Notice of Issuance of Final Determination Concerning Desktop Scanners, 54563-54566 [05-18359]
Download as PDF
<![CDATA[
Federal Register / Vol. 70, No. 178 / Thursday, September 15, 2005 / Notices
20850, 240–276–0106.
For biologics issues: Carol Rehkopf,
Center for Biologics Evaluation and
Research (HFM–650), Food and
Drug Administration, 1401
Rockville Pike, Rockville, MD
20852, 301–827–6202.
SUPPLEMENTARY INFORMATION:
I. Background
On October 26, 2002, the Medical
Device User Fee and Modernization Act
of 2002 (MDUFMA) (Public Law 107–
250) was signed into law. Section 201 of
MDUFMA amends the Federal Food,
Drug, and Cosmetic Act (the act) by
adding new provisions authorizing FDA
to establish a voluntary inspection
program under which eligible
manufacturers of class II or class III
devices can elect to have FDAaccredited third parties conduct some of
their establishment inspections instead
of FDA. Certain technical corrections
were subsequently made to these
provisions by the Medical Devices
Technical Corrections Act (MDTCA)
(Public Law 108–214), which was
enacted on April 1, 2004. FDA
announced in the Federal Register of
June 3, 2004 (69 FR 31397), the
availability of a draft guidance
document entitled ‘‘Requests for
Inspection by an Accredited Person
under the Inspections by Accredited
Persons Program Authorized by Section
201 of the Medical Device User Fee and
Modernization Act of 2002,’’ and
invited interested persons to comment
by September 1, 2004.
One person submitted a comment in
response to the draft guidance. The
comment suggested, among other things,
that partial inspections during a 2-year
period should be permitted without the
need for establishments to have to
reapply to participate in the AP Program
after each partial inspection. The
comment further suggested that the
guidance be revised to explicitly state
that complete inspections conducted by
APs under the new program which
result in either a ‘‘No Action Indicated’’
or ‘‘Voluntary Action Indicated’’
classification can satisfy FDA’s biennial
establishment inspection requirement
under section 510(h) of the act (21
U.S.C. 360(h)). The agency carefully
considered the comment while
finalizing the guidance and has revised
the document accordingly.
II. Significance of Guidance
This guidance is being issued
consistent with FDA’s good guidance
practices regulation (21 CFR 10.115).
The guidance represents the agency’s
current thinking on implementation of a
new program that allows third-party
VerDate Aug<18>2005
15:03 Sep 14, 2005
Jkt 205001
inspections of eligible device
establishments as authorized by section
201 of MDUFMA (as amended by
MDTCA). It does not create or confer
any rights for or on any person and does
not operate to bind FDA or the public.
An alternative approach may be used if
such approach satisfies the
requirements of the applicable statute
and regulations.
III. Electronic Access
To receive ‘‘Requests for Inspection
by an Accredited Person under the
Inspection by Accredited Persons
Program Authorized by Section 201 of
the Medical Device User Fee and
Modernization Act of 2002’’ by fax, call
the CDRH Facts-On-Demand system at
800–899–0381 or 301–827–0111 from a
touch-tone telephone. Press 1 to enter
the system. At the second voice prompt,
press 1 to order a document. Enter the
document number 1532 followed by the
pound sign (#). Follow the remaining
voice prompts to complete your request.
Persons interested in obtaining a copy
of the guidance may also do so by using
the Internet. The Center for Devices and
Radiological Health (CDRH) maintains
an entry on the Internet for easy access
to information including text, graphics,
and files that may be downloaded to a
personal computer with Internet access.
Updated on a regular basis, the CDRH
home page includes device safety alerts,
Federal Register reprints, information
on premarket submissions (including
lists of approved applications and
manufacturers’ addresses), small
manufacturer’s assistance, information
on video conferencing and electronic
submissions, Mammography Matters,
and other device-oriented information.
The CDRH Web site may be accessed at
https://www.fda.gov/cdrh. A search
capability for all CDRH guidance
documents is available at https://
www.fda.gov/cdrh/guidance.html.
Guidance documents are also available
on the Division of Dockets Management
Internet site at https://www.fda.gov/
ohrms/dockets.
IV. Paperwork Reduction Act of 1995
This guidance contains information
collection provisions that are subject to
review by the Office of Management and
Budget (OMB) under the Paperwork
Reduction Act of 1995 (the PRA) (44
U.S.C. 3501–3520). The collections of
information addressed in the guidance
document have been approved by OMB
in accordance with the PRA under the
regulations governing the agency
request or requirement that members of
the public submit reports, keep records,
or provide information to a third party.
The provisions addressed in the
PO 00000
Frm 00044
Fmt 4703
Sfmt 4703
54563
guidance have been approved by OMB
under OMB control number 0910–0569.
This approval expires on August 31,
2008. An agency may not conduct or
sponsor, and a person is not required to
respond to, a collection of information
unless it displays a currently valid OMB
control number.
V. Comments
Interested persons may submit to the
Division of Dockets Management (see
ADDRESSES) written or electronic
comments regarding this document.
Submit a single copy of electronic
comments or two paper copies of any
mailed comments, except that
individuals may submit one paper copy.
Comments are to be identified with the
docket number found in brackets in the
heading of this document. Received
comments may be seen in the Division
of Dockets Management between 9 a.m.
and 4 p.m., Monday through Friday.
Dated: September 9, 2005.
Jeffrey Shuren,
Assistant Commissioner for Policy.
[FR Doc. 05–18364 Filed 9–14–05; 8:45 am]
BILLING CODE 4160–01–S
DEPARTMENT OF HOMELAND
SECURITY
Bureau of U.S. Customs and Border
Protection
Notice of Issuance of Final
Determination Concerning Desktop
Scanners
U.S. Customs and Border
Protection, Department of Homeland
Security.
ACTION: Notice of final determination.
AGENCY:
SUMMARY: This document provides
notice that the Bureau of Customs and
Border Protection (CBP) has issued a
final determination concerning the
country of origin of certain desktop
scanners to be offered to the United
States Government under an
undesignated government procurement
contract. The final determination found
that, based upon the facts presented, the
United States is the country of origin of
the Kodak i600 line of desktop scanners
for purposes of U.S. Government
procurement. The Kodak i600 series
includes the i620, i640, and i660
models.
DATES: The final determination was
issued on September 9, 2005. 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 within 30 days
of September 15, 2005.
E:\FR\FM\15SEN1.SGM
15SEN1
54564
Federal Register / Vol. 70, No. 178 / Thursday, September 15, 2005 / Notices
Ed
Caldwell, Valuation and Special
Programs Branch, Office of Regulations
and Rulings (202–572–8872).
SUPPLEMENTARY INFORMATION: Notice is
hereby given that on September 9, 2005,
pursuant to subpart B of part 177,
Customs Regulations (19 CFR part 177,
subpart B), CBP issued a final
determination concerning the country of
origin of certain desktop scanners to be
offered to the United States Government
under an undesignated government
procurement contract. The CBP ruling
number is HQ 563294. This final
determination was issued at the request
of Eastman Kodak Company 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).
The final determination concluded
that, based upon the facts presented, the
assembly in the United States of parts of
various origins to create the Kodak i600
scanners substantially transformed the
imported parts used in production.
Section 177.29, Customs Regulations
(19 CFR 177.29), provides that notice of
final determinations shall be published
in the Federal Register within 60 days
of the date the final determination is
issued. Section 177.30, Customs
Regulations (19 CFR 177.30), states 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.
FOR FURTHER INFORMATION CONTACT:
Dated: September 9, 2005.
Michael T. Schmitz,
Assistant Commissioner, Office of
Regulations and Rulings.
Attachment
HQ 563294
September 9, 2005.
MAR–2–05 RR:CR:SM 563294 EAC
Category: Marking.
Mr. Alan W.H. Gourley, Crowell & Moring
LLP, 1001 Pennsylvania Avenue, NW.,
Washington, DC 20004–2595
RE: U.S. Government Procurement; Final
Determination; country of origin of
desktop scanners; substantial
transformation; 19 CFR part 177
Dear Mr. Gourley:
This is in response to your letter dated
June 3, 2005, requesting a final determination
on behalf of Eastman Kodak Company
(‘‘Kodak’’), pursuant to subpart B of part 177,
Customs Regulations (19 CFR 177.21 et seq.).
Under these regulations, which implement
Title III of the Trade Agreements Act of 1979,
as amended (19 U.S.C. 2411 et seq.), U.S.
Customs and Border Protection (‘‘CBP’’)
issues country of origin advisory rulings and
final determinations on whether an article is
VerDate Aug<18>2005
15:03 Sep 14, 2005
Jkt 205001
or would be a product of a designated foreign
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.
This final determination concerns the
country of origin of certain desktop scanners
that Kodak is considering selling to the U.S.
Government. We note that Kodak is a partyat-interest within the meaning of 19 CFR
177.22(d)(2) and is entitled to request this
final determination.
Facts:
I. Background
We are advised that the scanners under
consideration consist of the three models
within Kodak’s i600 line of scanners, the
i620, i640, and i660. The Kodak i600 Series
Scanners are desktop scanners that have the
primary function of creating electronic
images from paper documents. Paper
documents of various sizes, dimensions, and
types may be fed into the scanners, viewed
through cameras, and converted into
electronic images. The scanners can process
these images at a rate of up to 480 per
minute. In addition, the scanners have a
number of features to enhance their
performance and improve the quality of the
images they produce, such as skew angle
determination, which detects and corrects
images fed at an angle, and electronic color
dropout, which removes irrelevant
background color from images.
The primary difference between these
models is the speed at which they are able
to process images, with the i660 able to
process images most quickly. The mechanical
components and manufacturing processes
used to build the different models are nearly
identical. The differences in processing
speed are attributable to differences between
the programming solutions that are installed
on the scanners. Kodak developed the
programming for the i600 line of scanners in
the United States.
II. Component Parts and Subassemblies
Kodak has manufactured its i600 series
scanners both in its Rochester, New York
facility and in a facility located in Shanghai,
China. Many, but not all, of the parts used
in the manufacture of the scanners are
obtained from Chinese sources. The i600
scanners are comprised of 13 major
subassemblies. Regardless of whether the
scanners are manufactured to completion in
the United States or China, the Shanghai
facility also assembles three of the thirteen
major subassemblies for the scanners from
parts of U.S., Chinese, and other origins.
The present ruling request pertains only to
Kodak i600 scanners to be manufactured in
the United States from parts shipped from
China, but sourced from various countries
abroad.
Each subassembly performs a specific
function and together, with miscellaneous
other components and hardware, constitute a
finished product capable of electronically
scanning a variety of paper images. The
finished scanners consist of approximately
600 individual parts. The major
subassemblies are identified and described as
follows.
PO 00000
Frm 00045
Fmt 4703
Sfmt 4703
Operator Control Panel (‘‘OCP’’) Assembly:
This assembly provides the interface between
the user and scanner, including wiring and
the power switch used to turn the machine
on and off.
Elevator Assembly: This assembly lifts the
paper to the proper height to be fed into the
machine for scanning without jamming the
feed.
Carriage Assembly: This assembly is
located at the front of the machine where
paper is fed, and includes a metal tray upon
which paper rests as it is fed into the
scanner. The carriage assembly also includes
the lead edge of the paper transport system
which has a separation roller that ensures the
top sheet of paper is separated from those
below.
Feed Module Assembly: This assembly is
set above the carriage assembly where it
grabs the top sheet of paper and feeds it into
the scanner.
Image Baffle Assembly: Each scanner
includes two image baffle assemblies. Each
assembly has a glass plate through which a
camera module views paper for scanning.
There are two such assemblies because
separate cameras view the front and back of
each document as it moves through the
scanner.
Backup Baffle Assembly: Each scanner
includes two backup baffle assemblies. Each
assembly is adjacent to the paper path where
it guides the paper through the scanner and
helps assure the paper feeds cleanly through
the machine and does not jam. Each
assembly also includes a backup strip, which
provides a background for documents as they
are viewed by a camera. There is one backup
baffle assembly for each of the image baffle
assemblies.
Camera Modules (Upper and Lower): Each
scanner includes two camera modules. The
camera modules include mirrors and lenses
used to view documents as they are fed
through the scanner. Each camera module
views and electronically captures a different
side of the document. The upper camera
module is part of the pod assembly. The
lower camera module is located below the
paper path. As the camera modules view a
document, the light images they detect are
converted into raw electronic data using a
charge couple device. That raw data is
amplified and forwarded to the ‘‘E-box’’,
where the data is converted into an electronic
image.
Pod Assembly: The pod assembly is the top
portion of the machine, which can be opened
to provide access to the paper path. The
components in this assembly operate together
to feed a document through the machine and
to view one side of the document during
scanning. This assembly includes numerous
parts, as well as the following major
subassemblies: (a) The upper camera module;
(b) an image baffle assembly; and (c) a
backup baffle assembly.
E-Box Assembly: This assembly contains
the central ‘‘brain’’ of the machine, and it
converts raw electronic data from the camera
assembly into high quality electronic images.
The E-box Assembly incorporates two circuit
boards, the machine control board (‘‘MCB’’)
and the image processing board (‘‘IPB’’).
Shroud Assembly and Cabinetry: These
pieces are the cosmetic cabinetry that
E:\FR\FM\15SEN1.SGM
15SEN1
Federal Register / Vol. 70, No. 178 / Thursday, September 15, 2005 / Notices
encompass and form the outside of the
machine.
Under the proposed production scenario,
Kodak will purchase the two ‘‘camera
modules’’ and the ‘‘feed module’’ as
assembled units from its Shanghai facility.
The Shanghai facility will assemble these
modules using various parts, including a
charge couple device for each camera
module, which is purchased from the United
States. The other major subassemblies will be
manufactured in Rochester, New York, using
component parts purchased from inventory
at the Shanghai facility. It is envisioned that
the Rochester facility will purchase the
necessary number of parts, but that they
would not be packaged or inventoried as kits.
The parts inventoried at the Shanghai facility
are sourced primarily from China, but
include components from such designated
countries as the United States, Canada, Japan,
and Korea.
III. The Assembly Process
We are informed that assembly of the
scanners at the Rochester facility requires
approximately four to six hours of work
encompassing essentially five stages: (a)
Manufacturing most of the major
subassemblies; (b) building the pod
assembly; (c) performing the ‘‘main build’;
(d) performing ‘‘end of line’’ procedures; and
(e) packaging. During these stages, the
machine is built, the firmware that allows the
machine to work as a scanner is loaded, the
major subassemblies and the integrated
circuit are tested, and the scanner’s
parameters are set to enable proper operation.
1. Manufacture of Major Subassemblies
The first step of production involves
assemblage of most of the scanner’s major
subassemblies. In order to demonstrate the
complexity of these operations, a description
of the operations undertaken to assemble the
E-box assembly has been provided. As noted
above, the E-box Assembly contains the
central brain of the machine and is a key
component for ensuring the proper function
and quality of the scanning operation. It
contains approximately 50 individual parts
that technicians in the United States must
assemble. The building process includes,
among other things, mounting a CPU board
to a base and adding to that CPU board a
programmed chip that enables and controls
processing speed. Other operations
performed include mounting gaskets and a
card cage, installing electromagnetic
interference (‘‘EMI’’) gaskets, installing the
machine control board (‘‘MCB’’) and image
processing board (‘‘IPB’’) circuit boards,
attaching a power supply to the CPU board,
mounting a fan and installing an air duct,
and attaching a cover to the base.
During this stage of production,
technicians also build the OCP, elevator,
carriage, image baffle, backup baffle, and
shroud assemblies. At the end of this
production stage, these subassemblies are
complete and ready to undergo further
processing.
2. Building the Pod Assembly
After completing the major subassemblies
set forth above, the technicians begin
assembling the pod assembly, which is the
VerDate Aug<18>2005
15:03 Sep 14, 2005
Jkt 205001
top of the scanner. The technicians use the
upper camera module, image baffle assembly,
backup baffle assembly, and approximately
180 additional parts to build the pod
assembly. Additional parts that must be
integrated during this manufacturing stage
include lamp inverters, air ducts, dust seals,
video cables, blowers, air filters, rollers,
support baffles, lamps, clutches, gears, and
shafts. Special fixtures and tooling are used
to build the pod assembly.
3. Main Build
After building the pod assembly, the
technicians manufacture the bottom of the
scanner, integrate the pod assembly, make
fine adjustments to the unit, and perform
certain testing operations. This stage of
production is referred to as the ‘‘main build.’’
During the main build, technicians
integrate the elevator, carriage, image baffle,
backup baffle, E-box, shroud, OCP, and lower
camera subassemblies, along with literally
hundreds of additional parts. The additional
parts include components such as camera
mounts, lamp invertors, latch handles,
bumpers, stops, slide blocks, bushings,
brackets, gaskets, wires, air ducts, UDDS
emitter boards (a circuit board for the
ultrasonic double document sensor, which is
used to detect misfeeds), electronic
grounding jacks, elevator position sensors,
carriage plates, motors, lamps, shafts, belts,
blowers, air filters, foam seals, bearings,
cables, switch actuators, and exterior
cabinetry. The technicians also attach the
pod assembly with a special fixture during
this stage.
Technicians perform quality assurance
checks throughout the main build and also
use special fixtures designed to test electrical
grounding.
4. End of Line Procedures
During this phase of production, additional
quality control checks are conducted to
ensure, for example, that the OCP cover is
correctly installed, that all wires are dressed
correctly, that the pod latches operate
properly, and that glass and roller
components are clean and ready for
operation. The feeder module is then
installed along with a separation roller and
a separation pad. It is stated that the core
elements of this stage of production,
however, are operations such as
programming, testing, and calibration of the
machine.
The technicians program the equipment by
inputting Kodak’s proprietary firmware
designed for the i600 line of scanners. This
firmware was developed by Kodak’s Software
Engineering Group within the United States
and is considered the ‘‘intelligence’’ of the
scanner. The firmware provides the
programming that will control machine
function and the algorithms to process
images.
The technicians load the firmware using
Kodak’s Scanner Validation Tool (‘‘SVT’’),
which is a software package also developed
and provided by Kodak’s Software
Engineering Group. In order to perform this
task, technicians connect the scanner to a
computer with the SVT and firmware already
loaded. They then use the SVT to transfer the
PO 00000
Frm 00046
Fmt 4703
Sfmt 4703
54565
firmware onto the scanner. This process
installs the firmware onto the IPB circuit
board and CPU circuit board, which the
technicians previously installed during
manufacture of the E-box subassembly.
Once the firmware is loaded onto the
scanner, the technicians use the SVT and the
firmware to calibrate and test the responses
of the machine for specific inputs. These
testing and calibration operations include
procedures such as calibration of the UDDS
system, calibration of the scanner for
brightness, calibration of the scanner’s speed,
and measurement of image quality.
5. Packaging
Once the end of line procedures are
completed, the assembled scanners are
visually inspected and packaged for
shipment.
Issue: Whether the assembled Kodak i600
line of scanners are considered to be
products of the United States for purposes of
U.S. Government procurement.
Law and Analysis: Pursuant to Subpart B
of Part 177, 19 CFR 177.21 et seq., which
implements Title III of the Trade Agreements
Act of 1979, as amended (19 U.S.C. 2511 et
seq.), CBP issues country of origin advisory
rulings and final determinations on whether
an article is or would be a product of a
designated country or instrumentality for the
purposes of granting waivers of certain ‘‘Buy
American’’ restrictions in U.S. law or
practice for products offered for sale to the
U.S. Government.
Under the rule of origin set forth under 19
U.S.C. 2518(4)(B):
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 determining whether the combining of
parts or materials constitutes a substantial
transformation, the determinative issue is the
extent of operations performed and whether
the parts lose their identity and become an
integral part of the new article. Belcrest
Linens v. United States, 573 F. Supp. 1149
(CIT 1983), aff’d, 741 F.2d 1368 (Fed. Cir.
1984). Assembly operations that are minimal
or simple, as opposed to complex or
meaningful, will generally not result in a
substantial transformation. See, C.S.D. 80–
111, C.S.D. 85–25, C.S.D. 89–110, C.S.D. 89–
118, C.S.D. 90–51, and C.S.D. 90–97. In
C.S.D. 85–25, 19 Cust. Bull. 844 (1985), CBP
held that for purposes of the Generalized
System of Preferences (‘‘GSP’’), the assembly
of a large number of fabricated components
onto a printed circuit board in a process
involving a considerable amount of time and
skill resulted in a substantial transformation.
In that case, in excess of 50 discrete
fabricated components (such as resistors,
capacitors, diodes, integrated circuits,
sockets, and connectors) were assembled.
CBP has held in a number of cases
involving similar type equipment that
E:\FR\FM\15SEN1.SGM
15SEN1
54566
Federal Register / Vol. 70, No. 178 / Thursday, September 15, 2005 / Notices
complex and meaningful assembly
operations involving a large number of
components will generally result in a
substantial transformation. For example, in
Headquarters Ruling Letter (‘‘HRL’’) 562495
dated November 13, 2002, color ink jet
printers were assembled in Singapore of
components imported from a number of other
countries. CBP determined that the imported
components were substantially transformed
during assembly such that the country of
origin of the assembled ink jet printers was
Singapore. In support of this position, CBP
recognized that the processing operations
that occurred within Singapore were
complex and extensive, required the
integration of 13 major subassemblies to the
chassis, and that the resulting product was a
new and distinct article of commerce that
possessed a new name, character, and use.
In HRL 561734 dated March 22, 2001,
published in the Federal Register on March
29, 2001 (66 FR 17222), CBP held that certain
multi-functional machines (consisting of
printer, copier, and fax machines) assembled
in Japan were a product of that country for
purposes of U.S. Government procurement.
The multi-functional machines were
assembled from 227 parts (108 parts obtained
from Japan, 92 from Thailand, 3 from China,
and 24 from other countries) and eight
subassemblies, each of which was assembled
in Japan. One of the subassemblies produced
in Japan, referred to as the scanner unit, was
described as the ‘‘heart of the machine.’’ In
finding that the imported parts were
substantially transformed in Japan, CBP
stated that the individual parts and
components lost their separate identities
when they became part of the multifunctional machine. See also, HRL 561568
dated March 22, 2001, published in the
Federal Register on March 29, 2001 (66 FR
17222).
By contrast, assembly operations that are
minimal or simple will generally not result
in a substantial transformation. For example,
in HRL 734050 dated June 17, 1991, CBP
held that Japanese-origin components were
not substantially transformed in China when
assembled in that country to form finished
printers. The printers consisted of five main
components identified as the ‘‘head’’,
‘‘mechanism’’, ‘‘circuit’’, ‘‘power source’’,
and ‘‘outer case.’’ The circuit, power source
and outer case units were entirely assembled
or molded in Japan. The head and
mechanical units were made in Japan but
exported to China in an unassembled state.
All five units were exported to China where
the head and mechanical units were
assembled with screws and screwdrivers.
Thereafter, the head, mechanism, circuit, and
power source units were mounted onto the
outer case with screws and screwdrivers. In
holding that the country of origin of the
assembled printers was Japan, CBP
recognized that the vast majority of the
printer’s parts were of Japanese origin and
that the operations performed in China were
relatively simple assembly operations.
The programming operations performed in
the instant case must also be considered. In
Data General Corporation v. United States, 4
CIT 182 (1982), the Court of International
Trade held that a PROM (programmable readonly memory) fabricated in a foreign country
but programmed in the United States for use
in a computer circuit board assembled abroad
was substantially transformed. In Data
General, the court stated that the electronic
pattern introduced into the circuit by
programming gave the PROM the function as
a read only memory and that the essence of
the article, its pattern of interconnection or
stored memory, was established by
programming.
As applied, we find that the various
foreign-origin parts are substantially
transformed within the United States when
assembled to form the Kodak i600 line of
scanners in the manner set forth above. In
making this determination we note that the
scanners are comprised of approximately 600
parts and thirteen subassemblies. Ten of the
subassemblies are assembled to completion
within the United States during a complex
and meaningful process. Illustrative
examples of two major subassemblies built to
completion in the United States are the E-Box
assembly (comprised of approximately 50
parts) and the pod assembly (comprised of
more than 180 parts). During the main build
phase of production, the various
subassemblies and literally hundreds of
additional parts are assembled together to
form the scanners. Specialized fixtures,
tooling, and other equipment are used
throughout assembly to align, test, and
calibrate the scanners as they are built. After
assembly, the scanners are programmed with
firmware developed in the United States,
which constitutes the intelligence of the
scanners. During such assembly and
programming operations, the individual
components and subassemblies of foreignorigin are subsumed into a new and distinct
article of commerce that has a new name,
character, and use. Therefore, we find that
the country of origin of the Kodak i600
scanners for purposes of U.S. Government
procurement is the United States.
Holding: Based upon the specific facts of
this case, we find that the individual
components and subassemblies imported
into the United States are substantially
transformed when assembled in the manner
set forth above to form Kodak i600 desktop
scanners. Therefore, the country of origin of
the Kodak i600 line of desktop scanners for
purposes of U.S. Government procurement is
the United States.
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.
Any party-at-interest may, within 30 days
after publication of the Federal Register
notice referenced above, seek judicial review
of this final determination before the Court
of International Trade.
Sincerely,
Michael T. Schmitz,
Assistant Commissioner, Office of
Regulations and Rulings.
[FR Doc. 05–18359 Filed 9–14–05; 8:45 am]
BILLING CODE 9110–06–P
DEPARTMENT OF HOMELAND
SECURITY
Bureau of Customs and Border
Protection
Notice of Cancellation of Customs
Broker License Due to Death of the
License Holder
Bureau of Customs and Border
Protection, U.S. Department of
Homeland Security.
ACTION: General notice.
AGENCY:
SUMMARY: Notice is hereby given that,
pursuant to Title 19 of the Code of
Federal Regulations § 111.51(a), the
following individual Customs broker
licenses and any and all permits have
been cancelled due to the death of the
broker:
Thomas A. Borgia ...
Karl A. Becnel .........
Jkt 205001
PO 00000
Frm 00047
DEPARTMENT OF HOMELAND
SECURITY
Bureau of Customs and Border
Protection
Notice of Cancellation of Customs
Broker Permit
Bureau of Customs and Border
Protection, U.S. Department of
Homeland Security.
ACTION: General notice.
AGENCY:
SUMMARY: Pursuant to section 641 of the
Tariff Act of 1930, as amended, (19
U.S.C. 1641) and the Customs
Regulations (19 CFR 111.51), the
following Customs broker permits are
cancelled without prejudice.
Permit
Fmt 4703
Sfmt 4703
Miami.
New
Orleans.
BILLING CODE 9110–06–P
General Brokerage Services, Inc. .....................................................................................................................
15:03 Sep 14, 2005
10419
09684
Port name
Dated: September 8, 2005.
Jayson P. Ahern,
Assistant Commissioner, Office of Field
Operations.
[FR Doc. 05–18360 Filed 9–14–05; 8:45 am]
Name
VerDate Aug<18>2005
License
No.
Name
E:\FR\FM\15SEN1.SGM
H34
15SEN1
Issuing port
Miami.
]]>Agencies
[Federal Register Volume 70, Number 178 (Thursday, September 15, 2005)]
[Notices]
[Pages 54563-54566]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-18359]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOMELAND SECURITY
Bureau of U.S. Customs and Border Protection
Notice of Issuance of Final Determination Concerning Desktop
Scanners
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security.
ACTION: Notice of final determination.
-----------------------------------------------------------------------
SUMMARY: This document provides notice that the Bureau of Customs and
Border Protection (CBP) has issued a final determination concerning the
country of origin of certain desktop scanners to be offered to the
United States Government under an undesignated government procurement
contract. The final determination found that, based upon the facts
presented, the United States is the country of origin of the Kodak i600
line of desktop scanners for purposes of U.S. Government procurement.
The Kodak i600 series includes the i620, i640, and i660 models.
DATES: The final determination was issued on September 9, 2005. 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 within 30 days of September 15, 2005.
[[Page 54564]]
FOR FURTHER INFORMATION CONTACT: Ed Caldwell, Valuation and Special
Programs Branch, Office of Regulations and Rulings (202-572-8872).
SUPPLEMENTARY INFORMATION: Notice is hereby given that on September 9,
2005, pursuant to subpart B of part 177, Customs Regulations (19 CFR
part 177, subpart B), CBP issued a final determination concerning the
country of origin of certain desktop scanners to be offered to the
United States Government under an undesignated government procurement
contract. The CBP ruling number is HQ 563294. This final determination
was issued at the request of Eastman Kodak Company 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).
The final determination concluded that, based upon the facts
presented, the assembly in the United States of parts of various
origins to create the Kodak i600 scanners substantially transformed the
imported parts used in production.
Section 177.29, Customs Regulations (19 CFR 177.29), provides that
notice of final determinations shall be published in the Federal
Register within 60 days of the date the final determination is issued.
Section 177.30, Customs Regulations (19 CFR 177.30), states 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.
Dated: September 9, 2005.
Michael T. Schmitz,
Assistant Commissioner, Office of Regulations and Rulings.
Attachment
HQ 563294
September 9, 2005.
MAR-2-05 RR:CR:SM 563294 EAC
Category: Marking.
Mr. Alan W.H. Gourley, Crowell & Moring LLP, 1001 Pennsylvania
Avenue, NW., Washington, DC 20004-2595
RE: U.S. Government Procurement; Final Determination; country of
origin of desktop scanners; substantial transformation; 19 CFR part
177
Dear Mr. Gourley:
This is in response to your letter dated June 3, 2005,
requesting a final determination on behalf of Eastman Kodak Company
(``Kodak''), pursuant to subpart B of part 177, Customs Regulations
(19 CFR 177.21 et seq.). Under these regulations, which implement
Title III of the Trade Agreements Act of 1979, as amended (19 U.S.C.
2411 et seq.), U.S. Customs and Border Protection (``CBP'') issues
country of origin advisory rulings and final determinations on
whether an article is or would be a product of a designated foreign
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.
This final determination concerns the country of origin of
certain desktop scanners that Kodak is considering selling to the
U.S. Government. We note that Kodak is a party-at-interest within
the meaning of 19 CFR 177.22(d)(2) and is entitled to request this
final determination.
Facts:
I. Background
We are advised that the scanners under consideration consist of
the three models within Kodak's i600 line of scanners, the i620,
i640, and i660. The Kodak i600 Series Scanners are desktop scanners
that have the primary function of creating electronic images from
paper documents. Paper documents of various sizes, dimensions, and
types may be fed into the scanners, viewed through cameras, and
converted into electronic images. The scanners can process these
images at a rate of up to 480 per minute. In addition, the scanners
have a number of features to enhance their performance and improve
the quality of the images they produce, such as skew angle
determination, which detects and corrects images fed at an angle,
and electronic color dropout, which removes irrelevant background
color from images.
The primary difference between these models is the speed at
which they are able to process images, with the i660 able to process
images most quickly. The mechanical components and manufacturing
processes used to build the different models are nearly identical.
The differences in processing speed are attributable to differences
between the programming solutions that are installed on the
scanners. Kodak developed the programming for the i600 line of
scanners in the United States.
II. Component Parts and Subassemblies
Kodak has manufactured its i600 series scanners both in its
Rochester, New York facility and in a facility located in Shanghai,
China. Many, but not all, of the parts used in the manufacture of
the scanners are obtained from Chinese sources. The i600 scanners
are comprised of 13 major subassemblies. Regardless of whether the
scanners are manufactured to completion in the United States or
China, the Shanghai facility also assembles three of the thirteen
major subassemblies for the scanners from parts of U.S., Chinese,
and other origins.
The present ruling request pertains only to Kodak i600 scanners
to be manufactured in the United States from parts shipped from
China, but sourced from various countries abroad.
Each subassembly performs a specific function and together, with
miscellaneous other components and hardware, constitute a finished
product capable of electronically scanning a variety of paper
images. The finished scanners consist of approximately 600
individual parts. The major subassemblies are identified and
described as follows.
Operator Control Panel (``OCP'') Assembly: This assembly
provides the interface between the user and scanner, including
wiring and the power switch used to turn the machine on and off.
Elevator Assembly: This assembly lifts the paper to the proper
height to be fed into the machine for scanning without jamming the
feed.
Carriage Assembly: This assembly is located at the front of the
machine where paper is fed, and includes a metal tray upon which
paper rests as it is fed into the scanner. The carriage assembly
also includes the lead edge of the paper transport system which has
a separation roller that ensures the top sheet of paper is separated
from those below.
Feed Module Assembly: This assembly is set above the carriage
assembly where it grabs the top sheet of paper and feeds it into the
scanner.
Image Baffle Assembly: Each scanner includes two image baffle
assemblies. Each assembly has a glass plate through which a camera
module views paper for scanning. There are two such assemblies
because separate cameras view the front and back of each document as
it moves through the scanner.
Backup Baffle Assembly: Each scanner includes two backup baffle
assemblies. Each assembly is adjacent to the paper path where it
guides the paper through the scanner and helps assure the paper
feeds cleanly through the machine and does not jam. Each assembly
also includes a backup strip, which provides a background for
documents as they are viewed by a camera. There is one backup baffle
assembly for each of the image baffle assemblies.
Camera Modules (Upper and Lower): Each scanner includes two
camera modules. The camera modules include mirrors and lenses used
to view documents as they are fed through the scanner. Each camera
module views and electronically captures a different side of the
document. The upper camera module is part of the pod assembly. The
lower camera module is located below the paper path. As the camera
modules view a document, the light images they detect are converted
into raw electronic data using a charge couple device. That raw data
is amplified and forwarded to the ``E-box'', where the data is
converted into an electronic image.
Pod Assembly: The pod assembly is the top portion of the
machine, which can be opened to provide access to the paper path.
The components in this assembly operate together to feed a document
through the machine and to view one side of the document during
scanning. This assembly includes numerous parts, as well as the
following major subassemblies: (a) The upper camera module; (b) an
image baffle assembly; and (c) a backup baffle assembly.
E-Box Assembly: This assembly contains the central ``brain'' of
the machine, and it converts raw electronic data from the camera
assembly into high quality electronic images. The E-box Assembly
incorporates two circuit boards, the machine control board (``MCB'')
and the image processing board (``IPB'').
Shroud Assembly and Cabinetry: These pieces are the cosmetic
cabinetry that
[[Page 54565]]
encompass and form the outside of the machine.
Under the proposed production scenario, Kodak will purchase the
two ``camera modules'' and the ``feed module'' as assembled units
from its Shanghai facility. The Shanghai facility will assemble
these modules using various parts, including a charge couple device
for each camera module, which is purchased from the United States.
The other major subassemblies will be manufactured in Rochester, New
York, using component parts purchased from inventory at the Shanghai
facility. It is envisioned that the Rochester facility will purchase
the necessary number of parts, but that they would not be packaged
or inventoried as kits. The parts inventoried at the Shanghai
facility are sourced primarily from China, but include components
from such designated countries as the United States, Canada, Japan,
and Korea.
III. The Assembly Process
We are informed that assembly of the scanners at the Rochester
facility requires approximately four to six hours of work
encompassing essentially five stages: (a) Manufacturing most of the
major subassemblies; (b) building the pod assembly; (c) performing
the ``main build'; (d) performing ``end of line'' procedures; and
(e) packaging. During these stages, the machine is built, the
firmware that allows the machine to work as a scanner is loaded, the
major subassemblies and the integrated circuit are tested, and the
scanner's parameters are set to enable proper operation.
1. Manufacture of Major Subassemblies
The first step of production involves assemblage of most of the
scanner's major subassemblies. In order to demonstrate the
complexity of these operations, a description of the operations
undertaken to assemble the E-box assembly has been provided. As
noted above, the E-box Assembly contains the central brain of the
machine and is a key component for ensuring the proper function and
quality of the scanning operation. It contains approximately 50
individual parts that technicians in the United States must
assemble. The building process includes, among other things,
mounting a CPU board to a base and adding to that CPU board a
programmed chip that enables and controls processing speed. Other
operations performed include mounting gaskets and a card cage,
installing electromagnetic interference (``EMI'') gaskets,
installing the machine control board (``MCB'') and image processing
board (``IPB'') circuit boards, attaching a power supply to the CPU
board, mounting a fan and installing an air duct, and attaching a
cover to the base.
During this stage of production, technicians also build the OCP,
elevator, carriage, image baffle, backup baffle, and shroud
assemblies. At the end of this production stage, these subassemblies
are complete and ready to undergo further processing.
2. Building the Pod Assembly
After completing the major subassemblies set forth above, the
technicians begin assembling the pod assembly, which is the top of
the scanner. The technicians use the upper camera module, image
baffle assembly, backup baffle assembly, and approximately 180
additional parts to build the pod assembly. Additional parts that
must be integrated during this manufacturing stage include lamp
inverters, air ducts, dust seals, video cables, blowers, air
filters, rollers, support baffles, lamps, clutches, gears, and
shafts. Special fixtures and tooling are used to build the pod
assembly.
3. Main Build
After building the pod assembly, the technicians manufacture the
bottom of the scanner, integrate the pod assembly, make fine
adjustments to the unit, and perform certain testing operations.
This stage of production is referred to as the ``main build.''
During the main build, technicians integrate the elevator,
carriage, image baffle, backup baffle, E-box, shroud, OCP, and lower
camera subassemblies, along with literally hundreds of additional
parts. The additional parts include components such as camera
mounts, lamp invertors, latch handles, bumpers, stops, slide blocks,
bushings, brackets, gaskets, wires, air ducts, UDDS emitter boards
(a circuit board for the ultrasonic double document sensor, which is
used to detect misfeeds), electronic grounding jacks, elevator
position sensors, carriage plates, motors, lamps, shafts, belts,
blowers, air filters, foam seals, bearings, cables, switch
actuators, and exterior cabinetry. The technicians also attach the
pod assembly with a special fixture during this stage.
Technicians perform quality assurance checks throughout the main
build and also use special fixtures designed to test electrical
grounding.
4. End of Line Procedures
During this phase of production, additional quality control
checks are conducted to ensure, for example, that the OCP cover is
correctly installed, that all wires are dressed correctly, that the
pod latches operate properly, and that glass and roller components
are clean and ready for operation. The feeder module is then
installed along with a separation roller and a separation pad. It is
stated that the core elements of this stage of production, however,
are operations such as programming, testing, and calibration of the
machine.
The technicians program the equipment by inputting Kodak's
proprietary firmware designed for the i600 line of scanners. This
firmware was developed by Kodak's Software Engineering Group within
the United States and is considered the ``intelligence'' of the
scanner. The firmware provides the programming that will control
machine function and the algorithms to process images.
The technicians load the firmware using Kodak's Scanner
Validation Tool (``SVT''), which is a software package also
developed and provided by Kodak's Software Engineering Group. In
order to perform this task, technicians connect the scanner to a
computer with the SVT and firmware already loaded. They then use the
SVT to transfer the firmware onto the scanner. This process installs
the firmware onto the IPB circuit board and CPU circuit board, which
the technicians previously installed during manufacture of the E-box
subassembly.
Once the firmware is loaded onto the scanner, the technicians
use the SVT and the firmware to calibrate and test the responses of
the machine for specific inputs. These testing and calibration
operations include procedures such as calibration of the UDDS
system, calibration of the scanner for brightness, calibration of
the scanner's speed, and measurement of image quality.
5. Packaging
Once the end of line procedures are completed, the assembled
scanners are visually inspected and packaged for shipment.
Issue: Whether the assembled Kodak i600 line of scanners are
considered to be products of the United States for purposes of U.S.
Government procurement.
Law and Analysis: Pursuant to Subpart B of Part 177, 19 CFR
177.21 et seq., which implements Title III of the Trade Agreements
Act of 1979, as amended (19 U.S.C. 2511 et seq.), CBP issues country
of origin advisory rulings and final determinations on whether an
article is or would be a product of a designated country or
instrumentality for the purposes of granting waivers of certain
``Buy American'' restrictions in U.S. law or practice for products
offered for sale to the U.S. Government.
Under the rule of origin set forth under 19 U.S.C. 2518(4)(B):
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 determining whether the combining of parts or materials
constitutes a substantial transformation, the determinative issue is
the extent of operations performed and whether the parts lose their
identity and become an integral part of the new article. Belcrest
Linens v. United States, 573 F. Supp. 1149 (CIT 1983), aff'd, 741
F.2d 1368 (Fed. Cir. 1984). Assembly operations that are minimal or
simple, as opposed to complex or meaningful, will generally not
result in a substantial transformation. See, C.S.D. 80-111, C.S.D.
85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D. 90-51, and C.S.D. 90-97.
In C.S.D. 85-25, 19 Cust. Bull. 844 (1985), CBP held that for
purposes of the Generalized System of Preferences (``GSP''), the
assembly of a large number of fabricated components onto a printed
circuit board in a process involving a considerable amount of time
and skill resulted in a substantial transformation. In that case, in
excess of 50 discrete fabricated components (such as resistors,
capacitors, diodes, integrated circuits, sockets, and connectors)
were assembled.
CBP has held in a number of cases involving similar type
equipment that
[[Page 54566]]
complex and meaningful assembly operations involving a large number
of components will generally result in a substantial transformation.
For example, in Headquarters Ruling Letter (``HRL'') 562495 dated
November 13, 2002, color ink jet printers were assembled in
Singapore of components imported from a number of other countries.
CBP determined that the imported components were substantially
transformed during assembly such that the country of origin of the
assembled ink jet printers was Singapore. In support of this
position, CBP recognized that the processing operations that
occurred within Singapore were complex and extensive, required the
integration of 13 major subassemblies to the chassis, and that the
resulting product was a new and distinct article of commerce that
possessed a new name, character, and use.
In HRL 561734 dated March 22, 2001, published in the Federal
Register on March 29, 2001 (66 FR 17222), CBP held that certain
multi-functional machines (consisting of printer, copier, and fax
machines) assembled in Japan were a product of that country for
purposes of U.S. Government procurement. The multi-functional
machines were assembled from 227 parts (108 parts obtained from
Japan, 92 from Thailand, 3 from China, and 24 from other countries)
and eight subassemblies, each of which was assembled in Japan. One
of the subassemblies produced in Japan, referred to as the scanner
unit, was described as the ``heart of the machine.'' In finding that
the imported parts were substantially transformed in Japan, CBP
stated that the individual parts and components lost their separate
identities when they became part of the multi-functional machine.
See also, HRL 561568 dated March 22, 2001, published in the Federal
Register on March 29, 2001 (66 FR 17222).
By contrast, assembly operations that are minimal or simple will
generally not result in a substantial transformation. For example,
in HRL 734050 dated June 17, 1991, CBP held that Japanese-origin
components were not substantially transformed in China when
assembled in that country to form finished printers. The printers
consisted of five main components identified as the ``head'',
``mechanism'', ``circuit'', ``power source'', and ``outer case.''
The circuit, power source and outer case units were entirely
assembled or molded in Japan. The head and mechanical units were
made in Japan but exported to China in an unassembled state. All
five units were exported to China where the head and mechanical
units were assembled with screws and screwdrivers. Thereafter, the
head, mechanism, circuit, and power source units were mounted onto
the outer case with screws and screwdrivers. In holding that the
country of origin of the assembled printers was Japan, CBP
recognized that the vast majority of the printer's parts were of
Japanese origin and that the operations performed in China were
relatively simple assembly operations.
The programming operations performed in the instant case must
also be considered. In Data General Corporation v. United States, 4
CIT 182 (1982), the Court of International Trade held that a PROM
(programmable read-only memory) fabricated in a foreign country but
programmed in the United States for use in a computer circuit board
assembled abroad was substantially transformed. In Data General, the
court stated that the electronic pattern introduced into the circuit
by programming gave the PROM the function as a read only memory and
that the essence of the article, its pattern of interconnection or
stored memory, was established by programming.
As applied, we find that the various foreign-origin parts are
substantially transformed within the United States when assembled to
form the Kodak i600 line of scanners in the manner set forth above.
In making this determination we note that the scanners are comprised
of approximately 600 parts and thirteen subassemblies. Ten of the
subassemblies are assembled to completion within the United States
during a complex and meaningful process. Illustrative examples of
two major subassemblies built to completion in the United States are
the E-Box assembly (comprised of approximately 50 parts) and the pod
assembly (comprised of more than 180 parts). During the main build
phase of production, the various subassemblies and literally
hundreds of additional parts are assembled together to form the
scanners. Specialized fixtures, tooling, and other equipment are
used throughout assembly to align, test, and calibrate the scanners
as they are built. After assembly, the scanners are programmed with
firmware developed in the United States, which constitutes the
intelligence of the scanners. During such assembly and programming
operations, the individual components and subassemblies of foreign-
origin are subsumed into a new and distinct article of commerce that
has a new name, character, and use. Therefore, we find that the
country of origin of the Kodak i600 scanners for purposes of U.S.
Government procurement is the United States.
Holding: Based upon the specific facts of this case, we find
that the individual components and subassemblies imported into the
United States are substantially transformed when assembled in the
manner set forth above to form Kodak i600 desktop scanners.
Therefore, the country of origin of the Kodak i600 line of desktop
scanners for purposes of U.S. Government procurement is the United
States.
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. Any party-at-interest may, within
30 days after publication of the Federal Register notice referenced
above, seek judicial review of this final determination before the
Court of International Trade.
Sincerely,
Michael T. Schmitz,
Assistant Commissioner, Office of Regulations and Rulings.
[FR Doc. 05-18359 Filed 9-14-05; 8:45 am]
BILLING CODE 9110-06-P
