VNM

(4) Special rule for certain automotive goods (A) In general 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 × 100 nc (B) Definitions In subparagraph (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) 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— (I) with respect to all motor vehicles in any 1 of the categories described in clause (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. (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 in the territory of a CAFTA–DR country, as the good described in clause (i) for which regional value-content is being calculated; (II) is the same class of motor vehicles, and is produced in the same plant in the territory of a CAFTA–DR country, as the good described in clause (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 as the good described in clause (i) for which regional value-content is being calculated. (D) Other automotive goods 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— (i) average the amounts calculated under the formula contained in subparagraph (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) separately for such goods sold to 1 or more motor vehicle producers; or (iii) make a separate determination under clause (i) or (ii) for automotive goods that are exported to the territory of one or more of the CAFTA–DR countries. (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) 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 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 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 costs, royalties, shipping and packing costs, or nonallowable interest costs.

Source

19 USC § 4033(c)(4)


Scoping language

None identified, default scope is assumed to be the parent (subchapter II) of this section.
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