Skill and Precision of Operations Cited in Origin Ruling on Videoscopes
U.S. Customs and Border Protection has issued a final determination concerning the country of origin of videoscopes (remote visual inspection equipment) that may be offered to the U.S. government under undesignated government procurement contracts. Any party-at-interest may seek judicial review of this determination by Feb. 21. 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 videoscopes are comprised of a computer control unit, a scope unit with a light source, and a tip adapter. The CCU’s main components are manufactured in Thailand but its software is wholly designed in Japan, which is also where final assembly and packaging take place. The handset of the scope unit is assembled in Thailand and is then connected to another component (created and assembled in Japan) in Japan to create the scope unit subassembly. The CCU and scope are connected to make a functional videoscope in Japan. The tip adapter is wholly designed, manufactured, and assembled in Japan.
In ruling HQ H303139, CBP concludes that Japan is the country of origin of the videoscopes for purposes of U.S. government procurement because that is where they are substantially transformed. CBP explains that while many important components are of Thai origin and many processing operations occur in Thailand, the Japanese operations require more skill and precision and impart the final product with its essential character. CBP adds that the scope imparts the videoscope with its identifying functionality and that this function is further enhanced by the Japanese-originating tip adapter. Additionally, it is the software that allows the user to control the scope and view the image it captures.