The country of origin of scissor lifts

N334276 August 11, 2023 OT:RR:NC:N1:103 CATEGORY: Origin Elizabeth Regard Polsinelli PC 1401 I (Eye) St. NWWashington, DC 20005 RE:  The country of origin of scissor lifts Dear Ms. Regard: In your letter dated July 27, 2023, you requested a country of origin ruling on behalf of your client, Sinoboom Poland Sp. z o.o. The merchandise under consideration is identified as electrically propelled scissor lifts with a hydraulic lifting platform.  We note the subject scissor lifts are identical to the model numbers described in NY ruling N324668, dated March 24, 2022. Since the source of particular parts are shifting for two major subassemblies, and vary for certain structural subassemblies, you have provided three scenarios for consideration. In the first scenario, both the arm subassembly and chassis subassembly are sourced from India. In the second scenario, the arm subassembly is sourced from Poland and the chassis subassembly is sourced from India. In the third scenario, the arm subassembly is sourced from India and the chassis subassembly is sourced from Poland. In all three scenarios, the platform assembly is produced in Poland, while the remaining components are sourced from China, Germany, Italy, Vietnam, and the Czech Republic. The production process begins with manufacturing the major structural subassemblies, including the arm subassembly and chassis assembly. Even though the entire production process for each subassembly will occur in either Poland or India, the processing steps will be the same regardless of origin. The metal components for the chassis subassembly and the arm subassembly are formed from steel through a machining process that involves sawing tubing, punching holes, lathing, laser cutting, pressing, drilling, tapping, bending, and more. Next, the metal components are fitted and assembled to form each subassembly, which includes laser cutting, deburring, bending, drilling, fitting, tack welding, finish welding, and coating. The subassemblies are then sent to Sinoboom Poland for final assembly. Final assembly occurs across multiple stations using approximately 21 components and subassemblies together with some smaller parts. It begins with routing wiring, installing the main controller, and installing the steering cylinder assembly to the chassis. This process is described as selecting the various components, followed by aligning, mounting, and securing them in place using various fasteners. The assembly continues with a worker aligning, fastening, and wiring the switches, bearing assembly, wheel frame assembly, and steering assemblies. At the next station, the pothole protection components and wheels are installed, using operational steps that are described as aligning, tightening bolts, inserting pins, and bolting. A worker then aligns, fixes, and installs the motor pump and the valve assembly. This is followed by installing the battery, charger, and other electrical components. The individual steps are described as aligning, mounting, routing wiring, and connecting various harnesses, cables, and plugs. The major tasks at the remaining stations include lubricating and bolting the counterweight, installing the platform assembly, connecting the lift valve assembly, wiring the motor, and routing various harnesses and hoses. With regard to your request for the appropriate country of origin of the scissor lifts, 19 C.F.R. § 134.1(b) provides in pertinent part as follows: Country of origin means 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. As stated in HQ 735009, dated July 30, 1993, “The country of origin is the country where the article last underwent a ‘substantial transformation,’ that is, processing which results in a change in the article's name, character, or use.” In addition, the court has held that “A substantial transformation occurs when an article emerges from a manufacturing process with a name, character, and use that differs from the original material subjected to the processing.” 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). In Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308 (2016), the Court of International Trade 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 that “when the end-use was pre-determined at the time of importation, courts have generally not found a change in use.” Energizer at 1319, citing as an example, National Hand Tool Corp. v. United States, 16 C.I.T. 308, 310, aff’d 989 F.2d 1201 (Fed. Cir. 1993). 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. The final assembly that occurs in Poland is not particularly complex. The operational steps consists largely of aligning, connecting, fastening, bolting, and tightening various subassemblies and components into position. As a result, we must consider the totality of the circumstances, including the country of origin of the item’s components, the extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, and use. The submitted description shows the processing is dominated by the three structural subassemblies (i.e., arm subassembly, chassis subassembly, and platform subassembly), which, in our view, also imparts each scissor lift with its essential character. In addition, the structural subassemblies are sent to Sinoboom Poland with an end-use that is pre-determined to be incorporated into a scissor lift and do not undergo a change in use. Under the first scenario, both the arm subassembly and chassis subassembly are produced in India. This includes the fabrication of the metal components and subsequent assembly into the respective subassemblies prior to export into Poland. As mentioned above, the platform structural subassembly is produced in Poland in all three scenarios. Because two of the three major structural subassemblies (i.e., arm and chassis subassemblies) are produced in India, the country of origin for marking purposes will be India. Under the second scenario, the arm subassembly is produced in Poland while the chassis subassembly is produced in India. Because two of the three major structural subassemblies (i.e., platform and arm subassemblies) are produced in Poland, the country of origin for marking purposes will be Poland. Under the third scenario, the arm subassembly is produced in India while the chassis subassembly is produced in Poland. Because two of the three major structural subassemblies (i.e., platform and chassis subassemblies) are produced in Poland, the country of origin for marking purposes will be Poland. Please note the merchandise in question may be subject to antidumping duties and countervailing duties (“AD/CVD”). Written decisions regarding the scope of AD/CVD orders are issued by the Enforcement and Compliance office in the International Trade Administration of the Department of Commerce and are separate from tariff classification and origin rulings issued by Customs and Border Protection (“CBP”). You can contact them at https://trade.gov/enforcement/ (click on “Contact Us”). For your information, you can view a list of current AD/CVD cases at the Department of Commerce ITA website at https://www.trade.gov/data-visualization/adcvd-proceedings, and you can search AD/CVD deposit and liquidation messages using CBP’s AD/CVD Search tool at https://aceservices.cbp.dhs.gov/adcvdweb. This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection Regulations (19 C.F.R. 177). 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 and Border Protection 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." 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 Paul Huang at paul.huang@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division