CBP Rules France Is Country of Origin for Corning's Fiber Optic Cables
The country of origin for Corning Optical Communications’ fiber optic cables is France, and as such, the cables aren't subject to Section 301 measures even though part of the manufacturing process occurred in China, a CBP ruling released earlier this month said.
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Corning requested the ruling, HQ H337046, in April 2023 and asked for a refund of the Section 301 duties it had paid.
The company argued that its broker had inadvertently declared the fiber optic cables as being of Chinese origin instead of listing France as the country of origin. If declared as being of French origin, the goods would not have been subject to Section 301 duties, Corning said. Although some manufacturing processes occurred in China, the fiber optic cables weren't substantially transformed by the processes, Corning continued.
Corning imports and sells the fiber optic cables for use in internal optical fiber communications systems. The cables are made up of 12 optical fibers inside an insulating jacket and manufactured in varying lengths to fit the end user's need.
Corning said the fiber is prepared, colored and prepared for jacketing in China, while in France, the cables are manufactured in such a way as to develop the fiber’s attenuation properties. Corning also said the fiber is fully functional and usable as optical fiber when it's exported from France.
Previous CBP rulings informed CBP's ultimate decision. These rulings determined that the country of origin of fiber optic cables is the origin of the optical fiber preform and that the fiber optic cables’ characteristics were primarily imparted at the time the fiber optic cable was manufactured.
Considering these precedents, CBP agreed with Corning’s argument that the fiber optic cables should have France as the country of origin.
“In the instant case, it is our opinion that bundling, jacketing, coloring, rolling, and assembly of the cable to Chinese-origin connectors in China does not result in a substantial transformation of the cable,” CBP said in its decision, dated Sept. 27 but released in December. “The assembly operations in China are not complex enough so as to transform the merchandise into a new article. Notably, bundling 12 individual fibers together does not significantly affect the capability of the finished cable as the merchandise is usable as optical fiber when it is exported from France to China.”
As a result, “We find that the French origin optical fiber exported to China and processed in China ... is not substantially transformed into a new and different article of commerce with a name, character, and use distinct from the article exported. Thus, the country of origin of the subject merchandise is France and is not subject to Section 301 measures,” CBP said.
In addition to asking CBP to determine fiber optic cables’ country of origin, Corning Optical asked the agency to reconsider its initial determination that the fiber optic cables were classified under subheading 9001.10.00, which provides for “Optical fibers and optical fiber bundles; optical fiber cables other than those of heading 8544; sheets and plates of polarizing material; lenses (including contact lenses), prisms, mirrors and other optical elements, of any material, unmounted, other than such elements of glass not optically worked.”
CBP agreed with Corning’s assessment and determined that the fiber optic cables should be classified instead under subheading 8544.70.00, which provides for: “Insulated (including enameled or anodized) wire, cable (including coaxial cable) and other insulated electric conductors, whether or not fitted with connectors; optical fiber cables, made up of individually sheathed fibers, whether or not assembled with electric conductors or fitted with connectors: Winding wire: Optical fiber cables.”
CBP made this decision because it determined that the optical fibers were “individually sheathed,” which means the fiber optic cables would fall under subheading 8544.70.00.
“Based upon the information and photographs provided, the fibers are considered complete cables of heading 8544. Here, the fibers are jacketed with resin in China prior to being rolled together to complete the cable and in turn, ‘sheathed,’” CBP said. As a result, the fiber optic cables should be classified under subheading 8544.70.00.