The country of origin of a pneumatic rotary valve actuator.

N322135 November 2, 2021 MAR-2:OT:RR:NC:N2:206 CATEGORY: Country of Origin Andrew Park Binex Line Corp 19515 S. Vermont Ave. Torrance, CA 90502 RE: The country of origin of a pneumatic rotary valve actuator. Dear Mr. Park: This is in response to your letter, dated October 10, 2021, requesting a ruling on the country of origin of a Pneumatic Rotary Valve Actuator for marking purposes and for purposes of applying trade remedies under Section 301 of the Trade Act of 1974, as amended, from China, which you filed on behalf of your client Sungdo Valve, Co., Ltd. The product under review is a Sung Do Rotary Actuator, which is a quarter turn pneumatic valve actuator with two rack and one pinion and scotch yoke structure. By using a special plastic bearing, it prevents metal to metal touch between the cylinder and piston, increases durability through lubrication, and is designed compactly to get a higher torque. Various sizes of actuators are manufactured so that wide output torque from 22 Newton-meters (N.M) to 4400N.M can be obtained in the 6-bar air pressure. You state that when air is provided to the center of the chamber through port "A" of the actuator, the piston rack rotates the pinion in the counterclockwise direction, and the valve opens, so that the remaining air in the chamber on each side is discharged through port "B". When air is provided through port "B", air pressure is added on each side of the cylinder, and the two pistons are pushed to the center. At this time, the remaining air of the center chamber is discharged through port "A". The piston rack moving into the center rotates the pinion clockwise, causing the valve to close. When a spring cartridge is added to the actuator and air is provided in the center chamber through port "A", the pistons compress the springs and are pushed in the outer direction, then the pinion is rotated counterclockwise, and the valve opens. When the provided air is discharged through port "A", the two pistons are pushed to the center, the pinion is rotated clockwise, and the valve closes. 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. 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).However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983) (Uniroyal). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987). In Uniroyal case, the court held that an upper was not substantially transformed when attached to an outsole to form a shoe and that the upper was "the very essence of the completed shoe". From the information provided, it appears that the majority of the components comprising the actuator are made in China and shipped to South Korea. In South Korea, the cylinder body and the pinion are machined and then assembled together with the rest of the Chinese and South Korean components. The assembly process in South Korea appears to be minor and does not result in substantial transformation. As a result, we need to determine the essence of the actuator. In ruling N308381, dated January 15, 2020, this office reviewed a similar actuator and determined that since the pinion causes the valve to open and close, it is the very essence of the actuator. You provided pictorial diagrams showing that the raw cylinder for the pinion is imported to South Korea. In South Korea, the teeth of the pinion are machined, and then the top and the bottom of it is machined to form the pinion. Although the raw cylindrical piece is made in China, the machining operations done in South Korea substantially transform the item into a new article, which is recognizable as a pinion. Therefore, the Sung Do Rotary Actuator is considered a product South Korea for marking purposes and for purposes of applying trade remedies under Section 301, of the Trade Act of 1974, as amended. Please note that 19 C.F.R. § 177.9(b)(1) provides that “[e]ach ruling letter is issued on the assumption that all of the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. The application of a ruling letter by a Customs Service field office to the transaction to which it is purported to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transaction described therein to the actual transaction, and the satisfaction of any conditions on which the ruling was based.” 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, please contact National Import Specialist Liana Alvarez at liana.alvarez@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division