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CBP Affirms that Refining of Imported Chemical is Not Substantial Transformation

Thursday, September 24, 2015
Sandler, Travis & Rosenberg Trade Report

CBP has issued a final determination concerning the country of origin of certain analytical-grade acetonitrile that may be offered to the U.S. government under an undesignated government procurement contract. This determination was issued Sept. 18 and any party-at-interest may seek judicial review of it by Oct. 26. 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.

The product at issue is a purified chemical that the petitioner plans to manufacture in the U.S. from crude, commercial-grade acetonitrile imported from China and other countries. It is suitable for use in instruments used for analyzing chemicals for pharmaceutical drug development and production, food safety, medical clinical testing and environmental testing.

The petitioner argued that the process of purifying the imported commercial-grade acetonitrile substantially transforms this product because it is lengthy and requires sophisticated, expensive equipment and highly educated personnel. However, CBP states that it is a “well-settled principle” of customs law that just purifying or refining a chemical does not result in a substantial transformation into a new and different article of commerce with a new name, character or use.

In this case CBP finds that the finished product will not have a different name or character and that while it will have a different use this change is only from one type of industrial use to another. CBP therefore concludes that the country of origin of the finished analytical-grade acetonitrile will not be the U.S. for U.S. government procurement purposes.

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