CLA-2-85:OT:RR:NC:N2:220
Robert Shapiro
Thompson Coburn LLP
1909 K Street, NW
Washington, DC 20816
RE: The country of origin of an electric motor
Dear Mr. Shapiro:
In your letter dated January 9, 2020 you requested a country of origin ruling on behalf of your client, Nidec Motor Corporation.
There are three electric motors under consideration, which are identified as the Evaporator Motor, 4/6P, the Evaporator Motor, 6/8P, and the Condenser Motor 4P. The subject motors have similar applications in commercial and consumer products, generally to turn a fan drawing air over condenser or evaporator coils. The motor components and subassemblies are similar for each motor and consist of the stator assembly, the rotor assembly, flanges, bearings, fasteners, and electrical connectors and insulators. The stator assembly is comprised of the wound stator core and the stator housing. The rotor assembly is comprised of the laminated stack, aluminum, and the flanges.
The wound stator core and rotor lamination stacks are said to be manufactured in China while the stator housing and flanges are sourced from France. In Hungary, you state the rotor lamination stack is injected with molten aluminum, a Hungarian origin shaft is inserted, and the rotor mass is machined and balanced. Once the rotor is fabricated, the construction of the motor in Hungary, which consists of 14 discreet steps, commences to include: inserting the stator core into the housing to form a stator assembly; attaching the flanges to the rotor to form a rotor assembly; inserting the rotor assembly into the stator assembly; making electrical connections; testing, painting, and packaging.
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; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin.”
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).
In order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. The country of origin of the item’s components, extent of the processing that occurs within a country, and whether such processing renders a product with a new name, character, and use are primary considerations in such cases. Additionally, factors such as the resources expended on product design and development, extent and nature of post-assembly inspection and testing procedures, and the degree of skill required during the actual manufacturing process may be relevant when determining whether a substantial transformation has occurred. No one factor is determinative.
With regard to the origin of the subject motors, we would note that the assembly operations performed by placing the rotor and stator assemblies into a housing to produce a functioning electric motor is not complex. Further, it is the opinion of this office that no single subassembly described herein is dispositive in determining the essence of a fully assembled electric motor because, in our view, the rotor assembly and the stator assembly merit consideration yet neither stands out predominantly over the other.
However, we do note that the production of the rotors and the assembly operation of the motors, irrespective of complexity, occurs in Hungary and constitutes the bulk of the work process as well as the majority of the manufacturing costs. As a result, we find that the Evaporator Motor, 4/6P, the Evaporator Motor, 6/8P, and the Condenser Motor 4P are considered products of Hungary for origin and marking purposes at the time of importation into the United States.
This ruling is being issued under the provisions of Part 177 of the Customs 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, contact National Import Specialist Karl Moosbrugger at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division