The country of origin of pipe restraints; Applicability of Section 301 Duties

N319235 May 27, 2021 CLA-2-73:OT:RR:NC:N1:113 CATEGORY: Country of Origin Ms. Jessica E. Lynd White & Case LLP 701 13th Street NW Washington, District of Columbia 20005 RE: The country of origin of pipe restraints; Applicability of Section 301 Duties Dear Ms. Lynd: In your letter dated May 3, 2021, on behalf of your client SIGMA Corporation, you requested a country of origin ruling. Pictures and descriptions of the subject pipe restraints were submitted for our review. The products under consideration are identified as two types of pipe restraints that include SIGMA’s SLDE Restraint and SIGMA’s SLCE Restraint. There are several variations within each type of restraint, and all of the restraints are similar in concept, construction and function. SIGMA’s SLDE Restraint works on ductile iron pipe and SIGMA’s SLCE Restraint works on polyvinyl chloride (PVC) pipe. The three main components that make up each pipe restraint are an annular ring referred to as a gland, wedges and jacking bolts. All of the components are made from ductile cast iron. Regarding the SLDE Restraint, you stated in your letter that “Referred to as a gland, the annular ring is slid over the plain end of a pipe that needs to be secured to a fitting. A rubber gasket is slid in behind the gland, and the plain end of the pipe is inserted into the bell mouth (opening) of the pipe fitting that needs connecting. Once this is done, the jacking bolts on the gland are tightened. When these jacking bolts are screwed into the gland, they force the wedges out of the pockets in the gland towards the pipe. Upon contact with the pipe surface, the sharp edges of the wedges bite forcefully into the surface of the pipe. This action firmly attaches the gland on the pipe, and the gland becomes like a flanged neck around the pipe circumference. The assembly is then completed by bolting the bolt holes on the flange of the fitting to the corresponding bolt holes on the flange in the gland by way of T head bolts. When these bolts are tightened, the assembly moves further into the opening of the fitting, and the SLDE squeezes the gasket into the bell mouth opening in the fitting to make a water-tight connection between a pipe and a fitting carrying water under pressure.” The SLCE Restraint operates in a similar fashion as the SLDE Restraint and the installation procedure on the pipe and fitting is similar. The difference is in the shape of the teeth on the wedges to enable a less aggressive bite on the PVC pipe surface since the PVC material is softer than the ductile iron. The teeth on the wedges are less sharp. For the same reason, the jacking bolts of the SLCE Restraint are also designed to exert less force on the wedges. The foundry in India that produces the SLDE Restraint and the SLCE Restraint manufactures the gland and purchases the wedges and the jacking bolts from a manufacturer in China. The Indian foundry manufactures the gland by casting and performing the finishing operations on the gland including machining and painting. The Indian foundry then assembles the restraint by inserting the wedges inside the pockets within the gland, screwing in the jacking bolts, and securing the entire assembly with rubber grommets. The SLDE Restraint and the SLCE Restraint are then exported to the United States. The only material differences between the variations are the sizes. The “country of origin” is defined in 19 CFR 134.1(b) 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' within the meaning of this part.” Please be advised when determining the country of origin for purposes of applying current trade remedies under Section 301, the substantial transformation analysis is applicable. See HQ H301619 (Nov. 6, 2018); see also HQ 563205 (June 28, 2006); and Belcrest Linens v. United States, 741 F.2d 1368, 1370-71 (Fed. Cir. 1984) (stating that “the term ‘product of’ at the least includes manufactured articles of such country or area” and that substantial transformation “is essentially the test used…in determining whether an article is a manufacture of a given country”). The courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982). With regard to the pipe restraints at issue, the gland which is produced in India, and the wedges and jacking bolts that are exported from China to India are further processed at the foundry in India by inserting the wedges inside the pockets within the gland, screwing in the jacking bolts, and securing the entire assembly with rubber grommets. In the opinion of our office, the operations performed on the glands, wedges and jacking bolts in India constitute a substantial transformation because the resulting product is a new or different article of commerce in which the name changed from gland, wedges and jacking bolts to pipe restraints. The manufacturing processes performed in India result in an article which has a new name, character and use. Therefore, in the opinion of our office, the country of origin of SIGMA’s SLDE Restraint and SIGMA’s SLCE Restraint is India, the country in which the pipe restraints are produced. Please note that the pipe restraints in question, when made in India, will not be subject to the Section 301 Trade Remedy. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 Ann Taub at ann.taub@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division