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NY N015866

September 6, 2007

MAR-2 RR:NC:N1:109


Mr. Lars-Erik A. Hjelm
Counsel to RADVISION, Inc.
Akin Gump Strauss Hauer & Feld, LLP
Robert S. Strauss Building
1333 New Hampshire Avenue,, N.W.
Washington, DC 20036-1564


Dear Mr. Hjelm:

This is in response to your letter dated August 14, 2007, filed on behalf of your client RADVISION, Inc. Your letter addresses whether certain merchandise imported into the United States by your client, is exempt from country of origin marking because it undergoes a substantial transformation in the United States.

As confirmed during a telephone conversation with Ms. Tatman Ryder Savio, a representative of your company, RADVISION, Inc. imports bare printed circuit boards and chassis that are utilized in an assembly process in which three different types of videoconferencing equipment is manufactured, namely the SCOPIA 100, SCOPIA 400, and SCOPIA 1000. Some of the imported bare printed circuit boards are manufactured in China and others are manufactured in the Philippines. The chassis that RADVISION imports are manufactured in Switzerland. Some of the chassis that are utilized during the assembly process are manufactured in the United States. However, RADVISION does not import those chassis, rather they source them from companies located in the U.S. Therefore, this ruling letter will address the country of origin marking for the bare printed circuit boards from China and the Philippines and the chassis from Switzerland.

The assembly operation takes place at A.L.E. Electronics Inc.’s, (A.L.E.) facility, a subcontractor of RADVISION, located in New Jersey. At A.L.E.’s New Jersey facility, the printed circuit boards are populated with various types of electronic components that are manufactured overseas and purchased by RADVISION from suppliers in the United States. The electronic components include transistors, capacitors, diodes, integrated circuits, memory device, digital signal processors, and microprocessors. The populated printed circuit boards (aka printed circuit board assemblies) are assembled into the chassis, which upon importation into the United States, consist of metal sheets, covers, panels, electrical boards, and electrical fans. The chassis containing the printed circuit board assemblies complete the hardware for the video conferencing equipment, i.e. the SCOPIA 100, SCOPIA 400, and SCOPIA 1000. Lastly, software is installed into the chassis. Prior to the installation of the software, the microprocessors on the printed circuit board assemblies are not capable of processing information.

The marking statute, Section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) 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 the ultimate purchaser in the United States the English name of the country of origin of the article.

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.41(b), Customs Regulations (19 CFR 134.41(b)), mandates that the ultimate purchaser in the United States must be able to find the marking easily and read it without strain. Section 134.1(d) defines the ultimate purchaser as generally the last person in the United States who will receive the article in the form in which it was imported. 19 CFR 134.1(d)(1) states that if an imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported article to a process which results in a substantial transformation of the article. The case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that an article used in manufacture which results in an article having a name, character or use differing from that of the constituent article will be considered substantially transformed and that the manufacturer or processor will be considered the ultimate purchaser of the constituent materials. In such circumstances, the imported article is excepted from marking and only the outermost container is required to be marked. See, 19 CFR 134.35.

In this case, the imported bare printed circuit boards and the chassis are substantially transformed as a result of the processing in the United States. As a result, the manufacturer in the United States is the ultimate purchaser of the imported bare printed circuit boards. Under 19 CFR 134.35 only the containers which reach the ultimate purchaser are required to be marked with the country of origin. As such, upon importation into the United States, the container that the bare printed circuit boards are shipped in should be marked "Made in China” or “Made in the Philippines" depending on which of these two countries the instant bare printed circuit boards were manufactured in. The containers in which the chassis are imported into the United States should be marked “Made in Switzerland.”

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Linda M. Hackett at 646-733-3015.


Robert B. Swierupski

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