The country of origin of optical communication modules

N361656May 29, 2026OT:RR:NC:N2:209
CATEGORY: OriginMs. Jilly WangLanding Law Offices16/F, East Tower, Raffles City in the North Bund1089 Dongdaming Road, Hongkou DistrictShanghai 200082ChinaRE: The country of origin of optical communication modulesDear Ms. Wang:In your letter dated
May 20, 2026
, you requested a country of origin ruling on three models of opticaltransceiver modules on behalf of your client, Source Photonics Taiwan, Inc.The items concerned are high-speed optical communication modules, model numbers SPQ2-8E2-8FO (800G2 × FR4 QSFP), SPQ-4E-DR (400G-DR4 QSFP-DD), and SPQ-4E-FR (400G-FR4 QSFP-DD). They arewidely deployed in data centers, telecommunications networks, and high-performance computing systems.These products are high-speed optical communication modules comprising of printed circuit boardassemblies (PCBA), optical sub-assemblies (OSA), and other structural components. In use, these moduleswould be mounted on opposite ends of a fiber optic cable and used to transmit data along that cable. Theyexecute an electro-optic conversion on the transmitter side and opto-electronic conversion on the receiverside.These three modules were previously ruled upon in New York ruling letter N359369, dated March 17, 2026.The production process has undergone changes, requiring a new, additional ruling.The three different optical transceiver modules undergo the same manufacturing process.Manufacturing is undertaken in China and Taiwan.In Taiwan, the main PCBA is manufactured using surface mount technology (SMT). At this point, the DigitalSignal Processors (DSP), Microcontroller Units (MCU), and other Integrated Circuits (IC) are mounted to theprinted circuit board along with various other active and passive components.
The optical sub-assembly (OSA) is manufactured in . The process includes manufacturing the opticalChinachip and then packaging that chip and performing alignment processes.When determining the country of origin for purposes of applying current trade remedies under Section 301and additional duties, the substantial transformation analysis is applicable. See, e.g., Headquarters RulingLetter H301619, dated November 6, 2018. The test for determining whether a substantial transformation willoccur is whether an article emerges from a process with a new name, character, or use different from thatpossessed by the article prior to processing. See Texas Instruments Inc. v. United States, 681 F.2d 778(C.C.P.A. 1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v.United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993).Based upon the facts presented, it is the opinion of this office that the character of this product is imparted by the main PCBA which is considered the dominant component of this assembly (see rulings, H335829, dated February 26, 2025, N358465, dated February 27, 2026, N352670, dated September 10, 2025, N344720, datedJanuary 13, 2025, and N342247, dated September 20, 2024). The manufacturing processes that take place within to create the main PCBA are both substantial and complex. The manufacturing process thatTaiwan takes place in does not change the end use of the main PCBA. The PCBA does not undergo aChina substantial transformation as a result of the processing. Therefore, since a substantial transformationChinese occur as a result of the processing, the country of origin for purposes ofapplying trade remediessTaiwanese under Section 301 will be .TaiwanThe holding set forth above applies only to the specific factual situation and merchandise description asidentified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations(CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of theinformation furnished in the ruling letter, whether directly, by reference, or by implication, is accurate andcomplete in every material respect. In the event that the facts are modified in any way, or if the goods do notconform to these facts at time of importation, you should bring this to the attention of U.S. Customs andBorder Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2.Additionally, we note that the material facts described in the foregoing ruling may be subject to periodicverification by CBP.This ruling is being issued under the provisions of Part 177 of the Customs and Border ProtectionRegulations (19 C.F.R. 177).A copy of the ruling or the control number indicated above should be provided with the entry documentsfiled at the time this merchandise is imported. If you have any questions regarding the ruling, please contactNational Import Specialist Steven Pollichino at [email protected].
Sincerely,
(for)James P. ForkanDirectorNational Commodity Specialist Division