19 U.S.C. § 4033
In this section:
The basis for any tariff classification is the HTS.
Whenever in this section there is a reference to a chapter, heading, or subheading, such reference shall be a reference to a chapter, heading, or subheading of the HTS.
Any cost or value referred to in this section shall be recorded and maintained in accordance with the generally accepted accounting principles applicable in the territory of the country in which the good is produced (whether the United States or another CAFTA-DR country).
For purposes of this chapter and for purposes of implementing the preferential tariff treatment provided for under the Agreement, except as otherwise provided in this section, a good is an originating good if-
For purposes of subsection (b)(2), the regional value-content of a good referred to in Annex 4.1 of the Agreement, except for goods to which paragraph (4) applies, shall be calculated by the importer, exporter, or producer of the good, on the basis of the build-down method described in paragraph (2) or the build-up method described in paragraph (3).
The regional value-content of a good may be calculated on the basis of the following build-down method:
| RVC | = | AV-VNM | x | 100 | ||
| AV | ||||||
In subparagraph (A):
The term "RVC" means the regional value-content of the good, expressed as a percentage.
The term "AV" means the adjusted value of the good.
The term "VNM" means the value of nonoriginating materials that are acquired and used by the producer in the production of the good, but does not include the value of a material that is self-produced.
The regional value-content of a good may be calculated on the basis of the following build-up method:
| RVC | = | VOM | x | 100 | ||
| AV | ||||||
In subparagraph (A):
The term "RVC" means the regional value-content of the good, expressed as a percentage.
The term "AV" means the adjusted value of the good.
The term "VOM" means the value of originating materials that are acquired or self-produced, and used by the producer in the production of the good.
For purposes of subsection (b)(2), the regional value-content of an automotive good referred to in Annex 4.1 of the Agreement may be calculated by the importer, exporter, or producer of the good, on the basis of the following net cost method:
| RVC | = | NC-VNM | x | 100 | ||
| NC | ||||||
In subparagraph (A):
The term "automotive good" means a good provided for in any of subheadings 8407.31 through 8407.34, subheading 8408.20, heading 8409, or in any of headings 8701 through 8708.
The term "RVC" means the regional value-content of the automotive good, expressed as a percentage.
The term "NC" means the net cost of the automotive good.
The term "VNM" means the value of nonoriginating materials that are acquired and used by the producer in the production of the automotive good, but does not include the value of a material that is self-produced.
For purposes of determining the regional value-content under subparagraph (A) for an automotive good that is a motor vehicle provided for in any of headings 8701 through 8705, an importer, exporter, or producer may average the amounts calculated under the formula contained in subparagraph (A), over the producer's fiscal year-
A category is described in this clause if it-
For purposes of determining the regional value-content under subparagraph (A) for automotive goods provided for in any of subheadings 8407.31 through 8407.34, in subheading 8408.20, or in heading 8409, 8706, 8707, or 8708, that are produced in the same plant, an importer, exporter, or producer may-
if the goods were produced during the fiscal year, quarter, or month that is the basis for the calculation;
The importer, exporter, or producer shall, consistent with the provisions regarding allocation of costs set out in generally accepted accounting principles, determine the net cost of an automotive good under subparagraph (B) by-
For the purpose of calculating the regional value-content of a good under subsection (c), and for purposes of applying the de minimis rules under subsection (f), the value of a material is-
The following expenses, if not included in the value of an originating material calculated under paragraph (1), may be added to the value of the originating material:
The following expenses, if included in the value of a nonoriginating material calculated under paragraph (1), may be deducted from the value of the nonoriginating material:
Originating materials from the territory of one or more of the CAFTA-DR countries that are used in the production of a good in the territory of another CAFTA-DR country shall be considered to originate in the territory of that other country.
A good that is produced in the territory of one or more of the CAFTA-DR countries by 1 or more producers is an originating good if the good satisfies the requirements of subsection (b) and all other applicable requirements of this section.
Except as provided in paragraphs (2) and (3), a good that does not undergo a change in tariff classification pursuant to Annex 4.1 of the Agreement is an originating good if-
does not exceed 10 percent of the adjusted value of the good;
Paragraph (1) does not apply to the following:
Except as provided in subparagraph (B), a textile or apparel good that is not an originating good because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification, set out in Annex 4.1 of the Agreement, shall be considered to be an originating good if-
A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of a CAFTA-DR country.
For purposes of this paragraph, in the case of a good that is a yarn, fabric, or fiber, the term "component of the good that determines the tariff classification of the good" means all of the fibers in the good.
A person claiming that a fungible good or fungible material is an originating good may base the claim either on the physical segregation of the fungible good or fungible material or by using an inventory management method with respect to the fungible good or fungible material.
In this subsection, the term "inventory management method" means-
A person selecting an inventory management method under paragraph (1) for a particular fungible good or fungible material shall continue to use that method for that fungible good or fungible material throughout the fiscal year of that person.
Subject to paragraphs (2) and (3), accessories, spare parts, or tools delivered with a good that form part of the good's standard accessories, spare parts, or tools shall-
Paragraph (1) shall apply only if-
If the good is subject to a regional value-content requirement, the value of the accessories, spare parts, or tools shall be taken into account as originating or nonoriginating materials, as the case may be, in calculating the regional value-content of the good.
Packaging materials and containers in which a good is packaged for retail sale, if classified with the good, shall be disregarded in determining whether all the nonoriginating materials used in the production of the good undergo the applicable change in tariff classification set out in Annex 4.1 of the Agreement, and, if the good is subject to a regional value-content requirement, the value of such packaging materials and containers shall be taken into account as originating or nonoriginating materials, as the case may be, in calculating the regional value-content of the good.
Packing materials and containers for shipment shall be disregarded in determining whether a good is an originating good.
An indirect material shall be treated as an originating material without regard to where it is produced.
A good that has undergone production necessary to qualify as an originating good under subsection (b) shall not be considered to be an originating good if, subsequent to that production, the good-
Notwithstanding the rules set forth in Annex 4.1 of the Agreement, goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the HTS shall not be considered to be originating goods unless-
In this section:
The term "adjusted value" means the value determined in accordance with Articles 1 through 8, Article 15, and the corresponding interpretive notes of the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 referred to in section 3511(d)(8) of this title, adjusted, if necessary, to exclude any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise from the country of exportation to the place of importation.
The term "CAFTA-DR country" means-
The term "class of motor vehicles" means any one of the following categories of motor vehicles:
The term "fungible good" or "fungible material" means a good or material, as the case may be, that is interchangeable with another good or material for commercial purposes and the properties of which are essentially identical to such other good or material.
The term "generally accepted accounting principles" means the recognized consensus or substantial authoritative support in the territory of a CAFTA-DR country with respect to the recording of revenues, expenses, costs, assets, and liabilities, the disclosure of information, and the preparation of financial statements. The principles may encompass broad guidelines of general application as well as detailed standards, practices, and procedures.
The term "goods wholly obtained or produced entirely in the territory of one or more of the CAFTA-DR countries" means-
at any stage of production.
The term "identical goods" means identical goods as defined in the Agreement on Implementation of Article VII of the General Agreement on Tariffs and Trade 1994 referred to in section 3511(d)(8) of this title;
The term "indirect material" means a good used in the production, testing, or inspection of a good but not physically incorporated into the good, or a good used in the maintenance of buildings or the operation of equipment associated with the production of a good, including-
The term "material" means a good that is used in the production of another good, including a part or an ingredient.
The term "material that is self-produced" means an originating material that is produced by a producer of a good and used in the production of that good.
The term "model line" means a group of motor vehicles having the same platform or model name.
The term "net cost" means total cost minus sales promotion, marketing, and after-sales service costs, royalties, shipping and packing costs, and non-allowable interest costs that are included in the total cost.
The term "nonallowable interest costs" means interest costs incurred by a producer that exceed 700 basis points above the applicable official interest rate for comparable maturities of the CAFTA-DR country in which the producer is located.
The terms "nonoriginating good" and "nonoriginating material" mean a good or material, as the case may be, that does not qualify as originating under this section.
The term "packing materials and containers for shipment" means the goods used to protect a good during its transportation and does not include the packaging materials and containers in which a good is packaged for retail sale.
The term "preferential tariff treatment" means the customs duty rate, and the treatment under article 3.10.4 of the Agreement, that are applicable to an originating good pursuant to the Agreement.
The term "producer" means a person who engages in the production of a good in the territory of a CAFTA-DR country.
The term "production" means growing, mining, harvesting, fishing, raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good.
The term "reasonably allocate" means to apportion in a manner that would be appropriate under generally accepted accounting principles.
The term "recovered goods" means materials in the form of individual parts that are the result of-
The term "remanufactured good" means a good that is classified under chapter 84, 85, or 87, or heading 9026, 9031, or 9032, other than a good classified under heading 8418 or 8516, and that-
The term "total cost" means all product costs, period costs, and other costs for a good incurred in the territory of one or more of the CAFTA-DR countries.
The term "used" means used or consumed in the production of goods.
The President is authorized to proclaim, as part of the HTS-
The President is authorized to proclaim that a fabric or yarn is added to the list in Annex 3.25 of the Agreement in an unrestricted quantity, as provided in article 3.25.4(e) of the Agreement.
Subject to the consultation and layover provisions of section 4014 of this title, the President may proclaim modifications to the provisions proclaimed under the authority of paragraph (1)(A), other than provisions of chapters 50 through 63, as included in Annex 4.1 of the Agreement.
Notwithstanding subparagraph (A), and subject to the consultation and layover provisions of section 4014 of this title, the President may proclaim before the end of the 1-year period beginning on August 2, 2005, modifications to correct any typographical, clerical, or other nonsubstantive technical error regarding the provisions of chapters 50 through 63, as included in Annex 4.1 of the Agreement.
Notwithstanding paragraph 3(A), the list of fabrics, yarns, and fibers set out in Annex 3.25 of the Agreement may be modified as provided for in this paragraph.
In this paragraph:
If, after an interested entity submits a request under subparagraph (C)(i), the President does not, within the applicable time period specified in subparagraph (C)(iv), make a determination under subparagraph (C)(ii) regarding the request, the fabric, yarn, or fiber that is the subject of the request shall be considered to be added, in an unrestricted quantity, to the list in Annex 3.25 of the Agreement beginning-
The President shall establish procedures-
19 U.S.C. § 4033
Termination of SectionFor termination of section by section 107(d) of Pub. L. 109-53 see Effective and Termination Dates note below.
EDITORIAL NOTES
REFERENCES IN TEXTThis chapter, referred to in subsec. (b), was in the original "this Act", meaning Pub. L. 109-53, 119 Stat. 462, which is classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 4001 of this title and Tables.This subchapter, referred to in subsec. (o)(1)(B), was in the original "this title" meaning title II of Pub. L. 109-53, 119 Stat. 462, which enacted this subchapter and amended sections 58c, 1508, 1514, 1520, and 1592 of this title. For complete classification of title II to the Code, see Tables.
AMENDMENTS2005-Subsec. (c)(2)(A). Pub. L. 109-135, §421(1), substituted
| "RVC | = | AV-VNM | x | 100" | ||
| AV | ||||||
| "RVC | = | AV | x | 100". | ||
| AV-VNM | ||||||
| "RVC | = | VOM | x | 100" | ||
| AV | ||||||
| "RVC | = | AV | x | 100". | ||
| VOM | ||||||
| "RVC | = | NC-VNM | x | 100" | ||
| NC | ||||||
| "RVC | = | NC | x | 100". | ||
| NC-VNM | ||||||
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE AND TERMINATION DATESSection effective on the date the Dominican Republic-Central America-United States Free Trade Agreement enters into force (Mar. 1, 2006) and to cease to have effect on the date the Agreement ceases to be in force with respect to the United States, and, during any period in which a country ceases to be a CAFTA-DR country, to cease to have effect with respect to such country, see section 107 of Pub. L. 109-53 set out as a note under section 4001 of this title.
EXECUTIVE DOCUMENTS
DELEGATION OF FUNCTIONSProc. No. 8213, Dec. 20, 2007, 72 F.R. 73556, provided in par. (4) that the Committee for the Implementation of Textile Agreements is authorized to exercise the President's authority under subsec. (o) of this section to implement Appendix 4.1-B of the Dominican Republic-Central America-United States Free Trade Agreement by determining whether and, if so, by what amount to increase, in accordance with paragraph 3 or footnote 2 of that Appendix, the quantitative limits in the provisions of the Harmonized Tariff Schedule set out in section D of the Annex to this proclamation (not set out in the Code).Proc. No. 7987, Feb. 28, 2006, 71 F.R. 10828, provided in par. (4) that the Committee for the Implementation of Textile Agreements is authorized to exercise the President's authority under subsec. (o) of this section to determine that a fabric, yarn, or fiber is not available in commercial quantities in a timely manner in the United States and those Dominican Republic-Central America-United States Free Trade Agreement countries for which the Agreement has entered into force, and to add any such fabric, yarn, or fiber to the list in Annex 3.25 of the Agreement in a restricted or unrestricted quantity; to eliminate a restriction on the quantity of a fabric, yarn, or fiber within 6 months after adding the fabric, yarn, or fiber to the list in Annex 3.25 of the Agreement in a restricted quantity; to restrict the quantity of, or remove from the list in Annex 3.25 of the Agreement, certain fabrics, yarns, or fibers; and to establish procedures governing the submission of a request for any such determination and to ensure appropriate public participation in any such determination.
- Agreement
- The term "Agreement" means the Dominican Republic-Central America-United States Free Trade Agreement approved by the Congress under section 4011(a)(1) of this title.
- HTS
- The term "HTS" means the Harmonized Tariff Schedule of the United States.
- textile or apparel good
- The term "textile or apparel good" means a good listed in the Annex to the Agreement on Textiles and Clothing referred to in section 3511(d)(4) of this title, other than a good listed in Annex 3.29 of the Agreement.