The country of origin of positive temperature coefficient (PTC) fan heaters

N351504 August 15, 2025 OT:RR:NC:N4:410 CATEGORY: Country of Origin Nate Bolin K&L Gates LLP 1601 K Street, N.W. Washington, DC 20006 RE: The country of origin of positive temperature coefficient (PTC) fan heaters Dear Mr. Bolin: In your letter dated July 20, 2025, on behalf of your client Midea Consumer Electric (Vietnam) Co., Ltd. (“MVN”), you requested a country of origin determination ruling for wire fan heaters for the purposes of applying current trade remedies. The merchandise under consideration is identified as model numbers DR-HSH003/DR-HSH031 PTC fan heaters. The DR-HSH003/DR-HSH031 fan heaters are for household use and packaged individually in single, packaged units. The DR-HS heaters operate by using a PTC heating element to heat air passing over the PTC heating element. The fan blade in the DR-HS heaters then circulates the heated air to the room or other surrounding area where the DR-HS heaters are located. Except for the minor variations on the color, accessories and shape, all such units will use the same platform and share the same production process. You present the following manufacturing process scenario, in which the DR-HS heaters are produced in Vietnam through a manufacturing and assembly process comprising two main stages. The bill of materials (BOM) indicates that Vietnam accounts for the majority or a significant portion of the production costs of the DR-HS heaters. Manufacturing process details in Vietnam are outlined as follows: In the first stage, key components are manufactured in Vietnam from various raw materials. MVN and a third-party supplier will manufacture component parts of the DR-HS heaters in Vietnam from raw materials originating in China. The production of component parts are divided into two steps, as follows: (1) production of plastic parts from plastic raw materials; and (2) production of the PTC heating element. In step 1, MVN will manufacture the front and back shells, top cover, air duct, circuit board bracket, crank, display window, PTC bracket, bottom cover, oscillating supporter, and bottom housing for both the DR-HS heaters, the decorative ring and indicator bracket for the DR-HSH003 heater, and the control panel, rear cover and rear grille for the DR-HSH031 heater from raw materials via plastic injection molding. In step 2, the PTC heating element or PTC heater of the DR-HS heaters is manufactured by a third- party supplier of MVN in Vietnam from various raw materials. The production process in Vietnam specifically includes adhering the ceramic heating sheet and the thermal conductive strip together, electric curing the PTC heating element, adding connectors, and conducting multiple tests to confirm the product is functioning correctly. Next, in the second stage, MVN will place the body components, the PTC heating element, and the remaining components on the main assembly line to produce the finished DR-HS heaters. This final production process consists of manufacturing or assembling the components into sub-assemblies, then installing them into the finished products, inspection, testing, and packaging. When determining the country of origin for purposes of applying current trade remedies under Section 301, the substantial transformation analysis is applicable. See, e.g., Headquarters Ruling Letter (“HQ”) H301619, dated November 6, 2018. 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, 681 F.2d 778 (C.C.P.A. 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). This office reviewed the provided assembly process flow charts and other materials in the submission, and is of the opinion that the Chinese components undergo processing in Vietnam that is sufficiently complex and meaningful as to result in a substantial transformation, such that these components lose their individual identities and become an integral part of a new article, possessing a new name, character, and use. In addition, essential parts are manufactured in Vietnam. Accordingly, from the details submitted, we agree that the country of origin for the DR-HSH003/DR-HSH031 PTC fan heaters would be Vietnam. 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, (for) James Forkan Acting Director National Commodity Specialist Division