OT:RR:CTF:EPDR H351143 SAB
Michael Carr
Crane Worldwide Logistics
1500 Rankin Road
Houston, TX 77073
RE: Eligibility for temporary importation under bond of certain valves; United States-Mexico-
Canada Agreement (USMCA)
Dear Mr. Carr,
This is in response to your request for a ruling, dated August 4, 2025, on behalf of your
client, Woodside Energy Group LTD (Woodside). Woodside seeks a determination as to whether
certain valves are eligible for duty-free treatment under subheading 9813.00.05 of the
Harmonized Tariff Schedule of the United States (HTSUS), as a temporary importation under
bond (TIB). Our decision follows.
FACTS:
Woodside proposes to import from Italy several valve types, specifically gate valves
which are distinguishable by part and serial number, as well as sizing, wall thickness, and
description. The valves will be welded onto pipes in the United States to create a “pipeline end
termination” structure (PLET), which you state will be exported to Mexico. A PLET structure is
a subsea structure that serves as the termination point for a pipeline and provides a foundation for
stability and a hub for connecting the pipeline to other subsea equipment. Once assembled, the
valves control the flow of oil and gas in subsea pipelines.
At importation, the valves are catalogued for purposes of quality control then welded to
pipes that will be assembled into a PLET structure. Once welded to the pipes, the valves undergo
hydrostatic testing and are inspected by Certified Welding Inspectors who record the specific
valves/parts, weldments, and fabrication dates. If a valve were to become damaged or unusable,
the valve would be identifiable, and Woodside would accomplish any necessary destruction
under U.S. Customs and Border Protection (CBP) supervision. Woodside notes that the valves
are not modified in any way prior to welding because they are welded in the same condition as at
importation, and no alterations are necessary. As a consequence of the valves not being modified,
the welding process does not generate any waste. Woodside asserts once the welding process is
complete, the finished PLET structure is a new article produced in the United States that is
originating under the U.S.-Mexico-Canada Agreement (USMCA). Woodside seeks a binding
ruling to confirm whether the valves are eligible to be entered under TIB subheading 9813.00.05,
HTSUS.
ISSUE:
Whether the valves are eligible to be entered under TIB subheading 9813.00.05, HTSUS.
LAW AND ANALYSIS:
General Note 1, HTSUS, dictates that all merchandise imported into the United States is
subject to duty unless specifically exempted therefrom. Such an exemption is accorded to articles
temporarily imported for repair, alteration, or processing, including processing that result in
articles manufactured or produced in the United States, under subheading 9813.00.05, HTSUS.
See U.S. Notes 1-2 of Subchapter XIII, Chapter 98, HTSUS. Duty-free treatment under this
subheading is conditioned on the imported merchandise being exported or destroyed within one
year from the date of importation. See 19 C.F.R. § 10.37. This one-year period may be extended
to one or more additional periods, which, when added to the initial period may not exceed three
years. Id. The imported merchandise may not be imported for the purpose of a sale or sale on
approval. See U.S. Note 1(a) of Subchapter XIII, Chapter 98, HTSUS; see also 19 C.F.R. §
10.31(a)(3)(iii).
Given that subheading 9813.00.05 of the HTSUS accords duty-free treatment to articles
intended to be “repaired, altered, or processed” in the United States, a determination as to
whether Woodside’s imported valves are eligible to be entered under subheading 9813.00.05,
HTSUS, thus hinges on whether the valves will be altered or processed. Although the terms
“altered” or “processed” are not defined within the HTSUS, or the regulations governing TIBs in
Subpart A of 19 C.F.R. Part 10 (19 C.F.R. §§ 10.31-10.40), these terms have been defined
through various rulings issued by CBP.
In Headquarters Ruling Letter (HQ) 224661, dated January 11, 1994, CBP explained that
processing for purposes of subheading 9813.00.05, HTSUS, “can be a relatively minor procedure
or extensive enough to be considered a manufacture or production.” In regard to welding, CBP
has consistently held that welding constitutes “processing” for purposes of subheading
9813.00.05, HTSUS. For example, in HQ 230286, dated April 12, 2004, a company imported
coils of titanium strips to be slit, rolled, and welded, to create titanium tubing. CBP determined
that “creating welded tube” from the imported strips qualified as processing. Id. More recently,
in HQ H297439, dated March 30, 2020, a company imported six individual vane parts to be
welded into a “Chevron Vane Assembly” (CVA) for use in nuclear power plants. CBP explained
that an article is deemed processed if subjected to an operation which results in a change to its
character and use to meet certain specifications. CBP concluded that welding vane parts into
CVA qualified as processing because prior to welding, the vanes are just loose parts that cannot
be installed into nuclear power plant’s moisture separator system – welding thus changed the
parts’ character and use because only the welded CVA could be used in a nuclear power plant.
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Additionally, CBP found that the welding operations resulted in a new and different article that
has a distinctive name, character, and use – the vane parts became the CVA. Id.
In this case, the imported valves will be subjected to a welding method that affixes the
valves to pipes that will subsequently be assembled into a completed PLET structure. As in
H297439, where the welding of the imported vane parts resulted in a change to the character and
use of the parts, rendering them fit for a specialized use once incorporated into the CVA, here the
welding renders the valves suitable for controlling the flow of oil and gas in subsea pipelines
once incorporated into the PLET. We therefore find that the imported valves are eligible to be
entered under TIB subheading 9813.00.05, HTSUS. Further, just as the welding operations in
H297439 produced a new and different article, the CVA, that had a distinctive name, character,
and use, from the imported vane parts, here the welding of valves onto pipes produces a PLET
structure. The PLET structure has a distinctive name, character, and use, from the imported
valves that is specific to managing the flow of fluids in subsea pipelines. Accordingly, we find
that the welding operation to which the imported valves will be subjected constitutes a “process”
within the meaning of subheading 9813.00.05, HTSUS, and this process results in an article
produced within the United States.
Pursuant to U.S. Note 2(b)(i) of Subchapter XIII, Chapter 98 of the HTSUS, whenever
merchandise is entered under subheading 9813.00.05, HTSUS, and manufactured, “if any
processing of such merchandise results in a[nother] article . . . manufactured or produced in the
United States . . . a complete accounting . . . for all articles, wastes and irrecoverable losses
resulting from such processing” is required and all articles or valuable wastes must be exported
or destroyed or, in the alternative, duties may be paid on the waste. As explained above, for
purposes of subheading 9813.00.05, HTSUS, processing “includ[es] processes which result in
articles manufactured or produced in the United States.” As we have determined that the welding
operations described by Woodside produce a new or different article of commerce, a PLET
structure, that has distinctive name, character, and use, from the imported valves, the accounting
requirements detailed in U.S. Note 2(b)(i) of Subchapter XIII are applicable. Although Woodside
explained that no waste is generated during welding, the requirement to account for all articles
produced and any “irrecoverable losses” remains applicable.
Finally, you indicate the PLET structures will be exported to Mexico. We note that
pursuant to U.S. Note 1(c) of Subchapter XIII, Chapter 98 of the HTSUS, “if an article imported
into the United States for processing, under heading 9813.00.05, is withdrawn for exportation to
Canada or Mexico, the duty assessed shall be waived or reduced in an amount that does not
exceed the lesser of the total amount of duty payable on the article that would have been payable
on importation under chapters 1 through 97, inclusive, of the tariff schedule or the total amount
of customs duty paid to Canada or Mexico on the exported article.” Accordingly, although an
article may be accorded duty-free treatment when entered under TIB subheading 9813.00.05,
HTSUS, upon exportation to Mexico, the article may be dutiable under the duty-deferral
provisions of the USMCA. Id.; see also 19 C.F.R. § 182.53(a)(2)(i)(A); HQ H312750 (Jan. 29,
2026) (“if an article is imported into a duty-deferral program in the United States, such as
temporary importation under bond, at subsequent exportation the good will be dutiable so long as
it constitutes a good subject to USMCA drawback that is not identified in 19 C.F.R. § 182.45”).
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HOLDING:
The valves are eligible to be entered under subheading 9813.00.05, HTSUS.
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 into 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 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.” If the terms of the import
or export contracts vary from the facts stipulated to herein, this decision shall not be binding on
CBP as provided for in 19 C.F.R. § 177.2(b).
Sincerely,
Kristina Frolova, Chief
Entry Process & Duty Refunds Branch
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