The country of origin of Organic Light-Emitting Diode (OLED) Modules

N315288 November 3, 2020 ORG-2 OT:RR:NC:N2:208 CATEGORY: Country of Origin Rachel Lee FNS Customs Brokers, Inc. 1545 Francisco St. Torrance, California 90501 RE: The country of origin of Organic Light-Emitting Diode (OLED) Modules Dear Ms. Lee: In your letter dated October1 17 2020, you requested a country of origin ruling on behalf of your client, LG Display America, Inc. The merchandise under consideration is Organic Light-Emitting Diode (OLED) Modules for TV and Public Displays (PD). The model numbers start with LE for TV OLED and LW for PD OLED and the number after LE/LW indicates the size of the screen in inches. Within Korea the OLED semi-finished products (OLED Panels) are manufactured. The OLED panels are exported to China where the finished products (OLED Modules) are assembled. The finished OLED Modules are sent back to Korea, and then exported to the United States. The thin-film transistor (TFT) manufacturing and organic light emitting diode (OLED) deposition and encapsulation process, which creates the OLED panel, takes place within Korea. The OLED panel is then sent to China. In China, the module manufacturing takes place. This process involves polarization, connecting a PCB (drive/control circuitry), assembling the backlight and other parts to the OLED panel. A complete explanation/illustration of the manufacturing process has been submitted to CBP. 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 U.S. 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 U.S. the English name of the country of origin of the article. For tariff purposes, the courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987). Based upon the facts presented, it is the opinion of this office that the Korean OLED panel, which is the dominant component of the OLED module, does not undergo a substantial transformation as a result of the processing that takes place in China. The OLED panel has a predetermined end use when it is exported from Korea and retains that identity after the processing that takes place within China. Therefore, since a substantial transformation does not occur as a result of the Chinese processing, the country of origin of the finished OLED module will be Korea for origin and marking purposes at time of importation into the United States. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 Lisa Cariello at [email protected]. Sincerely, Steven A. Mack Director National Commodity Specialist Division