Page:United States Statutes at Large Volume 110 Part 4.djvu/963

 PUBLIC LAW 104-234—OCT. 2, 1996 110 STAT. 3059 mining the 35 percent requirement of subsection (a)(3), by virtue of having merely undergone— "(A) simple combining or packaging operations, or "(B) mere dilution with water or with another substance that does not materially alter the characteristics of the article or material. " (2) REQUIREMENTS FOR NEW OR DIFFERENT ARTICLE OF COMMERCE,—For purposes of subsection (a)(1), an article is a 'new or different article of commerce' if it is substantially transformed into an article having a new name, character, or use. "(3) COST OR VALUE OF MATERIALS. —(A) For purposes of this section, the cost or value of materials produced in the West Bank, the Gaza Strip, or a qualifying industrial zone includes— "(i) the manufacturer's actual cost for the materials; "(ii) when not included in the manufacturer's actual cost for the materials, the freight, insurance, packing, and all other costs incurred in transporting the materials to the manufacturer's plant; "(iii) the actual cost of waste or spoilage, less the value of recoverable scrap; and "(iv) taxes or duties imposed on the materials by the West Bank, the Gaza Strip, or a qualifying industrial zone, if such taxes or duties are not remitted on exportation. "(B) If a material is provided to the manufacturer without charge, or at less than fair market value, its cost or value shall be determined by computing the sum of— "(i) all expenses incurred in the growth, production, or manufacture of the material, including general expenses; "(ii) an amount for profit; and "(iii) freight, insurance, packing, and all other costs incurred in transporting the material to the manufacturer's plant. If the information necessary to compute the cost or value of a material is not available, the Customs Service may ascertain or estimate the value thereof using all reasonable methods. " (4) DIRECT COSTS OF PROCESSING OPERATIONS. —(A) For purposes of this section, the 'direct costs of processing operations performed in the West Bank, Gaza Strip, or a qualifying industrial zone' with respect to an article are those costs either directly incurred in, or which can be reasonably allocated to, the growth, production, manufacture, or assembly, of that article. Such costs include, but are not limited to, the following to the extent that they are includible in the appraised value of articles imported into the United States: "(i) All actual labor costs involved in the growth, production, manufacture, or assembly of the article, including fringe benefits, on-the-job training, and costs of engineering, supervisory, quality control, and similar personnel. "(ii) Dies, molds, tooling, and depreciation on machinery and equipment which are allocable to the article. "(iii) Research, development, design, engineering, and blueprint costs insofar as they are allocable to the article, "(iv) Costs of inspecting and testing the article.

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