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U.S. Processing Not Sufficient to Confer Origin for Aluminum Panels, CBP Rules

Friday, March 02, 2018
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection has issued a final determination concerning the country of origin of aluminum honeycomb panels that may be offered to the U.S. government under an undesignated government procurement contract. Any party-at-interest may seek judicial review of these determinations by April 2. 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 products at issue are used as architectural finished coating panels for wall and tunnel areas in train stations. They are either straight or curved and each contains a casing, a core, and two mounting blades. The casing and core are both produced in Italy and then transported to the U.S. to be assembled. The mounting blades are aluminum alloy sheets of unknown origin that are extruded, machined, bent, and cut to size in the U.S. before being secured to the core. The petitioner asserts that the processing in the U.S. requires skilled labor and increases the value of the component parts.

In ruling HQ H290528 CBP concludes that the U.S processing of the panels is minimal and does not alter the character of the casing and core. Most of the cutting and bending of these components takes place during pre-importation processing in Italy; as a result, the major parts are imported in essentially the same shape they will be in when assembled into the final product. Although the post-importation processing in the U.S. includes some cutting, drilling, and slotting, CBP finds that these activities do not cause the casings and cores to lose their identity or become an integral part of a new articles. CBP adds that these components are imported only to be assembled to be sold as wall panels, meaning they are not new and different articles of commerce from the assembled panels. As a result, CBP concludes that the country of origin of the completed panels is Italy.

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