---
kind: "section"
citation: "19 U.S.C. § 4033"
title: "19"
title_heading: "Customs Duties"
number: "4033"
heading: "Rules of origin"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/19/4033"
units:
  - "Chapter 26 — Dominican Republic-Central America Free Trade"
  - "Subchapter II — Customs Provisions"
---

# §4033. Rules of origin

- (a) **Application and interpretation—** In this section:
  - (1) **Tariff classification—** The basis for any tariff classification is the [HTS](/usc/19/4002.md?p=4).
  - (2) **Reference to 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](/usc/19/4002.md?p=4).
  - (3) **Cost or value—** 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](/usc/19/1677.md?p=3) in which the good is produced (whether the [United States](/usc/19/1683.md?p=9) or another [CAFTA–DR country](/usc/19/4002.md?p=2)).
- (b) **Originating goods—** For purposes of this chapter and for purposes of implementing the preferential tariff treatment provided for under the [Agreement](/usc/19/4002.md?p=1), except as otherwise provided in this section, a good is an originating good if—
  - (1) the good is a good wholly obtained or produced entirely in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2);
  - (2) the good—
    - (A) is produced entirely in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2), and—
      - (i) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1); or
      - (ii) the good otherwise satisfies any applicable regional value-content or other requirements specified in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1); and
    - (B) satisfies all other applicable requirements of this section; or
  - (3) the good is produced entirely in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2), exclusively from materials described in paragraph [(1)](#b-1) or [(2)](#b-2).
- (c) **Regional value-content—**
  - (1) **In general—** For purposes of [subsection (b)(2)](#b-2), the regional value-content of a good referred to in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1), except for goods to which [paragraph (4)](#c-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)](#c-2) or the build-up method described in [paragraph (3)](#c-3).
  - (2) **Build-down method—**
    - (A) **In general—** The regional value-content of a good may be calculated on the basis of the following build-down method:

      |  | rvc | = | av–vnm | × | 100 |  |
      | --- | --- | --- | --- | --- | --- | --- |
      | av |  |  |  |  |  |  |
      |  |  |  |  |  |  |  |

    - (B) **Definitions—** In [subparagraph (A)](#c-2-A):
      - (i) **RVC—** The term “RVC” means the regional value-content of the good, expressed as a percentage.
      - (ii) **AV—** The term “AV” means the adjusted value of the good.
      - (iii) **VNM—** 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.
  - (3) **Build-up method—**
    - (A) **In general—** The regional value-content of a good may be calculated on the basis of the following build-up method:

      |  | rvc | = | vom | × | 100 |  |
      | --- | --- | --- | --- | --- | --- | --- |
      | av |  |  |  |  |  |  |
      |  |  |  |  |  |  |  |

    - (B) **Definitions—** In [subparagraph (A)](#c-3-A):
      - (i) **RVC—** The term “RVC” means the regional value-content of the good, expressed as a percentage.
      - (ii) **AV—** The term “AV” means the adjusted value of the good.
      - (iii) **VOM—** 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.
  - (4) **Special rule for certain automotive goods—**
    - (A) **In general—** For purposes of [subsection (b)(2)](#b-2), the regional value-content of an automotive good referred to in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1) may be calculated by the importer, exporter, or producer of the good, on the basis of the following net cost method:

      |  | rvc | = | nc–vnm | × | 100 |  |
      | --- | --- | --- | --- | --- | --- | --- |
      | nc |  |  |  |  |  |  |
      |  |  |  |  |  |  |  |

    - (B) **Definitions—** In [subparagraph (A)](#c-4-A):
      - (i) **Automotive good—** 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.
      - (ii) **RVC—** The term “RVC” means the regional value-content of the automotive good, expressed as a percentage.
      - (iii) **NC—** The term “NC” means the net cost of the automotive good.
      - (iv) **VNM—** 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.
    - (C) **Motor vehicles—**
      - (i) **Basis of calculation—** For purposes of determining the regional value-content under [subparagraph (A)](#c-4-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)](#c-4-A), over the producer’s fiscal year—
        - (I) with respect to all motor vehicles in any 1 of the categories described in [clause (ii)](#c-4-C-ii); or
        - (II) with respect to all motor vehicles in any such category that are exported to the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2).
      - (ii) **Categories—** A category is described in this clause if it—
        - (I) is the same model line of motor vehicles, is in the same class of vehicles, and is produced in the same [plant](/usc/19/2575b.md?p=5) in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2), as the good described in [clause (i)](#c-4-C-i) for which regional value-content is being calculated;
        - (II) is the same class of motor vehicles, and is produced in the same [plant](/usc/19/2575b.md?p=5) in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2), as the good described in [clause (i)](#c-4-C-i) for which regional value-content is being calculated; or
        - (III) is the same model line of motor vehicles produced in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2) as the good described in [clause (i)](#c-4-C-i) for which regional value-content is being calculated.
    - (D) **Other automotive goods—** For purposes of determining the regional value-content under [subparagraph (A)](#c-4-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](/usc/19/2575b.md?p=5), an importer, exporter, or producer may—
      - (i) average the amounts calculated under the formula contained in [subparagraph (A)](#c-4-A) over—
        - (I) the fiscal year of the motor vehicle producer to whom the automotive goods are sold,
        - (II) any quarter or month, or
        - (III) its own fiscal year,

      if the goods were produced during the fiscal year, quarter, or month that is the basis for the calculation;

      - (ii) determine the average referred to in [clause (i)](#c-4-D-i) separately for such goods sold to 1 or more motor vehicle producers; or
      - (iii) make a separate determination under clause [(i)](#c-4-D-i) or [(ii)](#c-4-D-ii) for automotive goods that are exported to the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2).
    - (E) **Calculating net cost—** 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)](#c-4-B) by—
      - (i) calculating the total cost incurred with respect to all goods produced by the producer of the automotive good, subtracting any sales promotion, marketing and after-sales [service](/usc/19/2576b.md?p=4) costs, royalties, shipping and packing costs, and nonallowable interest costs that are included in the total cost of all such goods, and then reasonably allocating the resulting net cost of those goods to the automotive good;
      - (ii) calculating the total cost incurred with respect to all goods produced by that producer, reasonably allocating the total cost to the automotive good, and then subtracting any sales promotion, marketing and after-sales [service](/usc/19/2576b.md?p=4) costs, royalties, shipping and packing costs, and nonallowable interest costs that are included in the portion of the total cost allocated to the automotive good; or
      - (iii) reasonably allocating each cost that forms part of the total cost incurred with respect to the automotive good so that the aggregate of all such costs does not include any sales promotion, marketing and after-sales [service](/usc/19/2576b.md?p=4) costs, royalties, shipping and packing costs, or nonallowable interest costs.
- (d) **Value of materials—**
  - (1) **In general—** For the purpose of calculating the regional value-content of a good under [subsection (c)](#c), and for purposes of applying the de minimis rules under [subsection (f)](#f), the value of a material is—
    - (A) in the case of a material that is imported by the producer of the good, the adjusted value of the material;
    - (B) in the case of a material acquired in the territory in which the good is produced, the value, determined in accordance with Articles 1 through 8, Article 15, and the corresponding interpretive notes of the [Agreement](/usc/19/4002.md?p=1) on Implementation of Article VII of the General [Agreement](/usc/19/4002.md?p=1) on Tariffs and Trade 1994 referred to in [section 3511(d)(8) of this title](/usc/19/3511.md?p=d-8), as set forth in regulations promulgated by the [Secretary](/usc/19/1681.md?p=1) of the Treasury providing for the application of such Articles in the absence of an importation; or
    - (C) in the case of a material that is self-produced, the sum of—
      - (i) all expenses incurred in the production of the material, including general expenses; and
      - (ii) an amount for profit equivalent to the profit added in the normal course of trade.
  - (2) **Further adjustments to the value of materials—**
    - (A) **Originating material—** The following expenses, if not included in the value of an originating material calculated under [paragraph (1)](#d-1), may be added to the value of the originating material:
      - (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material within or between the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) to the location of the producer.
      - (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2), other than duties or taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable.
      - (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproducts.
    - (B) **Nonoriginating material—** The following expenses, if included in the value of a nonoriginating material calculated under [paragraph (1)](#d-1), may be deducted from the value of the nonoriginating material:
      - (i) The costs of freight, insurance, packing, and all other costs incurred in transporting the material within or between the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) to the location of the producer.
      - (ii) Duties, taxes, and customs brokerage fees on the material paid in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2), other than duties or taxes that are waived, refunded, refundable, or otherwise recoverable, including credit against duty or tax paid or payable.
      - (iii) The cost of waste and spoilage resulting from the use of the material in the production of the good, less the value of renewable scrap or byproducts.
      - (iv) The cost of originating materials used in the production of the nonoriginating material in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2).
- (e) **Accumulation—**
  - (1) **Originating materials used in production of goods of another country—** Originating materials from the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) that are used in the production of a good in the territory of another [CAFTA–DR country](/usc/19/4002.md?p=2) shall be considered to originate in the territory of that other [country](/usc/19/1677.md?p=3).
  - (2) **Multiple procedures—** A good that is produced in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) by 1 or more producers is an originating good if the good satisfies the requirements of [subsection (b)](#b) and all other applicable requirements of this section.
- (f) **De minimis amounts of nonoriginating materials—**
  - (1) **In general—** Except as provided in paragraphs [(2)](#f-2) and [(3)](#f-3), a good that does not undergo a change in tariff classification pursuant to Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1) is an originating good if—
    - (A) the value of all nonoriginating materials that—
      - (i) are used in the production of the good, and
      - (ii) do not undergo the applicable change in tariff classification (set out in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1)),

      does not exceed 10 percent of the adjusted value of the good;

    - (B) the good meets all other applicable requirements of this section; and
    - (C) the value of such nonoriginating materials is included in the value of nonoriginating materials for any applicable regional value-content requirement for the good.
  - (2) **Exceptions—** [Paragraph (1)](#f-1) does not apply to the following:
    - (A) A nonoriginating material provided for in [chapter 4](/usc/19/chch4.md), or a nonoriginating dairy preparation containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90, that is used in the production of a good provided for in chapter 4.
    - (B) A nonoriginating material provided for in [chapter 4](/usc/19/chch4.md), or a nonoriginating dairy preparation containing over 10 percent by weight of milk solids provided for in subheading 1901.90, that is used in the production of the following goods:
      - (i) Infant preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.10.
      - (ii) Mixes and doughs, containing over 25 percent by weight of butterfat, not put up for retail sale, provided for in subheading 1901.20.
      - (iii) Dairy preparations containing over 10 percent by weight of milk solids provided for in subheading 1901.90 or 2106.90.
      - (iv) Goods provided for in heading 2105.
      - (v) Beverages containing milk provided for in subheading 2202.90.
      - (vi) [Animal](/usc/19/2575b.md?p=1) feeds containing over 10 percent by weight of milk solids provided for in subheading 2309.90.
    - (C) A nonoriginating material provided for in heading 0805, or any of subheadings 2009.11 through 2009.39, that is used in the production of a good provided for in any of subheadings 2009.11 through 2009.39, or in fruit or vegetable juice of any single fruit or vegetable, fortified with minerals or vitamins, concentrated or unconcentrated, provided for in subheading 2106.90 or 2202.90.
    - (D) A nonoriginating material provided for in heading 0901 or 2101 that is used in the production of a good provided for in heading 0901 or 2101.
    - (E) A nonoriginating material provided for in heading 1006 that is used in the production of a good provided for in heading 1102 or 1103 or subheading 1904.90.
    - (F) A nonoriginating material provided for in [chapter 15](/usc/19/chch15.md) that is used in the production of a good provided for in chapter 15.
    - (G) A nonoriginating material provided for in heading 1701 that is used in the production of a good provided for in any of headings 1701 through 1703.
    - (H) A nonoriginating material provided for in [chapter 17](/usc/19/chch17.md) that is used in the production of a good provided for in subheading 1806.10.
    - (I) Except as provided in subparagraphs [(A)](#f-2-A) through [(H)](#f-2-H) and Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1), a nonoriginating material used in the production of a good provided for in any of chapters [1](/usc/19/chch1.md) through [24](/usc/19/chch24.md), unless the nonoriginating material is provided for in a different subheading than the good for which origin is being determined under this section.
  - (3) **Textile or apparel goods—**
    - (A) **In general—** Except as provided in [subparagraph (B)](#f-3-B), a [textile or apparel good](/usc/19/4002.md?p=5) 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](/usc/19/4002.md?p=1), shall be considered to be an originating good if—
      - (i) the total weight of all such fibers or yarns in that component is not more than 10 percent of the total weight of that component; or
      - (ii) the yarns are those described in [section 3203(b)(3)(B)(vi)(IV) of this title](/usc/19/3203.md?p=b-3-B-vi-IV) (as in effect on August 2, 2005).
    - (B) **Certain textile or apparel goods—** A [textile or apparel good](/usc/19/4002.md?p=5) 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](/usc/19/4002.md?p=2).
    - (C) **Yarn, fabric, or fiber—** 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.
- (g) **Fungible goods and materials—**
  - (1) **In general—**
    - (A) **Claim for preferential tariff treatment—** A [person](/usc/19/1683.md?p=8) 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.
    - (B) **Inventory management method—** In this subsection, the term “inventory management method” means—
      - (i) averaging;
      - (ii) “last-in, first-out”;
      - (iii) “first-in, first-out”; or
      - (iv) any other method—
        - (I) recognized in the generally accepted accounting principles of the [CAFTA–DR country](/usc/19/4002.md?p=2) in which the production is performed; or
        - (II) otherwise accepted by that [country](/usc/19/1677.md?p=3).
  - (2) **Election of inventory method—** A [person](/usc/19/1683.md?p=8) selecting an inventory management method under [paragraph (1)](#g-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](/usc/19/1683.md?p=8).
- (h) **Accessories, spare parts, or tools—**
  - (1) **In general—** Subject to paragraphs [(2)](#h-2) and [(3)](#h-3), accessories, spare parts, or tools delivered with a good that form part of the good’s [standard](/usc/19/2576b.md?p=5) accessories, spare parts, or tools shall—
    - (A) be treated as originating goods if the good is an originating good; and
    - (B) 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](/usc/19/4002.md?p=1).
  - (2) **Conditions—** [Paragraph (1)](#h-1) shall apply only if—
    - (A) the accessories, spare parts, or tools are classified with and not invoiced separately from the good, regardless of whether they appear specified or separately identified in the invoice for the good; and
    - (B) the quantities and value of the accessories, spare parts, or tools are customary for the good.
  - (3) **Regional value-content—** 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.
- (i) **Packaging materials and containers for retail sale—** 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](/usc/19/4002.md?p=1), 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.
- (j) **Packing materials and containers for shipment—** Packing materials and containers for shipment shall be disregarded in determining whether a good is an originating good.
- (k) **Indirect materials—** An indirect material shall be treated as an originating material without regard to where it is produced.
- (l) **Transit and transhipment—** A good that has undergone production necessary to qualify as an originating good under [subsection (b)](#b) shall not be considered to be an originating good if, subsequent to that production, the good—
  - (1) undergoes further production or any other operation outside the territories of the [CAFTA–DR countries](/usc/19/4002.md?p=2), other than unloading, reloading, or any other operation necessary to preserve the good in good condition or to transport the good to the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2); or
  - (2) does not remain under the control of customs authorities in the territory of a [country](/usc/19/1677.md?p=3) other than a [CAFTA–DR country](/usc/19/4002.md?p=2).
- (m) **Goods classifiable as goods put up in sets—** Notwithstanding the rules set forth in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1), goods classifiable as goods put up in sets for retail sale as provided for in General Rule of Interpretation 3 of the [HTS](/usc/19/4002.md?p=4) shall not be considered to be originating goods unless—
  - (1) each of the goods in the set is an originating good; or
  - (2) the total value of the nonoriginating goods in the set does not exceed—
    - (A) in the case of [textile or apparel goods](/usc/19/4002.md?p=5), 10 percent of the adjusted value of the set; or
    - (B) in the case of a good, other than a [textile or apparel good](/usc/19/4002.md?p=5), 15 percent of the adjusted value of the set.
- (n) **Definitions—** In this section:
  - (1) **Adjusted value—** 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](/usc/19/4002.md?p=1) on Implementation of Article VII of the General [Agreement](/usc/19/4002.md?p=1) on Tariffs and Trade 1994 referred to in [section 3511(d)(8) of this title](/usc/19/3511.md?p=d-8), adjusted, if necessary, to exclude any costs, charges, or expenses incurred for transportation, insurance, and related [services](/usc/19/2576b.md?p=4) incident to the international shipment of the merchandise from the country of exportation to the place of importation.
  - (2) **CAFTA–DR country—** The term “[CAFTA–DR country](/usc/19/4002.md?p=2)” means—
    - (A) the [United States](/usc/19/1683.md?p=9); and
    - (B) Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua, for such time as the [Agreement](/usc/19/4002.md?p=1) is in force between the [United States](/usc/19/1683.md?p=9) and that [country](/usc/19/1677.md?p=3).
  - (3) **Class of motor vehicles—** The term “class of motor vehicles” means any one of the following categories of motor vehicles:
    - (A) Motor vehicles provided for in subheading 8701.20, 8704.10, 8704.22, 8704.23, 8704.32, or 8704.90, or heading 8705 or 8706, or motor vehicles for the transport of 16 or more [persons](/usc/19/1683.md?p=8) provided for in subheading 8702.10 or 8702.90.
    - (B) Motor vehicles provided for in subheading 8701.10 or any of subheadings 8701.30 through 8701.90.
    - (C) Motor vehicles for the transport of 15 or fewer [persons](/usc/19/1683.md?p=8) provided for in subheading 8702.10 or 8702.90, or motor vehicles provided for in subheading 8704.21 or 8704.31.
    - (D) Motor vehicles provided for in any of subheadings 8703.21 through 8703.90.
  - (4) **Fungible good or fungible material—** 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.
  - (5) **Generally accepted accounting principles—** The term “generally accepted accounting principles” means the recognized consensus or substantial authoritative support in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2) 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](/usc/19/2576b.md?p=5), practices, and procedures.
  - (6) **Goods wholly obtained or produced entirely in the territory of one or more of the CAFTA–DR countries—** The term “goods wholly obtained or produced entirely in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2)” means—
    - (A) [plants](/usc/19/2575b.md?p=5) and [plant](/usc/19/2575b.md?p=5) products harvested or gathered in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2);
    - (B) live [animals](/usc/19/2575b.md?p=1) born and raised in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2);
    - (C) goods obtained in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) from live [animals](/usc/19/2575b.md?p=1);
    - (D) goods obtained from hunting, trapping, fishing or aquaculture conducted in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2);
    - (E) minerals and other natural resources not included in subparagraphs [(A)](#n-6-A) through [(D)](#n-6-D) that are extracted or taken in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2);
    - (F) fish, shellfish, and other marine life taken from the sea, seabed, or subsoil outside the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) by vessels registered or recorded with a [CAFTA–DR country](/usc/19/4002.md?p=2) and flying the flag of that [country](/usc/19/1677.md?p=3);
    - (G) goods produced on board factory ships from the goods referred to in [subparagraph (F)](#n-6-F), if such factory ships are registered or recorded with that [CAFTA–DR country](/usc/19/4002.md?p=2) and fly the flag of that [country](/usc/19/1677.md?p=3);
    - (H) goods taken by a [CAFTA–DR country](/usc/19/4002.md?p=2) or a [person](/usc/19/1683.md?p=8) of a [CAFTA–DR country](/usc/19/4002.md?p=2) from the seabed or subsoil outside territorial waters, if a [CAFTA–DR country](/usc/19/4002.md?p=2) has rights to exploit such seabed or subsoil;
    - (I) goods taken from outer space, if the goods are obtained by a [CAFTA–DR country](/usc/19/4002.md?p=2) or a [person](/usc/19/1683.md?p=8) of a [CAFTA–DR country](/usc/19/4002.md?p=2) and not processed in the territory of a [country](/usc/19/1677.md?p=3) other than a [CAFTA–DR country](/usc/19/4002.md?p=2);
    - (J) waste and scrap derived from—
      - (i) manufacturing or processing operations in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2); or
      - (ii) used goods collected in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2), if such goods are fit only for the recovery of raw materials;
    - (K) recovered goods derived in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) from used goods, and used in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2) in the production of remanufactured goods; and
    - (L) goods produced in the territory of one or more of the [CAFTA–DR countries](/usc/19/4002.md?p=2) exclusively from—
      - (i) goods referred to in any of subparagraphs [(A)](#n-6-A) through [(J)](#n-6-J), or
      - (ii) the derivatives of goods referred to in [clause (i)](#n-6-L-i),

      at any stage of production.

  - (7) **Identical goods—** The term “identical goods” means identical goods as defined in the [Agreement](/usc/19/4002.md?p=1) on Implementation of Article VII of the General [Agreement](/usc/19/4002.md?p=1) on Tariffs and Trade 1994 referred to in [section 3511(d)(8) of this title](/usc/19/3511.md?p=d-8);
  - (8) **Indirect material—** 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—
    - (A) fuel and energy;
    - (B) tools, dies, and molds;
    - (C) spare parts and materials used in the maintenance of equipment or buildings;
    - (D) lubricants, greases, compounding materials, and other materials used in production or used to operate equipment or buildings;
    - (E) gloves, glasses, footwear, clothing, safety equipment, and supplies;
    - (F) equipment, devices, and supplies used for testing or inspecting the good;
    - (G) catalysts and solvents; and
    - (H) any other goods that are not incorporated into the good but the use of which in the production of the good can reasonably be demonstrated to be a part of that production.
  - (9) **Material—** The term “material” means a good that is used in the production of another good, including a part or an ingredient.
  - (10) **Material that is self-produced—** 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.
  - (11) **Model line—** The term “model line” means a group of motor vehicles having the same platform or model name.
  - (12) **Net cost—** The term “net cost” means total cost minus sales promotion, marketing, and after-sales [service](/usc/19/2576b.md?p=4) costs, royalties, shipping and packing costs, and non-allowable interest costs that are included in the total cost.
  - (13) **Nonallowable interest costs—** 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](/usc/19/4002.md?p=2) in which the producer is located.
  - (14) **Nonoriginating good or nonoriginating material—** 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.
  - (15) **Packing materials and containers for shipment—** 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.
  - (16) **Preferential tariff treatment—** The term “preferential tariff treatment” means the customs duty rate, and the treatment under article 3.10.4 of the [Agreement](/usc/19/4002.md?p=1), that are applicable to an originating good pursuant to the [Agreement](/usc/19/4002.md?p=1).
  - (17) **Producer—** The term “producer” means a [person](/usc/19/1683.md?p=8) who engages in the production of a good in the territory of a [CAFTA–DR country](/usc/19/4002.md?p=2).
  - (18) **Production—** The term “production” means growing, mining, harvesting, fishing, raising, trapping, hunting, manufacturing, processing, assembling, or disassembling a good.
  - (19) **Reasonably allocate—** The term “reasonably allocate” means to apportion in a manner that would be appropriate under generally accepted accounting principles.
  - (20) **Recovered goods—** The term “recovered goods” means materials in the form of individual parts that are the result of—
    - (A) the disassembly of used goods into individual parts; and
    - (B) the cleaning, inspecting, testing, or other processing that is necessary for improvement to sound working condition of such individual parts.
  - (21) **Remanufactured good—** 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—
    - (A) is entirely or partially comprised of recovered goods; and
    - (B) has a similar life expectancy and enjoys a factory warranty similar to such a new good.
  - (22) **Total cost—** 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](/usc/19/4002.md?p=2).
  - (23) **Used—** The term “used” means used or consumed in the production of goods.
- (o) **Presidential proclamation authority—**
  - (1) **In general—** The President is authorized to proclaim, as part of the [HTS](/usc/19/4002.md?p=4)—
    - (A) the provisions set out in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1); and
    - (B) any additional subordinate category necessary to carry out this subchapter consistent with the [Agreement](/usc/19/4002.md?p=1).
  - (2) **Fabrics and yarns not available in commercial quantities in the United States—** The President is authorized to proclaim that a fabric or yarn is added to the list in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1) in an unrestricted quantity, as provided in article 3.25.4(e) of the [Agreement](/usc/19/4002.md?p=1).
  - (3) **Modifications—**
    - (A) **In general—** Subject to the consultation and layover provisions of [section 4014 of this title](/usc/19/4014.md), the President may proclaim modifications to the provisions proclaimed under the authority of [paragraph (1)(A)](#o-1-A), other than provisions of chapters 50 through 63, as included in Annex 4.1 of the [Agreement](/usc/19/4002.md?p=1).
    - (B) **Additional proclamations—** Notwithstanding [subparagraph (A)](#o-3-A), and subject to the consultation and layover provisions of [section 4014 of this title](/usc/19/4014.md), 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](/usc/19/4002.md?p=1).
  - (4) **Fabrics, yarns, or fibers not available in commercial quantities in the CAFTA–DR countries—**
    - (A) **In general—** Notwithstanding paragraph 3(A), the list of fabrics, yarns, and fibers set out in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1) may be modified as provided for in this paragraph.
    - (B) **Definitions—** In this paragraph:
      - (i) The term “interested entity” means the government of a [CAFTA–DR country](/usc/19/4002.md?p=2) other than the [United States](/usc/19/1683.md?p=9), a potential or actual purchaser of a [textile or apparel good](/usc/19/4002.md?p=5), or a potential or actual supplier of a [textile or apparel good](/usc/19/4002.md?p=5).
      - (ii) All references to “day” and “days” exclude Saturdays, Sundays, and legal holidays.
    - (C) **Requests to add fabrics, yarns, or fibers—**
      - (i) An interested entity may request the President to determine that a fabric, yarn, or fiber is not available in commercial quantities in a timely manner in the [CAFTA–DR countries](/usc/19/4002.md?p=2) and to add that fabric, yarn, or fiber to the list in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1) in a restricted or unrestricted quantity.
      - (ii) After receiving a request under [clause (i)](#o-4-C-i), the President may determine whether—
        - (I) the fabric, yarn, or fiber is available in commercial quantities in a timely manner in the [CAFTA–DR countries](/usc/19/4002.md?p=2); or
        - (II) any interested entity objects to the request.
      - (iii) The President may, within the time periods specified in [clause (iv)](#o-4-C-iv), proclaim that a fabric, yarn, or fiber that is the subject of a request submitted under [clause (i)](#o-4-C-i) is added to the list in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1) in an unrestricted quantity, or in any restricted quantity that the President may establish, if the President determines under [clause (ii)](#o-4-C-ii) that—
        - (I) the fabric, yarn, or fiber is not available in commercial quantities in a timely manner in the [CAFTA–DR countries](/usc/19/4002.md?p=2); or
        - (II) no interested entity has objected to the request.
      - (iv) The time periods within which the President may issue a proclamation under [clause (iii)](#o-4-C-iii) are—
        - (I) not later than 30 days after the date on which the request is submitted under [clause (i)](#o-4-C-i); or
        - (II) not later than 44 days after the request is submitted, if the President determines, within 30 days after the date on which the request is submitted, that the President does not have sufficient information to make a determination under [clause (ii)](#o-4-C-ii).
      - (v) Notwithstanding [section 4013(a)(2) of this title](/usc/19/4013.md?p=a-2), a proclamation made under [clause (iii)](#o-4-C-iii) shall take effect on the date on which the text of the proclamation is published in the Federal Register.
      - (vi) Not later than 6 months after proclaiming under [clause (iii)](#o-4-C-iii) that a fabric, yarn, or fiber is added to the list in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1) in a restricted quantity, the President may eliminate the restriction if the President determines that the fabric, yarn, or fiber is not available in commercial quantities in a timely manner in the [CAFTA–DR countries](/usc/19/4002.md?p=2).
    - (D) **Deemed approval of request—** If, after an interested entity submits a request under [subparagraph (C)(i)](#o-4-C-i), the President does not, within the applicable time period specified in [subparagraph (C)(iv)](#o-4-C-iv), make a determination under [subparagraph (C)(ii)](#o-4-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](/usc/19/4002.md?p=1) beginning—
      - (i) 45 days after the date on which the request was submitted; or
      - (ii) 60 days after the date on which the request was submitted, if the President made a determination under [subparagraph (C)(iv)(II)](#o-4-C-iv-II).
    - (E) **Requests to restrict or remove fabrics, yarns, or fibers—**
      - (i) Subject to [clause (ii)](#o-4-E-ii), an interested entity may request the President to restrict the quantity of, or remove from the list in Annex 3.25 of the [Agreement](/usc/19/4002.md?p=1), any fabric, yarn, or fiber—
        - (I) that has been added to that list in an unrestricted quantity pursuant to [paragraph (2)](#o-2) or subparagraph [(C)(iii)](#o-4-C-iii) or [(D)](#o-4-D); or
        - (II) with respect to which the President has eliminated a restriction under [subparagraph (C)(vi)](#o-4-C-vi).
      - (ii) An interested entity may submit a request under [clause (i)](#o-4-E-i) at any time beginning 6 months after the date of the action described in subclause [(I)](#o-4-E-i-I) or [(II)](#o-4-E-i-II) of that clause.
      - (iii) Not later than 30 days after the date on which a request under [clause (i)](#o-4-E-i) is submitted, the President may proclaim an action provided for under [clause (i)](#o-4-E-i) if the President determines that the fabric, yarn, or fiber that is the subject of the request is available in commercial quantities in a timely manner in the [CAFTA–DR countries](/usc/19/4002.md?p=2).
      - (iv) A proclamation declared under [clause (iii)](#o-4-E-iii) shall take effect no earlier than the date that is 6 months after the date on which the text of the proclamation is published in the Federal Register.
    - (F) **Procedures—** The President shall establish procedures—
      - (i) governing the submission of a request under subparagraphs [(C)](#o-4-C) and [(E)](#o-4-E); and
      - (ii) providing an opportunity for interested entities to submit comments and supporting evidence before the President makes a determination under subparagraph [(C)(ii)](#o-4-C-ii) or (vi) or [(E)(iii)](#o-4-E-iii).

## Source credit

(Pub. L. 109–53, title II, § 203, Aug. 2, 2005, 119 Stat. 469; Pub. L. 109–135, title IV, § 421, Dec. 21, 2005, 119 Stat. 2642.)

## Notes

### Termination of Section

For termination of section by section 107(d) of Pub. L. 109–53, see Effective and Termination Dates note below.

### Editorial Notes

### References in Text

This chapter, referred to in subsec. (b), was in the original “this Act”, meaning Pub. L. 109–53, Aug. 2, 2005, 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, Aug. 2, 2005, 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.

### Amendments

2005—Subsec. (c)(2)(A). Pub. L. 109–135, § 421(1), substituted


|  | “rvc | = | av–vnm | × | 100” |  |
| --- | --- | --- | --- | --- | --- | --- |
| av |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

for


|  | “rvc | = | av | × | 100”. |  |
| --- | --- | --- | --- | --- | --- | --- |
| av–vnm |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

Subsec. (c)(3)(A). Pub. L. 109–135, § 421(2), substituted


|  | “rvc | = | vom | × | 100” |  |
| --- | --- | --- | --- | --- | --- | --- |
| av |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

for


|  | “rvc | = | av | × | 100”. |  |
| --- | --- | --- | --- | --- | --- | --- |
| vom |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

Subsec. (c)(4)(A). Pub. L. 109–135, § 421(3), substituted


|  | “rvc | = | nc–vnm | × | 100” |  |
| --- | --- | --- | --- | --- | --- | --- |
| nc |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

for


|  | “rvc | = | nc | × | 100”. |  |
| --- | --- | --- | --- | --- | --- | --- |
| nc–vnm |  |  |  |  |  |  |
|  |  |  |  |  |  |  |

### Statutory Notes and Related Subsidiaries

### Effective and Termination Dates

Section 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 Functions

Proc. 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.