CLA-2-84:OT:RR:NC:N1:102
Matthew Fields
Autolin Inc.
16650 NE 79th St., Ste. 103 Redmond, WA 98052
RE: The classification and country of origin of a double flanged wheel hub assembly
Dear Mr. Fields:
In your letter dated October 14, 2024, you requested a country of origin ruling on a double flanged wheel hub assembly on behalf of New Torch Technology (Thailand) Company Limited. Technical information was provided with your submission.
The product under consideration is a double flanged wheel hub assembly with tapered bearings, without splining and anti-lock braking system (ABS) components (item number G3-842). The wheel hub assembly is a non-driven structure which cannot be used on the driving wheels of a vehicle. It primarily consists of an inner flange with bolts, inside seal ring, two sets of tapered roller bearings with cages, outer flange, inner ring, and outside seal ring. The raceways of the bearing are formed by the articulating surfaces of the inner flange, outer flange, and inner ring. It is within these raceways that the tapered roller bearings, held within cages, provide low friction rotation. The outer flange directly connects to the steering knuckle. The inner flange directly connects to the brake disc and attaches to the wheel rim by bolts.
In your letter, you suggest item number G3-842 is classified within subheading 8708.99.8115, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Parts and accessories of the motor vehicles of headings 8701 to 8705: Other parts and accessories: Other: Other: Other: Other: Other: Double flanged wheel hub units not incorporating ball bearings. We disagree.
Classification of merchandise under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs) 1 through 6. The systematic detail of the HTSUS is such that virtually all goods are classified by application of GRI 1, that is, according to the terms of the headings of the tariff schedule and any relevant section or chapter notes. Section Note 2(e) to Section XVII excludes “. . . articles of heading 8481 or 8482 . . .” from this Section. Since G3-842 functions as a bearing of heading 8482, HTSUS, and does not incorporate any other components that would exclude the article from this heading, classification of the wheel hub in heading 8708, HTSUS, is precluded.
Heading 8482, HTSUS, provides for Ball or roller bearings. In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes (ENs), although not dispositive nor legally binding, provide a commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989). The 8482 ENs clarify that the “heading covers all ball, roller, or needle roller type bearings . . . used in place of smooth metal bearings and enable friction to be considerably reduced.” Moreover, the ENs state that bearings normally “consist of two concentric rings (races) enclosing the balls or rollers, and a cage which keeps them in place and ensures their spacing remains constant.” Although item G3-842 attaches to vehicle components, it is clearly described by the terms of heading 8482 and confirmed by the ENs.
The applicable subheading for item number G3-842 will be 8482.20.0020, HTSUS, which provides for Ball or roller bearings, and parts thereof: Tapered roller bearings, including cone and tapered roller assemblies: Cup and cone assemblies entered as a set: Wheel hub units: Flanged. The rate of duty will be 5.8% ad valorem. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and accompanying duty rates are provided at https://hts.usitc.gov/.
Concerning country of origin, you state that the G3-842 will be assembled in Thailand from materials sourced from China and Thailand. Prior to final assembly, the inner and outer flanges of Thai origin and the inner ring of Chinese origin undergo various machining operations and processing in Thailand. The inner and outer flanges undergo fine turning, drilling, chamfering, tapping, heat treatment (quenching and tempering), grinding, and superfine grinding of the surfaces and raceways. The inner ring undergoes grinding and superfine grinding of the sidewall, inside and outside diameters, and raceways.
The final assembly, which occurs in Thailand, begins by demagnetizing and cleaning the components using an ultrasonic cleaner. A logo is laser marked onto the outer diameter of the inner flange or disc surface. Tapered rollers of Chinese origin are manually placed into two Chinese cages. Grease is applied. A Chinese inside seal ring is pressed onto the inner diameter of the outer flange using a booster and the inner flange bolts are press fit into the inner flange. Using a press-fitting machine, the inner and outer flanges and the caged rolling elements are combined, followed with the inner ring being pressed and locked into place. Clearance detection is conducted using a clearance detection machine. The upper end of the inner flange’s shaft diameter is rotated. Next, the Chinese outside seal ring is pressed into the inner diameter of the outer flange using a boost machine. Finally, the wheel hub assembly is manually inspected, painted with anti-rust oil, and packaged into a corrugated cardboard box.
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).
In the subject scenario, the country of origin of the wheel hub assembly is controlled by where the races with precision raceways are formed and finished into the articulating surfaces of the flanges and inner ring. This rationale is noted in HQ ruling 562528, dated December 10, 2002, which discusses the country of origin of a ball bearing. This ruling states that the fundamental character and use of the bearings is determined after the steel rings are ground and finished into races with precision raceways and they are no longer considered steel rings. This rational is also discussed in HQ rulings 731968, March 19, 1990, and 731969, dated March 19, 1990, where rings are heat treated and polished in one country and the races are created, and superfinishing occurs in the second country. In these rulings, the country of origin of the bearings was determined to be the country in which the rings become races with precision raceways.
In this case, the races with precision raceways are ground and finished into the articulating surfaces of the flanges and the inner ring in Thailand. Accordingly, the country of origin of the double flanged wheel hub assembly, item G3-842, for Section 301 Trade Remedy applicability is Thailand. Therefore, additional duties under the Section 301 Trade Remedy do not apply to the wheel hub assembly under consideration.
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 Paul Taylor at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division