The country of origin of ovens

N318138 April 1, 2021 MAR-2 OT: RR: NC: N4:410 CATEGORY: Country of Origin Ms. Lauren Wyszomierski White & Case LLP 701 13th Street NW, Suite 600 Washington, DC 20005 RE: The country of origin of ovens Dear Ms. Wyszomierski: This is in response to your letter dated March 6, 2021, on behalf of your client Thai Toshiba Electric Industries Co., Ltd., requesting a country of origin determination for two ovens. The merchandise under consideration is two ovens identified as MGS30S2A and MGS30S4A (the ovens). The MGS30S2A ovens are 6.1cu.ft. capacity, 19,000 BTU/hr. bake burner power, 16,000 BTU/hr. broil burner power ovens that have 5 cooktop burners with 51,000 BTU burner power. The MGS30S4A ovens are 6.1cu.ft. capacity, 19,000 BTU/hr. bake burner power, 16,000 BTU/hr. broil burner power, 1000W Convection element ovens that have 5 cooktop burners with 57,000 BTU burner power. The MGS30S4A ovens have a griddle, while the MGS30S2A ovens do not have a griddle. Each oven unit is packaged for sale to individual consumers, together with its corresponding accessories. Depending on the model within the series, packaged accessories may include a user manual, installation manual, wire rack, and an extension rack. The models within the series vary slightly because they are sold into different markets with different color schemes, different accessories, or slightly different features. However, the models all use the same platform, with only one or two parts that may vary between models in the series. You present a manufacturing processing scenario for the country of origin determination of the ovens. Under the scenario, the products’ components and parts are produced in Thailand and sourced from China, Italy, United States and Mexico. The final processing occurs in Thailand. The MGS30S2A ovens contain 251 components and parts and the MGS30S4A ovens contain 270 components and parts. Approximately 27% and 23% (by unit cost) of the components and parts used to produce Model MGS30S2A and Model MGS30S4A, respectively, are sourced from Thailand. Other components, parts or sub-assemblies are imported from China, Italy, United States and Mexico. The production process in Thailand is described as follows: The production of the completed ovens in Thailand consists of both the production of several key components, such as the metal parts, PCB (printed circuit board) assembly, door assembly, cavity assembly, plastic bracket, and foam cushion, and the unit’s final assembly. The workers involved in the production of the ovens in Thailand include electrical engineers, electronics engineers, mechanical engineers, product engineers, test engineers and line workers who are specially trained to ensure the product’s quality and specifications. Production of Components and parts Parts and components productions Metal parts: Several finished and semi-finished metal parts are produced in the Thailand factory(ies) via stamping processes, bending processes, and degreasing processes. In general, each part involves the manipulation (stamping, bending, degreasing, inspection, packing, etc.) of sheet metal based on a template for the part at issue. For the stamping and bending processes, workers are required to obtain specific technical skills for machine/die work, associated safety protocols, and quality control. Over 50 parts and components are made in the stamping processes, which entail over 160 different steps. Surface cleaning of the stamped parts: requires a semi-automatic cleaning machine and a conveyer belt for loading the parts for the main assembly line. Degreasing each part entails 15 steps. Foam packaging: The products, including the Top, Base, Front, and Rear Cushions that are used to protect the products and accessories from damage during transport, are produced from expanded polystyrene (EPS) foam at foam injection shop. For each part, EPS foam is injected into a mold to form the part into the desired shape. The process involves over 10 processing steps. PCB assembly: includes surface mount technology (SMT) process, soldering and resoldering, circuit and function testing, program writing and inspection, etc., which entail 15 distinct process steps. Plastic Parts: The plastic parts, including the bracket supports that are used for affixing the PCB to the product, are produced at the plastic injection shop. For each part, plastic is injected into a mold to form the part into the desired shape. The overall plastic part injection process involves 7 steps including inspection and packing. The injection process includes 8 different sub-process, i.e., material feeding, melting, mold clamping, injecting, holding, mold open and ejecting. Product sub-assembly production Sub-assemblies are manufactured using parts and components made in Thailand and imported from China, Italy, United States and Mexico. These sub-assemblies include the base plate assembly, cavity assembly, cooling box assembly, cavity assembly, cooling box assembly, cover back assembly, door assembly, drawer assembly, cooling fan assembly and solenoid assembly. The process of manufacturing these sub-assemblies involves 63 different steps. Product final assembly Once built, the sub-assemblies are sent to the main assembly line for production of the finished oven according to the process below, which consists of 76 distinct steps, generally divided between (1) assembly/manufacture, (2) testing, and (3) packing. The assembly/manufacture takes 59 different steps. A series of successive quality control tests and inspections. The testing includes visual check, air leak test, electrical safety test, function test, appearance check, ignition needle check, knob check, valve check, fan check, and cooktop check, which going through over 50 distinct steps. Section 134.1(b), Customs Regulations (19 C.F.R. § 134.1(b)), defines "country of origin" as the country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the “country of origin”. In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. The country of origin of the item’s components, extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, and use are primary considerations in such cases. Additionally, 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. Based on the information submitted, the components and parts are imported into Thailand where they are manufactured into different subassemblies, which are ultimately assembled into the subject ovens. We find that the processing performed in Thailand with respect to the ovens in the scenario does constitute a substantial transformation of the imported components and parts into "products of" Thailand. The manufacturing process in Thailand transforms the non-originating components and parts to produce the finished ovens . It creates a new and different article of commerce with a distinct character and use that is not inherent in the components imported into Thailand. Therefore, the "product of" requirement has been satisfied. It is of the opinion of this office that the country of origin for the ovens will be Thailand. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR Part 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Michael Chen at michael.w.chen@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division