OT:RR:NC:N5:121
Marva Washburn
Omni Trade Services, LLC.
3200 Olympus Blvd ,Suite 300 Dallas, TX 75019
RE: The country of origin of an electronic, keyless entry lock system
Dear Ms. Washburn:
In your letter dated February 6, 2025, you requested a country of origin ruling on the VingCard Signature Lock on behalf of Assa Abloy Global Solutions for the purposes of applying current trade remedies under Section 301.
The item under consideration is identified as the ASSA ABLOY VingCard Signature Lock. It is a high-security, electronic, keyless, mortise entry lock system that is commonly used in hotels and secure facilities. It is operated by radio frequency identification (RFID), keycard, or mobile apps via Bluetooth to verify access credentials. The system consists of an assembled lock case, a lock control unit (LCU), a lock case adapter (LCA), inside and outside door handles, a thumb turn, battery cover, a hardware pack, and various individual parts. The components are supplied together; however, the physical installation of the system takes place at the point of installation.
In your request, you outline a scenario in which approximately 109 separate components are shipped in bulk from China and other countries to Vietnam where they are assembled into various subassemblies that comprise the complete lock.
The lock case is assembled in Vietnam from approximately 38 components that are shipped in bulk from China and other countries to Vietnam. The lock case assembly and most of the components originate in China, and the dead bolt lever originates in Taiwan. In Vietnam the lock case is assembled in approximately 52 steps that include placing components on the lock case assembly, lubricating, mechanical screwing, pressing together, and ensuring proper alignment. Then the lock case goes through another approximately 12 steps of quality control, mechanical and electromechanical testing, and packaging. You state that this process takes approximately 7 minutes.
The inside and outside handle are both assembled in Vietnam from a handle wing, rose, retainer, and 4 other components from China. The handle wing, rose, washers, rings, and spring are assembled and pressed into place with a stamping machine. After checking the tightness of the handle, the retainer is pressed onto the assembly and the handle is packaged for shipping. This process takes approximately 16 steps and 46 seconds for each handle.
The thumb turn escutcheon assembly is assembled in Vietnam from an escutcheon, a thumb turn body, house, bushing, and a washer from China. The thumb turn body, house, and bushing are placed into a fixture and machine pressed together. Then the escutcheon and washer are added and pressed together with the first assembly. After assembly, the worker ensures the retaining ring is securely attached and that it can turn without assistance. This process takes approximately 9 steps and 2 minutes and 31 seconds.
The battery cover kit is assembled in Vietnam from the battery cover and 9 additional components from China.
Upon completion of the assembly process in Vietnam, the VingCard Signature lock is then paired with an LCU and an LCA. The LCA controls the physical locking mechanism, while the LCU manages the overall logic, security, and communication. Together they control the locking and unlocking mechanisms of the door. CBP Ruling N343964 determined that the LCU and LCA have a country of origin of Vietnam.
All the completed components are then packaged together and shipped to the United States.
You state that work performed in Vietnam involves multiple specialized steps including mechanical screwing, assembly of various internal components, and the integration of electromechanical systems the use of multiple fixtures, jigs, and the specialized training of assembly personnel, followed by a rigorous and complex testing process. You state each operator requires approximately 744 hours of training in product knowledge, assembling, equipment operation, test procedures, quality control, and troubleshooting so they can manufacture the 360 variations of the ASSA ABLOY VingCard Signature Lock assembly.
General Rule of Interpretation (GRI) 1, Harmonized Tariff Schedule of the United States (HTSUS), states in part that for legal purposes, classification shall be determined according to the terms of the headings, any relative section or chapter notes and, unless otherwise required, according to the remaining GRI's taken in order. Goods that are, prima facie, classifiable under two or more headings, are classifiable in accordance with GRI 3.
GRI 3 (a) states that the heading that provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings refer to only part of the items in a composite good or set, those headings are to be regarded as equally specific in relation to the goods, even if one of them gives a more complete or precise description of the good. As such, they are regarded as equally specific and classification of the composite good or set is to be determined by GRI 3(b) or GRI 3(c) taken in the appropriate order in which they are set out in GRI 3. GRI 3(b) states in part that composite goods or sets, which cannot be classified by reference to GRI 3(a), are to be classified as if they consisted of the component that gives them their essential character
The Explanatory Notes to the Harmonized Tariff System, although not legally binding, provide guidance in the interpretation of the Harmonized Commodity Description and Coding System at the international level. Explanatory Note X to GRI 3 (b) provides that the term "goods put up in sets for retail sale" means goods that: (a) consist of at least two different articles which are, prima facie, classifiable in different headings; (b) consist of articles put up together to meet a particular need or carry out a specific activity; and (c) are put up in a manner suitable for sale directly to users without re-packing. Goods classifiable under GRI 3 (b) are classified as if they consisted of the material or component which gives them their essential character, which may be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the article.
The VingCard Signature Lock assembly consists of two or more articles that are, prima facie, classifiable in different headings. The VingCard Signature Lock assembly also consists of articles put up together to carry out a specific activity (i.e., to lock and unlock a door). Finally, the articles are put up in a manner suitable for sale directly to users without repacking. Therefore, the VingCard Signature Lock assembly is described within the meaning of "goods put up in sets for retail sale."
In accordance with GRI 3 (b), which states in part that goods put up in sets for retail sale, that cannot be classified by reference to GRI 3 (a), are to be classified as if they consisted of the component which gives them their essential character. In our view, the article that provides the essential character of the VingCard Signature Lock assembly is the lock case.
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 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).
We find that the assembled lock case imparts the essential character of the ASSA ABLOY VingCard Signature Lock because it is the main body of the lock and contains the working parts that allow a lock to secure a door. It is our opinion that the assembled lock case's functionality was predetermined by the lock case assembly of Chinese origin, and it did not undergo a substantial change when additional parts of locks (also of Chinese origin) were assembled into the completed lock case in Vietnam. While the work performed in Vietnam requires more than 60 steps by trained operators, we find that it does not change the character of the Chinese lock case assembly.
Based upon the facts presented, it is the opinion of this office that the assembly process performed in Vietnam did not result in a substantial transformation of the lock case. The Chinese components of the lock case were not transformed in Vietnam into a new and different article of commerce with a name, character, and use which were distinct from the articles exported from China. The culmination of the other production processes performed in Vietnam does not substantially transform the lock case. Therefore, the subject ASSA ABLOY VingCard Signature Lock will be subject to the additional duties under Section 301 of the Trade Act of 1974, as amended, upon importation.
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 Jennifer Jameson at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division