KPMG report: “Country of origin” ruling affects U.S. importers

Importers in the United States must continue to carefully navigate numerous court decisions and customs rulings, which sometimes appear to be in conflict, when making “country of origin” determinations, particularly in the context of applying punitive tariffs on Chinese-origin goods, which are as high as 25%.

In one of its first rulings since the Court of International Trade’s (CIT’s) February 2023 opinion in Cyber Power Systems (USA) Inc. v. United States, Slip-Op. 23-24 (February 27, 2023) (read TradeNewsFlash), U.S. Customs and Border Protection (CBP) continues to place an emphasis on the “predetermined end-use” of components that are critical, or essential, to the functionality of the imported finished good to determine whether the good has substantially transformed in a particular country. 

Read a June 2023 report [PDF 321 KB] prepared by KPMG LLP: What’s News in Tax: CBP’s recent ruling concerning "country of origin" suggests the Energizer Battery decision has long lasting effects notwithstanding the Cyber Power Systems case
 

For more information, contact a professional with KPMG’s Trade & Customs services: