CBP Finds Origin of Automotive Lamps Is Source of LED Boards, Not Final Assembly

Light-emitting diode lamps imported by Grakon for incorporation into automobiles originate in the country where the lights inside the lamps were assembled, Mexico, rather than the country of the lamps’ final assembly, and are not subject to Section 301 tariffs on products from China, CBP said in a recent ruling.

Grakon imports the assembled LED door lamps, dome lights and exterior marker lamps from China, where they are put together from lenses, housings, hardware and wiring from several countries, including China and Mexico, as well as printed circuit board assemblies with LEDs that make up the light source and are previously assembled in Mexico. The printed circuit board assemblies (PCBA), which incorporate LEDs made in Japan and the U.S., constitute from 15.34% to 57.52% of the total value of each fully assembled lamp, depending on the type, CBP said in the ruling, HQ 304910.

The Court of International Trade has previously found that a substantial transformation, as required to change country of origin for the purposes of Section 301 tariffs, does not occur when the end-use of an assembly’s parts was already determined at the time of importation, unless the assembly is complex. Additionally, in past rulings, CBP has found that the origin of a light source is a “significant factor in determining country of origin of a product,” and that the assembly manufacture of components into a printed circuit board assembly is a substantial transformation.

In its ruling, issued in April but not released until July, CBP found that the manufacture of the LED printed circuit board assemblies in Mexico resulted in a substantial transformation conferring a Mexico country of origin. The assembly in China, on the other hand, does not change the name, shape or material composition of the component parts, and the processes involved are minor.

“While the plastic lenses and reflector contribute to the car lamps ability to diffuse the light in accordance with customer expectations … the PCBA is already a complete light source with a fully integrated LED and circuitry,” CBP said. “The parts still retain their names once assembly is complete. For example, the lens is still the lens and the gasket is still the gasket,” it said. “Therefore, we find that the country of origin of the LED vehicle lamps is Mexico, where the PCBA with LED lights is manufactured, and Section 301 measures do not apply.”