The country of origin of gas grills

N340363 June 18, 2024 OT:RR:NC:N4:410 CATEGORY: Origin James Pai BDO USA 600 Anton Boulevard, Suite 500Costa Mesa, CA 92626 RE:  The country of origin of gas grills Dear Mr. Pai: This is in response to your letter dated May 24, 2024, on behalf of your client Nexgrill Industries, Inc., requesting a country of origin determination of gas grills for purposes of Section 301 duties. The grills at issue are two propane gas griddles (grills) to be used for cooking food, which will be manufactured by almost identical operations/processes at a factory in either Indonesia or Malaysia. The gas grills each consist of a main lid, fire box, griddle plate or cooking area, gas train assembly, control panel, cooking area, side shelf, cart frame, and burners. You present a manufacturing process scenario, in which the factory in either Indonesia or Malaysia assembles the components of both Chinese origin and Indonesian/Malaysian origin to manufacture the gas grills, including the production of certain key sub-assemblies and the final assembly process occurred in Indonesia or Malaysia.  Main Lid Production The raw material (steel sheets) is purchased in China. The raw material is shipped to the Indonesia/Malaysian factory, where the sheets are transformed into the middle lid panel through forming, bending, and punching. The lid is then refined through sharp edge grinding. The Chinese-originating accessories (lid handle) are prepared to be staged for assembly onto the lid. The newly formed lid assembly will be prepped for powder coating, where the following process will take place: Various chemicals are mixed into a wet frit formulation. The lid is then placed in multiple separate chemical baths of the formulation for the purposes of degreasing, pickling, and rinsing. Afterwards, the lid is kiln dried, powder coating is sprayed to the lid sub-assembly. The lid is then placed on a conveyor system that feeds into a furnace and the lid is baked at 350 to 400 Fahrenheit for 15 to 20 minutes. The accessories are assembled onto the lid sub-assembly. The completed lid assembly is inspected and staged for pack out. Firebox Production The operation process of the fire boxes is similar to that in the above main lid production. Raw material (sheet steel) is purchased in China then shipped to Indonesia/Malaysia. The Indonesia/Malaysian factory processes the sheet steel into the firebox panels by forming, bending, and punching the raw material. The resulting firebox panels are transformed into the firebox panels through forming, bending, and punching. The firebox panels are then refined through sharp edge grinding. The firebox panels are combined through various welding operations to form a firebox assembly. The newly formed firebox assembly will be prepped for powder coating, where the following process will take place: Various chemicals are mixed into a wet frit formulation. The firebox is then placed in multiple separate chemical baths of the formulation for the purposes of degreasing, pickling, and rinsing. Afterwards, the firebox is kiln dried, powder coating is sprayed to firebox sub-assembly. The firebox is placed on a conveyor system that feeds into a furnace where the firebox is baked at 350 to 400 Fahrenheit for 15 to 20 minutes. The firebox is removed from the conveyor system for inspection. After the coating is inspected, the finished firebox is then sent to the pack out line. Griddle Plate/Cooking Area Chinese-originating steel plate is purchased in China where the material is prepared for formation into griddle plate, plate corners are cut and bent at all four sides to create the sides, plate corners are welded. The newly welded corners are grinded and polished. After the oil coating is added, the griddle plate is shipped to Indonesia / Malaysia for assembly in the finished griddle. Gas Train Assembly Production The Chinese-originating gas train assemblies (manifold tube, regulator hose, fittings, and gas valves) are purchased by the Chinese factory, in which the gas valve port holes are added to the manifold; the manifold is bent to shape and threaded connectors are added; gas valves are assembled onto the manifold and the regulatory gas tightness test is conducted. The manifold sub-assemblies are shipped to the Indonesia/Malaysian factory, where the gas manifold will be assembled onto an LP regulator sub-assembly, and the completed gas train assemblies get fire tested, per the required CSA regulatory testing requirements. Burners Production The raw material (perforated tube steel) is purchased in China, where the tubes are cut to size (approximately 18 inches), one end of the tube is pressed and sealed, the opposite end is pressed and sealed to create a venturi funnel, a fuel mixer screw is added to this end, the venturi funnel end has a breather hole punched into it and then it is welded in spider mesh, and a cap is welded onto the open end to finalize assembly of the burner. The burners are shipped to the Indonesia/Malaysia factory, where they will be installed into the fireboxes. The remaining components, such as the control panels, cart frames, side shelves, and cooking area, will be manufactured in China and then shipped to Indonesia/Malaysia. In Indonesia/Malaysia, the completed firebox sub-assemblies then get fire tested, per the required CSA regulatory testing requirements before being sent to the pack out line. The control panel, knobs, and gas train assembly are installed onto the fireboxes. The gas train assemblies will be installed onto the grills and then tested for gas tightness, proper ignition, and combustion. After meeting regulatory testing requirements, the remaining components will be attached/combined with screws, bolts, and nuts to be manufactured into the finished products. Workers will then install labels and clean the surfaces of the products. Finally, the subject merchandise will be packaged for retail sale. Internal packaging items are added within the grill. The grill will be placed in its retail box and warehoused before being shipped to the U.S. The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. 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 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 presented in the scenario the key components, i.e., the main lids and fireboxes are made in Indonesia/Malaysia from the material of sheet steel from China. The production of these key components from the Chinese sheet steel would constitute a substantial transformation in Malaysia then they are manufactured into subassemblies, which are ultimately assembled into the subject grills. The manufacturing process performed in Indonesia/Malaysia with respect to the grills does constitute a substantial transformation of the Chinse materials. The manufacturing process in Indonesia/Malaysia involves complex and skilled operations, which is more than a simple assembly. It creates a new and different article of commerce with a distinct character and use that is not inherent in the components imported into Indonesia/Malaysia. Thus, we find that the country of origin for the grills will be Indonesia/Malaysia. 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. Additionally, we note 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 Michael Chen at michael.w.chen@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division