OT:RR:CTF:VS H347415 AP
Lawrence M. Friedman, Partner
Barnes, Richardson & Colburn, LLP
303 East Wacker Drive, Suite 305
Chicago, IL 60601
RE: Unassembled Latch Assemblies; Country of Origin; Section 301 and IEEPA Duties
Dear Mr. Friedman:
This is in response to your March 7, 2025 ruling request, filed on behalf of D&D
Technologies (“importer”), regarding the country of origin of two unassembled latch assemblies
(“latches”) of subheading 8302.49.60, Harmonized Tariff Schedule of the United States
(“HTSUS”), for purposes of Section 301 and International Emergency Economic Powers Act
(“IEEPA”) duties.
FACTS:
The first latch assembly is a q-bolt latch (“q-latch”). It includes a plastic housing (two
narrow brackets), bag, stickers and instructions made in Australia; steel screws manufactured in
Taiwan; and a steel q-bolt from China. The q-bolt is a 24-inch stainless-steel unthreaded rod that
is chamfered on both ends and bent into an almost complete U-shape on one of the ends. The
steel q-bolt holds the gate closed and is the most expensive component of the assembly.
The second latch assembly is a toggle latch (“t-latch”), which includes a plastic housing
(cover, backing plate, and catch), bag, stickers and instructions from Australia; steel screws from
Taiwan; and a steel t-bolt pin from China. The t-bolt pin consists of two pieces of unthreaded
metal rod that are pressed together to form a t-shape. The steel t-bolt pin is the most expensive
component in the assembly. Once assembled, usually to a gate, the t-bolt pin holds the gate
closed.
All components needed to form a complete t-latch assembly and a complete q-latch
assembly will be packed together but kept unassembled in Australia for shipment to the United
States. After importation into the United States, the t-latch and q-latch assemblies will be sold
unassembled for home assembly by U.S. purchasers who will assemble and install the latches.
The importer believes that the country of origin for the latch assemblies is Australia or in
the alternative, the latch components are products of Australia and China with Section 301 and
IEEPA duties applicable only to the Chinese components of the latches. The importer states that
the steel q-bolt and steel t-bolt pin are the component that imparts the essence to the complete
latches because they secure the gate when closed and provide the latches their functionality.
ISSUE:
What are the countries of origin of the complete unassembled q-latch and t-latch
assemblies for purposes of Section 301 and IEEPA duties?
LAW AND ANALYSIS:
The United States Trade Representative (“USTR”) has determined that an additional ad
valorem duty will be imposed on certain Chinese imports pursuant to USTR’s authority under
Section 301(b) of the Trade Act of 1974 (“Section 301 measures”). The Section 301 measures
apply to products of China enumerated in Section XXII, Chapter 99, Subchapter III, U.S.
Note 20(f), HTSUS. Among the subheadings listed in U.S. Note 20(f) is 8302.49.60, HTSUS.
In addition, effective March 4, 2025, pursuant to U.S. Note 2(u) to Subchapter III,
Chapter 99, all products of China and Hong Kong as provided by heading 9903.01.24, HTSUS,
other than products classifiable under headings 9903.01.21, 9903.01.22, and 9903.01.23,
HTSUS, will be subject to an additional duty. At the time of entry, the importer must report the
applicable Chapter 99 heading, i.e. 9903.01.24, in addition to subheading 8302.49.60, HTSUS,
listed above.
Further, effective April 5, 2025, Executive Orders implemented “Reciprocal Tariffs.” All
imported merchandise must be reported with either the Chapter 99 provision under which the
reciprocal tariff applies or one of the Chapter 99 provisions covering exceptions to the reciprocal
tariffs. Products from countries other than China will be subject to an additional duty. At the
time of entry, the Chapter 99 heading applicable to the article’s classification must be reported,
i.e. 9903.01.25, in addition to subheading 8302.49.60, HTSUS, listed above.
A substantial transformation occurs when an article emerges from a manufacturing
process with a name, character, or use, which differs from the original material subjected to the
process. In Nat’l Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F.2d 1201
(Fed. Cir. 1993), the court determined that hand tool components, which were cold-formed and
hot-forged in Taiwan into their final shape, with post-importation processing such as heat
treatment and electroplating, and assembly occurring in the United States, did not undergo
substantial transformation in the United States. There was no change in name because each
article as imported had the same name in the completed tool. There was no change in character
because the articles remained the same after heat treatment, electroplating, and assembly in the
United States. The use of the imported articles was predetermined at the time of entry – each
component was intended to be incorporated in a particular finished mechanics’ hand tool, except
for one exhibit with a dual use.
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In order to determine whether a substantial transformation occurs when components of
various origins are assembled into completed products, U.S. Customs and Border Protection
(“CBP”) considers the totality of the circumstances. 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.
Assembly operations that are minimal or simple, as opposed to complex or meaningful, will
generally not result in a substantial transformation. If the manufacturing or combining process is
a minor one which leaves the identity of the article intact, a substantial transformation has not
occurred. See Uniroyal, Inc. v. United States, 3 CIT 220 (1982), aff’d, 702 F.2d 1022 (Fed. Cir.
1983).
Packaging alone is not a substantial transformation. In Headquarters Ruling Letter
(“HQ”) 733729, dated January 2, 1991, the packaging of teas in Singapore was not deemed to be
a substantial transformation, as it resulted in no change in the name, character, or use of the
imported teas. The country of origin of the packaged teas was Sri Lanka, where the teas were
grown and processed by the addition of flavorings.
General Rule of Interpretation (“GRI”) 2(a) applies to unassembled or disassembled
goods presented with all components such as an unassembled bicycle or an unassembled latch.
In New York Ruling (“NY”) N344425, dated December 30, 2024, “Completely Knocked Down”
bicycles comprising of unassembled bicycle components were shipped from Malaysia and
assembled in the United States. The bicycle frames were made in Malaysia and many of the
other bicycle components, such as suspension forks, drive train parts, cranks, seats, and wheels,
were from other countries, including China. By application of GRIs 1 and 2(a), the unassembled
bicycle was classified as if it was a fully assembled bicycle in subheadings 8712.00.15 or
8712.00.35, HTSUS. The Malaysian bicycle frame was one of the bicycle’s most significant
components and determined the country of origin of the unassembled bicycles. Similarly in NY
N302992, dated March 27, 2019, bicycles were imported in a disabled state with one complete
bicycle in each box. The bicycle component assembly operation, inspection, and packaging
performed in Taiwan did not result in a substantial transformation of the frames. The country of
origin of the bicycles was China where the frames were cut, formed, and welded prior to being
shipped to Taiwan for component assembly.
The non-bicycle origin cases that you cited arrived at the same conclusion. In NY
N339173, April 17, 2024, the wind turbine steel structure was composed of front and rear
subassemblies, H-beams, and plates, which were assembled in Mexico by drilling and welding.
The production process began in China where the lower frame subassemblies for the front and
rear of the structure was manufactured. The Chinese front and rear subassemblies were finished
components that were imported into Mexico unassembled and tack welded together. The
manufacturing process in China rendered the end-use of the front and rear subassemblies pre-
determined and they could not be used for any other purpose. The front and rear subassemblies
were substantive components of the internal steel structure, which created the entire lower frame
of the structure and imparted the character of the internal steel structure. The addition of the H-
beams and the plates performed in Mexico did not substantially transform the internal steel
structure into a new and different article of commerce with a name, character, and use distinct
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from that of the exported good. The country of origin of the wind turbine internal steel structure
was China.
In NY N340848, July 5, 2024, in its condition as imported, the merchandise consisted of
a handle that contained a slave gear, drive bolt, and worm gear. Separately included with each
handle were unassembled side plates. A slave gear and worm gear were machined in China and
incorporated into the handle that was also cast in China. Next, a smooth bore and a chamfered
edge were created along the inner diameter of the slave gear and holes were drilled into the lower
body of the handle and threaded holes were tapped into the upper body for the side plates. The
unfinished Torque Jack handle had a pre-determined end-use and was not substantially changed
by the addition of the remaining components. In addition, the finishing and assembly operations
in the United States were not complex enough to transform the handle into a new article. When
the handle was exported from China it had the final shape and outline of the finished article and
could only be used as a torque Jack handle upon completion. The country of origin of the torque
Jack handle for purposes of Section 301 and marking was China.
The goods at issue here are considered to be complete but unassembled gate latch
assemblies classifiable under subheading 8302.49.60, HTSUS, pursuant to GRIs 1, 2(a), 3(b),
and 6. Each latch assembly is an unassembled composite good made up of a metal bolt and three
pieces of plastic housing that, when combined, create the gate latch. The stainless-steel t-latch
striker pin and q-bolt drop rod are made in China; the steel screws are made in Taiwan; and the
plastic housings, the packaging bags, stickers, and instructions are made in Australia. The latch
assemblies will be packaged by the importer’s supplier in Australia and will enter the United
States as an unassembled latch for home assembly by a U.S. purchaser. Like the bicycle frame
in NY N344425 and NY N302992, the front and rear assemblies in NY N339173, and the torque
Jack handle in NY N340848, the steel t-latch striker pin and q-bolt drop rod impart the essential
character to the latches because they provide the latches with their functionality, and, indeed, are
the most expensive component. The substantial transformation of the t-latch striker pin and q-
bolt drop rod occurs in China. Their character and use are pre-determined and will remain the
same after importation in the United States. See Nat’l hand Tool Corp., supra. When assembled
together with the steel t-latch striker pin and q-bolt drop rod, the remaining components will lose
their separate identities and will became an integral part of the t-latch striker pin and q-bolt drop
rod and the finished latch assemblies. See Uniroyal, Inc., supra. The packaging in Australia will
not substantially transform any of the individual components just like the packaging of the teas
in HQ 733729 was not deemed to be a substantial transformation.
Accordingly, we find that the countries of origin of the q-latch and t-latch assemblies will
be China (country of origin of the q-bolt and t-bolt pin) for purposes of Section 301 and IEEPA
duties.
HOLDING:
The countries of origin of the unassembled q-latch and t-latch assemblies at issue will be
China for purposes of Section 301 and IEEPA duties.
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Please note that 19 C.F.R. § 177.9(b)(1) provides that “[e]ach ruling letter is issued on the
assumption that all of the information furnished in connection with the ruling request and
incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and
complete in every material respect. The application of a ruling letter by a [CBP] field office to
the transaction to which it is purported to relate is subject to the verification of the facts
incorporated in the ruling letter, a comparison of the transaction described therein to the actual
transaction, and the satisfaction of any conditions on which the ruling was based.”
A copy of this ruling letter should be attached to the entry documents filed at the time this
merchandise is entered. If the documents have been filed without a copy, this ruling should be
brought to the attention of the CBP officer handling the transaction.
Sincerely,
Monika R. Brenner, Chief
Valuation and Special Programs Branch
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