The country of origin of coiled steel wire nails and the applicability of certain trade remedies under Section 301

N333710 July 25, 2023 OT:RR:NC:N5:121 CATEGORY: Origin Heather Laverty Trust Air Cargo 2206 Lively BlvdElk Grove Village, IL 60007 RE:  The country of origin of coiled steel wire nails and the applicability of certain trade remedies under Section 301 Dear Ms. Laverty: In your letter dated June 27, 2023, you requested a country of origin ruling and a determination of the applicability of Section 301 trade remedies for coiled steel wire nails on behalf of D&J Fasteners, Inc. DBA SIG Industries. You state the coiled steel wire nails are made from raw steel wire that is purchased in China and then drawn through a series of dies and/or drawing plates to be reduced in diameter and elongated. That drawn wire is then shipped to Mexico for further processing. In Mexico, the wire is fed into a nail-making machine to be cut to the applicable lengths. The cut lengths are then fed into a nail-making die to shape the end of the nail into the head. On the other end of the wire, the point of the nail is sharpened through a process called pointing. The nails are polished to remove contaminants and residue, and then passed through another set of dies in a threading machine. Next, the nails are welded onto two thin copper wires to be secured into the desired position. A coating is applied to the nails for corrosion resistance and improving appearance, and then they are baked to dry. The line of welded nails goes through a rolling process that counts the nails and rolls it into the desired lengths. Lastly, quality control is conducted, and the items are packed for shipping to the United States. 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. 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 to render such other country the ‘country of origin' within the meaning of this part.  The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character, or 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).Based on the information provided, the operations performed in Mexico consist of cutting the wire into specific lengths, forming the head and point, polishing, threading, welding onto copper wires, coating, baking, rolling, counting, inspecting, and packing for shipping. This office finds that the processing operations performed in Mexico result in a new name, a new character, and a new use from that of the original wire. Processing the wire into coiled nails does effect a substantial transformation and gives us a new and different article of commerce. As such, the country of origin of the subject coiled steel wire nails will be Mexico. As the coiled steel wire nails are a product of Mexico, Section 301 duties are not applicable. 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. This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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 Jennifer Jameson at jennifer.d.jameson@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division