FDA Country of Manufacture

Country of Origin & Country of Manufacture: CBP vs. FDA

When FDA regulated products are imported into the United States, information is required to be reported to the United States Customs and Border Protection (CBP) and the Food and Drug Administration (FDA). 

FDA regulated products include, but not limited to, foods, beverages, dietary supplements, drugs, medical devices, radiation-emitting electronic devices, and cosmetics. The country of origin of the imported products must be reported to both CBP and the FDA. 

Unfortunately, the country of origin for the purpose of the report to CBP and FDA can be different. This disagreement is because the FDA generally determines the country of origin based on the last country of manufacture, while CBP considers the country of origin to be the last country where processing resulted in a substantial transformation.

If the production operations occur in more than one country, Customs law requires the importer of record to determine a single country of origin based on where the product underwent last substantial transformation. In other words, the country of origin is where the last processing occurred to create a product with a new name, character or use.

In-Depth Coverage: Country of Origin

• Country of Origin of Imported Merchandise
• Customs Ruling: Country of Origin
• Country of Origin: Food Products
• Country of Origin: Chemical and Pharmaceutical Products
• Country of Origin & Country of Manufacture: CBP vs. FDA
• Country of Origin: Substantial Transformation or Country of Assembly Test
• Country of Origin and Free Trade Agreement
• Country of Origin and Section 301

Case Study 1:

Country of Origin of Frozen Precooked Tuna Loins Substantially Transformed in Country A and Lastly Manufactured in Country B.

The merchandise under consideration is Albacore tuna caught in Thailand from which the head, tail, fins, skin and guts will be removed. The fish is precooked by steaming, processed into loins then vacuum-sealed in bags with a net weight of 6.8 kilograms and frozen. The finished product was initially exported to the United States; however, it has been exported to Ecuador where the product was defrosted then repackaged into retort pouches with a net weight of 2.6 ounces and frozen. The frozen precooked tuna loins will be imported to the United States for retail sale to supermarkets.

Customs Regulations defines the country of origin as the country of manufacture, production or growth of any article of foreign origin entering the U.S.  Further work or material added to an article in another country must effect a substantial transformation in order to render such country the country of origin within the meaning of Part 134 of the regulations. A substantial transformation occurs when a new and different article of commerce emerges from a process with a new name, character or use different from that possessed by the article prior to processing (1). However, a substantial transformation will not result from a minor manufacturing or combining process that leaves the identity of the article intact (2).

CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. Factors such as the resources expended on product design and development, the extent and nature of post-assembly inspection and testing procedures, and worker skill required during the actual manufacturing process will be considered when determining whether a substantial transformation has occurred. No one factor is determinative.

In Koru North America (3), the court considered whether the processing of headed and gutted fish in South Korea by thawing, skinning, boning, trimming, freezing, and packaging as fillets constituted a substantial transformation. The court concluded that the processing performed in South Korea into “quick-frozen” fillets substantially transformed the headed fish because there was a change in name and character. The court noted that while the fish arrived in South Korea with the look of a whole fish when they left they no longer possessed the essential shape of a fish. The fillets were considered discrete commercial goods and had a different tariff classification.

In the case under consideration, Albacore tuna, which is harvested in Thailand, is stripped of the head, tail, fins, skin and guts. The fish is precooked by steaming, processed into loins, vacuum-sealed in 6.8-kilogram bags then frozen. The finished product was initially shipped to the United States before it was exported to Ecuador where it was defrosted and repackaged into 2.6-ounce retort pouches then frozen. The finished product will subsequently be shipped to the United States for retail sale.

In this case under consideration, CBP determines that the tuna has not been substantially transformed due to the processing in Ecuador and that therefore the country of origin of the frozen precooked tuna loins is Thailand.

However, the country of the last manufacture for the purpose of FDA report would be Ecuador where it was defrosted and repackaged into 2.6-ounce retort pouches then frozen before it was shipped to the United States.

For further information please refer to Customs Ruling―NY N306414

1. United States v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940).
2. National Juice Products Association v. United States, 628 F. Supp. 978 (Ct. Int’l Trade 1986).
3. Koru North America v. United States, 12 CIT 1120, 701 F. Suppl. 229 (C.I.T., 1988)

In-Depth Coverage: Importing Medical Device 

• Importing Medical Devices into the U.S.
• Medical Device Facility Registration and Device Listing
• Premarket Requirements for Imported Medical Devices
• Medical Device – Premarket Notification 510(k)
• Medical Device – Premarket Approval (PMA)
• Medical Device – Investigational Device Exemption (IDE)

Case Study 2:

Country of Origin of Strawberries Grown, Harvested, and Frozen in Morocco and Freeze-dried in China

The product under consideration is freeze-dried strawberries from Morocco. The strawberries are grown, harvested, and frozen in Morocco, then shipped to China where they are sorted, sliced or diced, freeze-dried, and repackaged in bulk poly bags and in boxes. After repackaging the strawberries are exported to the United States.

The freeze-drying process performed in China does not change the origin of the strawberries because the process in China does not result in a substantial transformation of the strawberries. In short, the process begins with strawberries and ends with strawberries. As a result, the strawberries will be considered a product of Morocco for the purpose of CBP report. However, the country of the last manufacture for the purpose of the FDA report would be China where they are sorted, sliced or diced, freeze-dried, and repackaged in bulk poly bags and in boxes.

For further information please refer to Customs Ruling―NY N306389

Case Study 3:

Country of Origin of Pre-cooked Rice Prepared in China from Rice Grown in Vietnam and Applicability of Section 301

The food product under consideration is pre-cooked long grain rice. The rice is grown in Vietnam and shipped to China for washing, boiling and packaging prior to importation into the United States.

In this case under consideration, the washing and boiling of the pre-cooked long grain rice in China does not constitute a substantial transformation. The country of origin of the pre-cooked long grain rice will be Vietnam. The long grain rice is excluded from the Section 301 additional rate of duty as it is not a product of China. However, the country of the last manufacture for the purpose of the FDA report would be China where the rice was washed, boiled and packaged prior to importation into the United States.

For further information please refer to Customs Ruling―NY N306050

In-Depth Coverage: Importing Food Products 

• What is FDA Food Safety Modernization Act (FSMA)? 
• Prior Notice of Imported Foods
• FDA Food Facility Registration
• Risk-Based Preventive Controls for Human Food
• Risk-Based Preventive Control for Animal Food
• Protect Food against Intentional Adulteration
• What is Foreign Supplier Verification Program (FSVP)?
• What is FSMA Produce Safety Rule?

Case Study 4:

Country of origin, and status under the United States – Korea Free Trade Agreement (UKFTA) of Frozen Tuna Loins.

The product under consideration is “Frozen Tuna Loins“ imported from Korea. Originally, the tuna is caught by a Chinese-flag vessel in Chinese ocean waters. Onboard the vessel, the heads, tails, gills and guts will be removed from the fish, which will then be frozen and exported to Korea. In Korea, fish will be processed into loins, frozen, vacuum packed individually and then exported to the United States.

• What is the country of origin of the “Frozen Tuna Loins“?
• Whether the imported “Frozen Tuna Loins“ are eligible for preferential tariff treatment under the United States – Korea Free Trade Agreement (UKFTA)?

Country of Origin

In Koru North America v. United States (1988), the court considered whether the processing of headed and gutted fish in South Korea by thawing, skinning, boning, trimming, freezing, and packaging constituted a substantial transformation. The court concluded that the processing performed in South Korea into “quick-frozen” fillets substantially transformed the headed fish because there was a change in name and character. The court noted that while the fish arrive in South Korea with the look of a whole fish when they leave they no longer possess theCountry of Origin essential shape of a fish. The fillets were considered discrete commercial goods and had a different tariff classification.

In the case under consideration, the tuna is caught by a Chinese-flag vessel in Chinese ocean waters. Onboard the vessel, the heads, tails, gills and guts will be removed from the fish, which will then be frozen and exported to Korea. In Korea, fish will be processed into loins, frozen, vacuum packed individually and then exported to the United States.

CBP found that the processing in Korea is a substantial transformation and that therefore the country of origin of the finished product, “Frozen Tuna Loins,” is Korea. The packages should be marked accordingly, e.g., “Product of Korea.” The country of origin or country of manufacture for the purpose of the FDA report is also Korea because the last manufacturing step occurred in Korea.

In-Depth Coverage: Customs Valuation

• What is the Price Actually Paid or Payable?
• What is an assist?
• What is the First Sale Rule?
• Rebates Subsequent to Importation
• Transaction Value for Related Party Transaction
• Buying and Selling Commissions in the Transaction Value
• Valuation of Merchandise Imported on Consignment

In-Depth Coverage: Trade Remedies

• What are Trade Remedies?
• Antidumping Duty (AD) and Countervailing Duty (CVD)
• Foreign Trade Zones and AD/CVD
• Section 301
• Section 201
• Section 232

Eligibility for Preferential Tariff Treatment under UKFTA

General Note 33, HTSUS, sets forth the criteria for determining whether a good is originating under the UKFTA. General Note 33(b), HTSUS, states that:

(b) For the purposes of this note, subject to the provisions of subdivisions (c), (d), (n) and (o) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good of a UKFTA country under the terms of this note if—

(i) the good is wholly obtained or produced entirely in the territory of Korea or of the United States, or both;    

(ii) the good is produced entirely in the territory of Korea or of the United States, or both, and       

(A) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (o) of this note; or    

(B) the good otherwise satisfies any applicable regional value content or other  requirements set forth in such subdivision (o); and satisfies all other applicable requirements of this note and of applicable regulations; or

(iii) the good is produced entirely in the territory of Korea or of the United States, or both, exclusively from materials described in subdivisions (i) or (ii), above.

For the purposes of this note, the term “UKFTA country” refers only to Korea or to the United States.

CBP finds that the merchandise imported into the United States does not qualify for preferential treatment under the UKFTA since none of the above requirements are met.

(1) Because the tuna is of Chinese origin, the product is not wholly obtained or produced entirely in the territory of Korea or of the United States, or both. Therefore, the subdivision (i) is inapplicable.  

(2) In Korea, the non-originating tuna loins from China undergo a tariff classification shift from heading 0303, HTSUS, to heading 0304, HTSUS, whereas the pertinent GN 33(o) rule requires a shift from another chapter of the tariff schedule. Therefore, the subdivision (i) is inapplicable. Consequently, the subdivision (iii) is inapplicable.  

For further information please refer to Customs Ruling―N306556

Addition Requirements for Importers of Food Product into the U.S.

The Bioterrorism Act – the Food and Drug Administration (FDA)

This food product is also subject to the Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act) and the Food Safety Modernization Act (FSMA), which is regulated by the Food and Drug Administration (FDA).

Under provisions of the U.S. law contained in the U.S. Federal Food, Drug and Cosmetic (FD&C) Act, importers of food products intended for introduction into U.S. interstate commerce are responsible for ensuring that the products are safe, sanitary, and labeled according to U.S. requirements. All imported food is considered to be interstate commerce.

Imported food products are subject to FDA inspection when offered for import at U.S. ports of entry. FDA may detain shipments of products offered for import if the shipments are found not to be in compliance with U.S. requirements. Both imported and domestically-produced foods must meet the same legal requirements in the United States.

In-Depth Coverage: USDA-Regulated Products

• Importing USDA-Regulated Food Products
• Import Regulation by USDA Agricultural Marketing Service (AMS)
• Food Products – FDA or USDA Regulated
• Country of Origin Labeling
• Importing Animals, Animal Products, and Biologics into the US
• Importing Meat, Poultry, and Egg Products into the US
• Labeling and Marking of Imported Meat, Poultry, and Egg Products
• USDA National Organic Program (NOP)
• Agricultural Safeguards and USDA Licensing

The FDA Food Safety Modernization Act (FSMA)

The FDA Food Safety Modernization Act (FSMA) require that facilities engaged in manufacturing, processing, packing, or holding food for consumption in the United States submit additional registration information to FDA, including an assurance that FDA will be permitted to inspect the facility at the times and in the manner permitted by the FD&C Act. It also requires food facilities required to register with FDA to renew such registrations every other year, and provides FDA with the authority to suspend the registration of a food facility in certain circumstances. Specifically, if FDA determines that food manufactured, processed, packed, received, or held by a registered food facility has a reasonable probability of causing serious adverse health consequences or death to humans or animals, FDA may by order suspend the registration of the facility.

Preventive controls for food facilities

Food facilities are required to implement a written preventive controls plan.  This involves: (1) evaluating the hazards that could affect food safety, (2) specifying what preventive steps, or controls, will be put in place to significantly minimize or prevent the hazards, (3) specifying how the facility will monitor these controls to ensure they are working, (4) maintaining routine records of the monitoring, and (5) specifying what actions the facility will take to correct problems that arise.  The written food safety plan required of food facilities must be prepared, or its preparation overseen, by one or more preventive controls qualified individuals. And the preventive controls qualified individual is charged with overseeing the validation that preventive controls are capable of controlling identified hazards and the records review.

Produce safety standards

FDA must establish science-based, minimum standards for the safe production and harvesting of fruits and vegetables.  Those standards must consider naturally occurring hazards, as well as those that may be introduced either unintentionally or intentionally, and must address soil amendments (materials added to the soil such as compost), hygiene, packaging, temperature controls, animals in the growing area and water. 

In-Depth Coverage: Marketing and Advertising Compliance

• Federal Trade Commission (FTC) Advertising Rules
• Made in USA Standard
• FTC Regulation on Environmental Claims
• Adverting and Marketing on the Internet
• Label Claims for Conventional Foods and Dietary Supplements
• Dietary Supplement Advertising: What is FTC's Truth-in-Advertising Law?
• USDA Country of Origin Labeling (COOL)
• FTC Rules & Regulations on Food Advertisement

Foreign Supplier Verification Programm (FSVP)

The FDA FSMA rule on Foreign Supplier Verification Programs (FSVP) for Importers of Food for Humans and Animals requires that FSVP importers perform certain risk-based activities to verify that food imported into the United States has been produced in a manner that meets applicable U.S. safety standards.

The FSVP importer is the U.S. owner or consignee of the food offered for import (i.e., owns the food, has purchased it, or has agreed in writing to purchase it at the time of U.S. entry). The key is that there be an FSVP importer in the United States who takes responsibility for meeting the FSVP requirements. FSVP importers subject to the FSVP regulation must ensure that their FSVP is developed and applied by a “qualified individual”.

Intentional Adulteration Rule (IA Rule) – Food Defense Plan

As part of the FDA Food Safety Modernization Act (FSMA), the FDA issued a final rule to require domestic and foreign food facilities, with some exceptions, to address hazards that may be introduced with the intention to cause wide-scale harm to public health.  These food facilities are required to identify significant vulnerabilities and take steps to minimize or prevent them. The rule does this by requiring that certain facilities develop and implement a food defense plan. 

The rule applies to the owner, operator or agent in charge of a domestic or foreign food facility that manufactures/processes, packs, or holds food for consumption in the United States and is required to register under section 415 of the Federal Food, Drug, and Cosmetic Act unless subject to an exemption (see 21 CFR 121.5).

The IA rule requires special qualifications for individuals who do or oversee the following activities (food defense qualified individual), which require the most food defense expertise:  preparation of the FDP; conduct of a vulnerability assessment; identification and explanation of mitigation strategies; and performance of the reanalysis.

Seafood Labeling Requirement – United State Department of Agriculture (USDA)

Seafood is subject to the Mandatory Country of Origin Labeling (COOL) requirements administered by the USDA’s Agricultural Marketing Service (AMS). COOL is a consumer labeling law that requires retailers (most grocery stores and supermarkets) to identify the country of origin on certain foods referred to as “covered commodities”. Covered commodity is defined in Customs Regulations 7 CFR Part 60—Country of origin labeling for fish and shellfish as:

• Farm-raised fish and shellfish (including fillets, steaks, nuggets, and any other flesh);
• Wild fish and shellfish (including fillets, steaks, nuggets, and any other flesh); 
• Covered commodities are excluded from this part if the commodity is an ingredient in a processed food item.

In-Depth Coverage: Importing Cosmetics

• Importing Cosmetics into the U.S.
• Cosmetics – Regulations and Enforcement by FDA
• Organic Cosmetic Products
• Shelf Life and Expiration Date of Cosmetics
• Cruelty-Free or Not Tested on Animals Labeling or Claims
• Cosmetics, Drugs, or Cosmetics and Drugs
• Voluntary Cosmetic Registration Program (VCRP)

Guidance on customs & logistics solution for traditional and e-commerce importers and exporters

Customs Clearance

All goods imported into the U.S. are required to be declared to CBP. Our customs broker will help you stay in compliance with customs laws and regulations and clear your goods quickly and efficiently with our electronic Automated Commercial Environment (ACE) and Automated Broker Interface (ABI) Single Window System.

Freight Forwarding

Looking for a freight forwarding partner?  To move your cargo from its current location through customs to its final destination we will partner with you to find the best way for your business. Whatever your transportation, logistics or customs clearance needs, we will do our best to customize a solution for your needs. 

Warehousing & Distribution

Our warehouse facility offers great potential for serving as a regional hub with over 145,000 SF storage capacity close to Los Angeles Airport & Los Angeles/Long Beach Sea port. With our extensive experience in freight services, your import/export cargo will be handled quickly and effectively.

E-Commerce

The Internet has made it easy to find and purchase items from almost anywhere in the world. Our e-commerce experts will help you find the right solution for your international transportation, customs clearance, and delivery to your final destination.  We also provide value-added repackaging, warehousing and distribution services. 

Section 321 Entry

Section 321 entry allows importing free of duty and tax for shipments imported by one person on one day having a fair retail value in the country of shipment not more than $800. We provide our resident and non-resident clients with dedicated ACE eManifest solutions for Section 321 entry of all modes of transportation. 

Customs Binding Ruling

Taking steps to ensure compliance is very important in order to avoid potential problems during the clearance process. The Customs binding ruling program enables importers to receive a binding ruling from CBP on the treatment of your goods when entering the U.S. 

Non-resident Importer Program

If you want to sell your products in U.S. marketplaces, but you are a business owner located outside of the U.S., and do not have an entity or physical presence in the U.S., you need to be established as a Foreign Importer of Record before your goods can be imported into the U.S. We can help you. 

Importer Security Filing (ISF)

An ISF is required when cargo (ocean only) laden on vessel at a foreign port is destined for shipment to the U.S.  Under ISF rule, some importing information and details regarding cargo must be transmitted to the CBP at least 24 hours before goods are loaded onto the vessel.

Customs Clearance and Import Requirements

• Entry of Imported Merchandise
• What is Section 321 Entry?
• What is Automated Commercial Environment (ACE)
• What is an Automated Broker Interface (ABI)?
• Who is Ultimate Consignee?
• What is Non-Resident Importer Program?
• Country of Origin of Imported Merchandise
• What is the Country of Assembly?
• What is the FDA's Country of Manufacture?
• Marking of Country of Origin on U.S. Imports
• What is Customs Bond?
• Reconciliation Prototype and Bond Rider
• Who Needs a Customs Broker?
• What is Customs Ruling Program?
• Classification of Imported Goods
• How is imported merchandise appraised?
• What are Import Quotas?
• What are Trade Remedy Duties?
• Antidumping Duty (AD) and Countervailing Duty (CVD)
• What is Foreign Trade Zone (FTZ)?
• What is Importer Security Filing (ISF)?
• What is Temporary Importation under Bond (TIB)
• What is In-Bond Process?

FDA-Regulated Products and Import Requirements

• What is Food Safety Modernization Act (FSMA)?
• Prior Notice of Imported Foods
• Food Facility Registration
• Risk-Based Preventive Controls for Human Food
• Risk-Based Preventive Control for Animal Food
• Standards for the Growing, Harvesting, Packing, and Holding of Produce for Human Consumption
• What is Foreign Supplier Verification Program (FSVP)?
• Protect Food against Intentional Adulteration
• FDA Regulated Product in Foreign Trade Zone (FTZ)
• Entry Review Process for FDA Regulated Products
• Country of Origin  VS  Country of Manufacture
• Foods Regulated by FDA or USDA: What is the Difference?
• Label and Labeling Claims for Conventional Food and Dietary Supplements
• What is USDA Country of Origin Labeling (COOL)?
• Import for Export of FDA Regulated Products
• FDA Regulated Products in Personal Baggage or Sending by Mail or Courier
• International Mail Facility (IMF) and FDA Regulation
• Importing Biological Product Regulated by CBER
• Importing Cosmetics and Voluntary Cosmetic Registration Program (VCRP)
• Importing Drugs into the U.S.
• Importing OTC Drugs into the U.S.
• Importing Veterinary Drugs into the U.S.
• Importing Tobacco Products into the U.S.
• Importing Medical Devices into the U.S
• Importing Food Products into he U.S.
• Importing Radiation-Emitting Products into the U.S.

Quick Link To U.S. Customs & Import Requirements