[Federal Register Volume 90, Number 118 (Monday, June 23, 2025)]
[Notices]
[Pages 26598-26601]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-11466]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
Notice of Issuance of Final Determination Concerning Trimble R980
GNSS Receiver
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security.
ACTION: Notice of final determination.
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SUMMARY: This document provides notice that U.S. Customs and Border
Protection (CBP) has issued a final determination concerning the
country of origin of the Trimble R980 Global Navigation Satellite
System (GNSS) Receiver. Based upon the facts presented, CBP has
concluded that the last substantial transformation of the R980 GNSS
Receiver occurs in the United States.
DATES: The final determination was issued on June 18, 2025. A copy of
the final determination is attached. Any party-at-interest, as defined
in 19 CFR 177.22(d), may seek judicial review of this final
determination no later than July 23, 2025.
FOR FURTHER INFORMATION CONTACT: Anna Hedstrom, Valuation and Special
Programs Branch, Regulations and Rulings, Office of Trade, at (202)
325-0227.
SUPPLEMENTARY INFORMATION: Notice is hereby given that on June 18,
2025, CBP issued a final determination concerning the country of origin
of the Trimble R980 GNSS Receiver for purposes of Title III of the
Trade Agreements Act of 1979. This final determination, Headquarters
Ruling Letter (HQ) H345749, was issued at the request of Trimble, Inc.
under procedures set forth at 19 CFR part 177, subpart B, which
implements Title III of the Trade Agreements Act of 1979, as amended
(19 U.S.C. 2511-18). In the final determination, CBP has concluded that
the last substantial transformation of the R980 GNSS Receiver occurs in
the United States. The final determination also finds that the R980
GNSS Receiver is exempt from the country of origin marking requirements
of 19 U.S.C. 1304.
Section 177.29, CBP Regulations (19 CFR 177.29), provides that a
notice of final determination shall be published in the Federal
Register within 60 days of the date the final determination is issued.
Section 177.30, CBP Regulations (19 CFR 177.30), provides that any
party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial
review of a final determination within 30 days of publication of such
determination in the Federal Register.
Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.
[GRAPHIC] [TIFF OMITTED] TN23JN25.011
HQ H345749
June 18, 2025
OT:RR:CTF:VS H345749 ACH
[[Page 26599]]
CATEGORY: Origin
John McKenzie, Baker & McKenzie LLP, Two Embarcadero Center, 11th
Floor, San Francisco, CA 94111-3802
RE: U.S. Government Procurement; Title III, Trade Agreements Act of
1979 (19 U.S.C. 2511); Subpart B, Part 177, CBP Regulations; Country
of Origin of R980 Global Navigation Satellite System Receiver;
Country of Origin Marking
Dear Mr. McKenzie,
This is in response to your February 3, 2025 request, on behalf
of Trimble, Inc. (``Trimble''), for a final determination concerning
the country of origin of the R980 Global Navigation Satellite System
(``GNSS'') Receiver, pursuant to Title III of the Trade Agreements
Act of 1979 (``TAA''), as amended (19 U.S.C. 2511 et seq.), and
subpart B of Part 177, U.S. Customs and Border Protection (``CBP'')
Regulations (19 CFR 177.21, et seq.). Trimble is a party-at-interest
within the meaning of 19 CFR 177.22(d)(1) and 177.23(a) and is
therefore entitled to request this final determination. You also
requested a determination on whether the product is exempt from
country of origin marking requirements.
FACTS
Trimble is a Delaware corporation based in Colorado,
specializing in the production and design of industrial technology
for the agricultural, construction, and geospatial transportation
industries. At issue in this case is the R980 GNSS Receiver, which
you describe as designed for ``surveying and mapping in challenging
environments.''
The R980 GNSS Receiver consists of seven main components, which
undergo final assembly into a chassis in Thailand:
1. Main Board Assembly,
2. Power Supply and Communications Board Assembly,
3. Antenna Element Assembly,
4. Radio Interface,
5. Antenna Low Noise Amplifier,
6. Battery subscriber identity model (``SIM''), and
7. 450MHz Radio.
Four of these components, the main board assembly, the power
supply and communications board assembly, the antenna element
assembly, and the radio interface are stated to be manufactured in
the United States. You characterize three of these U.S.-origin
components as printed circuit board assemblies (``PCBAs''). You
state that the main board assembly is the primary PCBA, which
provides the ``essential character'' of the R980 GNSS Receiver,
including the central processing unit (``CPU''), random access
memory (``RAM''), flash memory module, RF processor, baseband
processer, and Global Positioning System (``GPS'') Components. These
components are assembled onto the board using Surface Mount
Technology (``SMT'') in the United States. You additionally state
that the Radio Interface is a separate PCBA with 59 components
assembled onto a bare circuit board with SMT. You also state that
the power supply and communications board assembly is a PCBA with
593 components assembled onto a circuit board using SMT and includes
all communication functions of the R980 GNSS Receiver.
Two of the main components, the antenna low noise amplifier and
battery SIM, are produced in Thailand. You state that these
``perform subsidiary roles with respect to the R980 GNSS device.''
The low noise amplifier is assembled in Thailand and then shipped to
the United States and built into the Antenna Element Assembly.
Additionally, the battery SIM is a PCBA produced by assembling five
components onto a bare printed circuit board.
The final main component is a 450MHz Radio, which is produced in
Finland. You provide no details about the production process of this
component, but it has a higher cost than the materials from any
other country. This radio is only available for R980 GNSS Receivers
sold in the United States, Canada, Australia, and New Zealand.
The final assembly operations occur in Thailand, involving the
following steps:
1. The main board assembly, radio interface PCBA, power supply
and communications PCBA, antenna assembly, and radio module are
screwed onto a ``hot box'' with screws and then the ``hot box''
assembly is subject to functional testing.
2. A keypad is installed onto the chassis with glue and two
screws.
3. The battery compartment floor, battery compartment, and
battery SIM are assembled and affixed to the chassis with screws.
4. The ``hot box'' subassembly with the PCBAs and antenna
element are affixed to the chassis.
5. The battery compartment door is installed to the outside of
the chassis with two screws.
6. Various mechanical parts are installed into the chassis.
7. Four compliance labels, overlays and serial number labels are
attached to the exterior of the chassis.
8. A series of functional tests are conducted (leak test;
calibration confirmation; unit input/output testing; unit gyroscope
testing).
You claim that the R980 GNSS Receiver would not be functional
without Trimble's proprietary software. You estimate that software
development ``involved more than 1 million developer hours,'' and
that 67 percent of the code was written by developers in the United
States and 33 percent by developers in Germany. You state that this
proprietary software has further undergone ``software build'' in the
United States, where it was compiled from its constituent source
code into machine readable binaries. This software will be flashed
onto a memory component in the United States, which will then be
assembled onto the main board PCBA by SMT in the United States. In
total, you estimate that 70 percent of the R980 GNSS Receiver's
value is the result of this proprietary software.
Issue
What is the country of origin of the R980 GNSS Receiver for the
purposes of U.S. Government procurement and country of origin
marking?
Law and Analysis
Country of Origin Determination
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 purpose 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 CFR 177.21-177.31, which
implements Title III of the TAA, as amended (19 U.S.C. 2511-2518).
CBP's authority to issue advisory rulings and final
determinations stems from 19 U.S.C. 2515(b)(1), which states:
For the purposes of this subchapter, the Secretary of the
Treasury shall provide for the prompt issuance of advisory rulings
and final determinations on whether, under section 2518(4)(B) of
this title, an article is or would be a product of a foreign country
or instrumentality designated pursuant to section 2511(b) of this
title.
Emphasis added.
The Secretary of the Treasury's authority mentioned above, along
with other customs revenue functions, are delegated to the Secretary
of Homeland Security via Treasury Department Order (TO) 100-20
``Delegation of Customs revenue functions to Homeland Security,''
dated October 30, 2024, and are subject to further delegations to
CBP (see also 19 CFR part 177, subpart B).
The rule of origin set forth under 19 U.S.C. 2518(4)(B) states:
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 CFR 177.22(a).
In rendering advisory rulings and final determinations for
purposes of U.S. Government procurement, CBP applies the provisions
of subpart B of Part 177 consistent with the Federal Procurement
Regulation (``FAR''). See 19 CFR 177.21. In this regard, CBP
recognizes that the FAR restricts the U.S. Government's purchase of
products to U.S.-made or designated country end products for
acquisitions subject to the TAA. See 48 CFR 25.403(c)(1).
The FAR, 48 CFR 25.003, defines ``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 a name,
character, or use distinct from that of the article or articles from
which it was transformed.
Additionally, the FAR, 48 CFR 25.003 defines ``designated
country end product'' as:
a WTO GPA [World Trade Organization Government Procurement
Agreement] country end product, an FTA [Free Trade Agreement]
country end product, a least developed country end product, or a
Caribbean Basin country end product.
[[Page 26600]]
Section 25.003 defines ``WTO GPA country end product'' as an article
that:
(1) Is wholly the growth, product, or manufacture of a WTO GPA
country; or
(2) In the case of an article that consists in whole or in part of
materials from another country, has been substantially transformed
in a WTO GPA country 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 transformed. The term refers to a product
offered for purchase under a supply contract, but for purposes of
calculating the value of the end product includes services (except
transportation services) incidental to the article, provided that
the value of those incidental services does not exceed that of the
article itself.
Thailand is not a ``designated country,'' and products of
Thailand are not eligible for U.S. Government procurement. 48 CFR
25.003
To determine whether a substantial transformation occurs when
components of various origins are assembled into completed products,
CBP considers the totality of the circumstances and makes such
determinations on a case-by-case basis. The country of origin of the
item's components, extent of the processing that occurs within a
country, and whether such processing renders a product with a new
name, character, and use are primary considerations in such cases.
Additionally, factors such as the resources expended on product
design and development, the extent and nature of post-assembly
inspection and testing procedures, and worker skill required during
the actual manufacturing process will be considered when determining
whether a substantial transformation has occurred. No one factor is
determinative. See, e.g., Headquarters Ruling Letter (``HQ'')
H311606, dated June 16, 2021; and HQ H302801, dated October 3, 2019.
You argue that, because the key components of the R980 GNSS
Receiver are manufactured in the United States, it is a product of
the United States. You further argue that the final production in
Thailand is a ``simple assembly'' and does not result in a
substantial transformation. You also argue that the main PCBA, once
fully assembled and programmed, contains the ``essential character''
of the R980 GNSS Receiver. In support of this, you cite the U.S.
Court of International Trade's opinion in Energizer Battery, Inc. v.
United States, 190 F. Supp. 3d 1308 (Ct. Int'l Trade 2016).
Energizer Battery involved the manufacture of a flashlight in which
all the components of the flashlight were of Chinese origin, except
for a white LED and a hydrogen getter. The components were imported
into the United States and assembled into the finished Generation II
flashlight. The Energizer Battery court applied the ``name,
character and use'' test to determine whether a substantial
transformation had occurred and noted, citing Uniroyal, Inc. v.
United States, 542 F. Supp. 1026, 1031 (Ct. Int'l Trade 1982), that
when ``the post-importation processing consists of assembly, courts
have been reluctant to find a change in character, particularly when
the imported articles do not undergo a physical change.'' Energizer
Battery at 1318. In addition, the court noted that ``when the end-
use was pre-determined at the time of importation, courts have
generally not found a change in use.'' Energizer Battery at 1319,
citing as an example, National Hand Tool Corp. v. United States, 16
C.I.T. 308, 312 (1992), aff'd, 989 F.2d 1201 (Fed. Cir. 1993).
Further, courts have considered the nature of the assembly, i.e.,
whether it is a simple or complex assembly, such that individual
parts lose their separate identities and become integral parts of a
new article. Energizer Battery, 190 F. Supp. 3d 1308.
Regarding electronic equipment, CBP has found that circuit
boards undergo a substantial transformation into PCBAs when various
components are assembled onto the board via SMT. See C.S.D. 85-25,
19 Cust. Bull. 844 (1985) (determining that the assembly of the PCBA
involved a very large number of components and a significant number
of different operations, required a relatively significant period of
time as well as skill, attention to detail, and quality control, and
resulted in significant economic benefit to the beneficiary
developing country from the standpoint of both value added to the
PCBA and the overall employment generated thereby). Additionally,
CBP has found that the mere attachment of wires to a PCBA and
installation into a case, along with minor tuning processes, does
not result in a substantial transformation. HQ 561232, dated April
20, 2004.
As you further highlight, the programming of a device may also
affect its country of origin. In Data General v. United States, 4
C.I.T. 182 (1982), the court determined that the programming of a
foreign PROM (``Programmable Read-Only Memory'' chip) in the United
States substantially transformed the PROM into a U.S. article. In
the United States, the programming bestowed upon each integrated
circuit its electronic function, that is, its ``memory'' which could
be retrieved. A distinct physical change was effected in the PROM by
the opening or closing of the fuses, depending on the method of
programming. The essence of the article, its interconnections or
stored memory, was established by programming. Texas Instruments v.
United States, 681 F.2d 778, 782 (CCPA 1982) (stating the
substantial transformation issue is a ``mixed question of technology
and customs law'').
CBP has issued multiple decisions involving articles containing
several PCBAs and their functionality in the final article. For
instance, in HQ H301910, dated August 5, 2019, which concerned
mailing machine engines, CBP determined that the main PCBA, the
print control firmware, and the print head constituted the primary
and fundamental essence of the mailing machine engine because these
components controlled the engine's function, operations, and enabled
the printing of the correct postage. In particular, the main PCBA
was composed of components essential to the fundamental function and
primary purpose of the engine, including the CPU, the memory, and
the Field-Programmable Gate Array, which combined to form the
``brain'' of the device. CBP held that, inasmuch as the main PCBA,
the print control firmware, and the print head were all produced in
Japan, the country of origin of the mailing engine machine was
Japan.
In HQ H302801, dated October 3, 2019, CBP considered the country
of origin of certain ``Fitbit'' smart watches. The case involved
multiple PCBAs from Taiwan or the Philippines, which were assembled
together into a final product in China by installing PCBAs into a
housing with a vibration motor, battery, display, and wristband. The
assembly did not alter the PCBAs' functional or physical attributes,
and the PCBAs had a predetermined end-use as the electronic
``brain'' of the device. Additionally, the final assembly in China
was neither complex nor time intensive, whereas the assembly of the
PCBAs required complex equipment for SMT, a high level of expertise,
and involved more components and subassemblies than the final
assembly in China. Therefore, the country of origin was Taiwan or
the Philippines.
However, in HQ H304677, dated April 21, 2023, CBP found that the
country of origin of laser printers was China, even though the main
PCBAs were manufactured and installed into the final product in
Mexico. In that case, the printer transports which included all the
mechanical components of the device, such as the housing, scanner,
power supply, and fuser, were manufactured in China. The PCBAs were
manufactured in Mexico, where components were added to the board
with SMT, and U.S. and Philippine-origin firmware was downloaded
onto the PCBA. The PCBAs were then installed into the printers and
the devices underwent a series of tests. CBP determined that the
PCBAs were not the only fundamental functioning component of the
printer, since the Chinese printer transports also provided
character to the final article. Furthermore, since all of the
mechanical printing functions were imparted by the Chinese
transports, the country of origin was China.
Most significantly, CBP analyzed another, almost identical GNSS
Receiver produced by Trimble in HQ H338116, dated June 4, 2024. In
this final determination, CBP determined that the country of origin
was the United States even though two PCBAs were manufactured in
Thailand and a 450 MHz radio component was manufactured in China.
Because the U.S.-origin components were notably more complex, CBP
determined that the country of origin of these receivers was the
United States.
In the instant case, based on the totality of the circumstances
and consistent with the pertinent authorities, we find that the
country of origin of the R980 GNSS Receiver is the United States. We
agree that the U.S.-origin main board assembly imparts the
``essential character'' of the R980 GNSS Receiver. In addition,
three other PCBAs are also manufactured in the United States. As in
HQ H302801, the main PCBAs originate in one country, in this matter
the United States, where most of the required production took place.
The production process here includes assembling hundreds of
electronic components onto the PCBA using SMT, including the CPU,
RAM, GPS components,
[[Page 26601]]
and communications components, which are central to the device's
operation.
Furthermore, U.S. production involves programming and
configuring the primary PCBA with Trimble's proprietary U.S.-origin
software, which is required for the device to function and defines
its use. This case is unlike HQ H304677, which involved U.S.-origin
software programmed onto a Mexican-origin PCBA, because here both
the software and the primary PCBA originate from the same country.
Additionally, in H304677, all other fundamental functional
components of the printer were produced in China, whereas in this
instance, most of the primary components of the R980 GNSS Receiver
are assembled in the United States. Furthermore, once they are fully
assembled, all U.S.-origin components will have a predetermined end-
use in the R980 GNSS Receiver when exported to Thailand and
installed into the device.
We also find that the 450MHz Radio manufactured in Finland does
not affect the country of origin determination. The receiver
analyzed in HQ H338116 also included a 450MHz Radio, manufactured in
China, and CBP determined that the radio component was not
significant enough to the receiver's name, character, or use to
affect the country of origin determination, and we note that it is
only available when sold to certain countries.
We agree that the assembly in Thailand is a simple assembly that
does not result in a substantial transformation. It primarily
involves placing the PCBAs into a ``hot box'' subassembly and then
affixing the ``hot box,'' antenna, battery, and keypad to the
chassis, in contrast to the complex SMT performed in the United
States. While the two Thai-origin main components are also PCBAs and
are produced using SMT, they play a subsidiary role within the
device. They do not undergo any programming or process any
communications or navigational information which are required for
the R980 GNSS Receiver to function. The U.S.-origin components are
notably more complex, which is why more worker hours are required to
produce the U.S.-origin components. Therefore, based on the totality
of the circumstances, we determine that the final assembly in
Thailand does not result in a substantial transformation.
Accordingly, we find that the last substantial transformation
occurs in the United States, and therefore, the finished R980 GNSS
Receiver is not a product of a foreign country or instrumentality
designated pursuant to 19 U.S.C. 2511(b). As to whether the R980
GNSS Receiver produced in the United States qualifies as a ``U.S.-
made end product,'' you may wish to consult with the relevant
government procuring agency and review Acetris Health, LLC v. United
States, 949 F.3d 719 (Fed. Cir. 2020).
Country of Origin Marking
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C.
1304), provides that unless excepted, every article of foreign
origin imported into the United States shall be marked in a
conspicuous place as legibly, indelibly, and permanently as the
nature of the article (or its container) will permit, in such a
manner as to indicate to an ultimate purchaser in the United States
the English name of the country of origin of the article.
For purposes of the marking requirement, the term ``country of
origin'' is defined under 19 CFR 134.1(b), which adopts the same
``substantial transformation'' rule as the TAA and the FAR. See 19
U.S.C. 2518(4)(B); FAR, 48 CFR 25.003. Specifically, Section
134.1(b) of the CBP Regulations (19 CFR 134.1(b)), states that:
``Country of origin'' means the country of manufacture,
production, or growth of any article of foreign origin entering the
United States. Further work or material added to an article in
another country must effect a substantial transformation in order to
render such other country the ``country of origin'' within the
meaning of this part;
Section 134.32 of the CBP Regulations (19 CFR 134.32) provides
several exceptions to the marking requirement. Specifically,
``products of the United States exported and returned'' are exempt
from the country of origin marking requirement. 19 CFR 134.32(m).
As discussed above, for purposes of section 2518(4)(B) of the
TAA, the R980 GNSS Receiver is a product of the United States.
Having already reached this determination, we also find that the
R980 GNSS Receiver is a product of the United States for the purpose
of country of origin marking, and therefore, the R980 GNSS Receiver
may be excepted from country of origin marking when imported into
the United States, pursuant to 19 CFR 134.32(m).
Holding
Based on the information provided, for purposes of U.S.
Government procurement and country of origin marking upon
importation, the R980 GNSS Receiver is a product of the United
States and is not substantially transformed by its final assembly in
Thailand. Furthermore, as a product of the United States, it is
excepted from country of origin marking pursuant to 19 CFR
134.32(m).
Notice of this final determination will be given in the Federal
Register, as required by 19 CFR 177.29. Any party-at-interest other
than the party which requested this final determination may request,
pursuant to 19 CFR 177.31, that CBP reexamine the matter anew and
issue a new final determination. Pursuant to 19 CFR 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 U.S. Court of International Trade.
Sincerely,
Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.
[FR Doc. 2025-11466 Filed 6-20-25; 8:45 am]
BILLING CODE 9111-14-P