The country of origin of an inflator for the purpose of 301 Trade Remedies

N324601 March 29, 2022 CLA-2-84:OT:RR:NC:N1:102 CATEGORY: Origin William Maloney Sandler, Travis & Rosenberg, P.A. 675 Third Avenue New York, New York 10017 RE: The country of origin of an inflator for the purpose of 301 Trade Remedies Dear Mr. Maloney: In your letter dated March 2, 2022 you requested a country of origin ruling on behalf of your client, Stanley Black & Decker. Descriptive information was provided with your request. The product in question is referred to as a high-pressure inflator. The inflator, model number DCC020I, is described as a standing model and is designed to inflate air into various objects, including objects with a capacity to hold 160 pounds per square inch. The inflator can be powered by a 20-volt battery, a 12-volt adapter or a 120-volt alternating current. The inflator features a power button, an LED light button, a start/pause rotary knob, an LCD screen, and an outer top and bottom housing with a handle. The inflator is imported packaged with a wave hose, a high-pressure tapered nozzle, a Presta valve adapter and an inflator needle, ready for retail sale. With regard to country of origin, it is noted that a country of origin ruling regarding a similar scenario was issued for the subject model DCC020I, New York ruling (NYR) number N323054, dated December 23, 2021. As with the review completed in NYR N323054, the inflator is assembled in Vietnam from components that are produced in China and Vietnam. The primary changes in this request concern the origin of certain components, e.g., stator housing or stator core. The plastic outer housing (top and bottom housing), the HV end panel, right and left battery foot, motor pump bracket and door are molded in Vietnam. The inflator contains two electric motors; one motor powers an internal reciprocating pump (part number NA023849 550) and the other powers an internal blower (part number EZRS-380PM-12V). Both motors are produced using similar processes. The stator/rotor subassemblies for both motors are assembled in Vietnam from Chinese components as is the final electric motor assembly. The rotor assembly process in Vietnam consists of a Chinese commutator being pressed onto a Chinese rotor and then, the rotor with the commutator undergoes wire winding phases using Vietnamese wire. Afterwards, a copper hook is positioned and welded into place, which is followed by the application of insulating paint and encapsulating glue from Vietnam. The outer diameters of the commutator and rotor are then machined to certain specifications and a meson and baffled plate are inserted into the rotor. For the stator, an unmagnetized shoe from Vietnam and clamp spring are pressed into the stator housing, which is of Vietnamese origin, glued into position and cured. A bearing is then pressed into the Vietnamese stator housing and the stator is magnetized. Later, the rotor assembly is inserted into the magnetized stator assembly. Next, the middle plate assembly is pressed to the stator assembly with the rotor assembly, and the Chinese end housing is installed. Subsequently, the motor’s shaft is knurled. Each completed motor is subject to various tests and inspections throughout the assembly process. The fan and its respective motor are assembled to each other in Vietnam. A left fan housing, which is from China, is screwed to a blower motor, and afterwards, a Chinese fan is pressed onto the motor and housing subassembly. The right fan housing, which is from China, is then welded into place. The Vietnamese HV end panel is screwed to the motor bracket and the Chinese connecting pipe is manually attached. The fan housing is then screwed to the HV end panel. The Chinese piston pump cylinder, which is a pump, is also assembled to its corresponding motor and components in Vietnam. The process begins with a needle bearing and a sealing ring washer being pressed onto the piston lever. A valve sheet is screwed into place and a rubber ring is manually assembled onto the valve sheet. A shaft and a gear pin are then installed on the big gear. A bearing and big gear are pressed into the gear case. A Chinese fan and pinion are then pressed onto the shaft of the motor. The motor and fan are then screwed to the gear case. In sequence, the gear case cover is placed over the gear case, the piston lever is installed, the Chinese piston pump cylinder is manually installed, the cylinder cover is placed over the Chinese piston pump cylinder, and the air box is installed on the cylinder cover. The components are then screwed into place. Grease is applied as needed. The assembly process of the inflator continues in Vietnam with the HP end panel, which contains the fan and motor assembly, being affixed to the top housing. Afterwards, the pump and motor assembly is screwed to the motor pump bracket, which in turn is screwed to the top housing. Then, a Chinese PCBA with the soldered on LCD screen is positioned and screwed to the top housing. Next, the PCBA sensor is press-fitted onto a hose and then the motor pump bracket, which is installed and screwed to the top housing. Wiring is connected and welded into position. The start/pause rotary knob, which is of Chinese origin, is pressed into the top housing. Amongst these steps, the LED light button, and power button are installed. The top and bottom housings of the inflator are then screwed to each other, the right and left battery foots are screwed to each other, and the power cord and HP end-panel door are installed. Each completed inflator is tested, labeled, and packaged with Chinese accessories: a wave hose, a high-pressure tapered nozzle, a Presta valve adapter and an inflator needle. The “country of origin” is defined in 19 CFR 134.1(b), in pertinent part, 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.” For tariff purposes, 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). The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character and use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993). Further, in Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308 (2016), the Court of International Trade (“CIT”) interpreted the meaning of “substantial transformation” as used in the Trade Agreements Act of 1979 (“TAA”) for purposes of government procurement. In Energizer, the court reviewed the “name, character and use” test in determining whether a substantial transformation had occurred in determining the origin of a flashlight, and reviewed various court decisions involving substantial transformation determinations. The court noted, citing Uniroyal, Inc. v. United States, 3 C.I.T. 220, 226, 542 F. Supp. 1026, 1031, aff’d, 702 F.2d 1022 (Fed. Cir. 1983), that when “the post-importation processing consists of assembly, courts have been reluctant to find a change in character, particularly when the imported articles do not undergo a physical change.” Energizer at 1318. In addition, the court noted, “When the end-use was pre-determined at the time of importation, courts have generally not found a change in use.” Furthermore, courts have considered the nature of the assembly, i.e., whether it is a simple assembly or more complex, such that individual parts lose their separate identities and become integral parts of a new article. Here, components from Vietnam and China are joined or assembled to each other in Vietnam during the final assembly of the inflator. As described above, the assembly processes in Vietnam are not complex and do not result in a substantial transformation of the components, i.e., manually installing the Chinese piston pump cylinder onto the motor and the press-fitting of the Chinese fans onto their respective motors. In HQ rulings H303864, dated December 26, 2019, and H318255, dated November 3, 2021, CBP explains that the assembly operations to make pumps, such as the press-fitting of components, are regarded as being rather simple. It is our view that the origin of the inflator, for the purposes of Section 301 Trade Remedies, is determined by its essence, the motor of the pump.  In HQ H314638, CBP explained that the critical components of an electric motor are the stator and the rotor.  Whereas the stator in HQ H314638 was described as an arrangement of the stator core, frame, and windings, we note that the instant stator is simply a cup shaped stamped metal housing, and thus the stator described in HQ H314638 was a significantly more complex article by comparison.  Therefore, in our opinion, the rotor in the instant motor involves the more complex assembly and represents a more critical component in the overall function of the electric motor at issue. Based on the information provided, it is the opinion of this office that the assembly operations described do not substantially transform the individual Chinese-made parts as a result of the work completed in Vietnam.   In other words, the rotor core is not transformed by machine pressing a commutator onto the shaft and wrapping with copper wire; and the stator core is not transformed by gluing magnets and machine pressing a bearing into the end bell.  Furthermore, the rotor, the stator, the commutator, the shaft, etc. each have a predetermined end use prior to their importation into Vietnam.  As the assembly process of the various parts in Vietnam is not complex, the individual Chinese components are not substantially transformed and the assembled electric motor is considered a product of China.  See HQ H314638; HQ H303864; HQ H300226; NY N319464.  Accordingly, the the country of origin of the finished inflator, model number DCC020I, for the purpose of 301 Trade Remedies is China. As such, the inflator, model number DCC020I, is subject to Section 301 Trade Remedies. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request.  This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1).  This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect.  In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2.  You should also be aware that the material facts described in the foregoing ruling may be subject to periodic verification by CBP. 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 Sandra Martinez at Sandra.martinez@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division