Is This the End of Predetermined End Use?
The Court of International Trade today issued a decision in the closely-watched CyberPower country of origin case. I have had high hopes that this case will be the vehicle to clarify the substantial transformation test used by Customs and Border Protection and the Courts to determine country of origin for purposes of marking and of assessing non-preferential duties (including Section 301 duties on goods originating in China). As discussed below, the language in the decision is generally favorable for a simplified and more reasonable approach to origin. But, the Court found open questions of fact and ordered the parties to prepare for a trial. The issue is the country of origin for Section 301 purposes of power supplies. The plaintiff had moved assembly from China to the Philippines, but retained many significant parts from China including a populated printed circuit board assembly. U.S. Customs found the item to originate in China and be subject to the 301 duties. Both parties mov