CLA-2-84:RR:NC:1:103 B82027
Ms. Midge A. Hand
International Castings and Equipment, Inc.
600 Houze Way, Suite E-8
Roswell, GA 30076
RE: The tariff classification and marking of winch components from China
Dear Ms. Hand:
In your letters dated Jan. 15, 1997 and Jan. 30, 1997 you requested a tariff classification and marking ruling.
You stated your firm imports three components of a winch. The three components, identified as the winch frame (part no. 3719), the intermediate gear (part no. 2890), and the winch drum (part no. 3723), are then resold by your firm to Choretime, Inc. At Choretime the winch frame and winch drum are drilled and/or tapped for threading, painted, and then assembled together with other components to form the finished winch. The other components which are assembled with the winch frame, intermediate gear, and winch drum are claimed to be of United States origin and basically consist of a shaft drum, input shaft assembly, pinion and bearing assembly, pawl, stud, pin, grease, washers, springs, rings, screws, and bearings. The winch in which these components are used is mounted to the ceiling of a poultry plant and, in conjunction with a cable, raises or lowers curtains or feeder lines from the floor of the poultry plant. Drawings of each of the three components were included with your inquiry.
The applicable subheading for the winch frame and winch drum will be 8431.10.0090, Harmonized Tariff Schedule of the United States (HTS), which provides for parts suitable for use solely or principally with winches of heading 8425: other. The rate of duty will be 0.8 percent ad valorem.
The applicable subheading for the intermediate gear will be 8483.40.9000, HTS, which provides for gears and gearing, other than toothed wheels, chain sprockets and other transmission elements entered separately. The rate of duty will be 2.5 percent ad valorem.
You also requested an exception from individual country of origin marking under Sec. 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), for the winch frame, intermediate gear, and winch drum provided the containers in which they are imported are properly marked. According to your letters, the value of the three imported components at the time of their sale to Choretime totals $26.40, while the value of the remaining parts is claimed to be $50.19. In addition, the combined weight of the imported components is 24 pounds, while the weight of the finished winch assembled by Choretime using the imported components is 37.25 pounds. Further, you stated the three components imported from China are exclusively used in the assembly of the completed winch, and are not individually used or resold. Based on this information, you claimed that Choretime is the ultimate purchaser of the winch frame, intermediate gear, and winch drum and thus an exception from the country of origin marking requirements is warranted for each of these articles.
19 U.S.C. 1304 provides that, unless excepted, every article of foreign origin imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or 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. Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.41(b), Customs Regulations (19 CFR 134.41(b)), mandates that the ultimate purchaser in the U.S. must be able to find the marking easily and read it without strain.
If imported articles are used in domestic manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported articles to a process which results in a substantial transformation of the articles. However, if the manufacturing process is a minor one which leaves the identity of the imported articles intact, the consumer or user of the article, who obtains the article after the processing, will be regarded as the ultimate purchaser. 19 CFR 134.1 (d) (1) and (2). For country of origin marking purposes, a substantial transformation occurs when articles lose their identity and become new articles having a new name, character, or use.
Review of the submitted drawings and parts list indicates that the imported components make up the major portion of the finished winch. The domestic components used in the assembly, while claimed to have a greater total value, appear to consist mostly of smaller components, many of which are of a general nature (e.g., screws, washers, rings). Also, we are of the opinion that the processing performed by Choretime, consisting of drilling/tapping of assembly holes, painting, and assembly does not substantially transform the imported articles. In this regard, we note that Choretime's parts listing refers to these articles by the same names as were used upon their importation, while simply indicating the winch frame and winch drum are "machined". In addition, the use of the imported components has not changed as a result of the processing and simple assembly operations performed in the U.S. and, except for the holes drilled/tapped into the winch frame and winch drum, the imported components retain their original shape and form. [See National Hand Tool Corp. v. United States, Slip Op. 92-61 (April 27, 1992)]
Accordingly, as no substantial transformation has occurred, Choretime is not the ultimate purchaser of the imported winch components. Assuming the winch frame, intermediate gear, and winch drum are not individually marked with their country of origin upon importation, but are imported in marked containers, the completed winch should be marked to indicate to its end user or purchaser the country of origin of the imported components.
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 Alan Horowitz at 212-466-5494.
Sincerely,
Robert B. Swierupski
Chief, Metals & Machinery Branch
National Commodity
Specialist Division