home Tele-               System, hosted in the VA data centers, which
                                               concerning the country of origin of                     health System (‘‘Tele-health System’’ or ‘‘the        then sends an activation code and



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Document Created: 2018-03-01 23:56:38
Document Modified: 2018-03-01 23:56:38
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionNotices
ActionNotice of final determination.
DatesThe final determination was issued on February 21, 2018. A copy of the final determination is attached. Any party-at-interest, as defined in 19 C.F.R. Sec. 177.22(d), may seek judicial review of this final determination within April 2, 2018.
ContactJoy Marie Virga, Valuation and Special Programs Branch, Regulations and Rulings, Office of Trade (202-325- 1511).
FR Citation83 FR 9015 

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