OT:RR:NC:N1:103
Lydia Pardini
AMS Trade LLP
1133 Connecticut Avenue NW, Suite 1201
Washington, DC 22314
RE: The country of origin of a mobile scissor lift.
Dear Ms. Pardini:
In your letter dated March 7, 2022, you requested a country of origin ruling determination on a mobile scissor lift on behalf of your client, Sinoboom Poland Sp. z o.o.
The merchandise under consideration is an electric propelled scissor lift with a hydraulic lifting platform. Included in your request are several models that all serve the same function, but differ in specifications, such as working height, horizontal extension, and loadbearing capacity. You state the sourcing and production process for each model is the same.
Each scissor lift is manufactured using 21 subassemblies and components sourced from Poland, Germany, Italy, France, India, Vietnam, Mexico, and China. You identify five major structural subassemblies that are produced in Poland: the arm, platform, chassis, counterweight, and assembly pin. The control system includes electrical components sourced from Germany and Italy. The driving system, which consists of a gear box system, is sourced from India. The hydraulic system contains components sourced from Poland, Italy, and Germany. The electrical system consists of a motor from Germany, sensor from Italy, switch from France, harness cable from Poland, battery from Vietnam, and battery charger from Mexico. Various components including tires, fastening pieces, plastic covers, and fuses are sourced from China. All of the subassemblies and components are sent to Sinoboom’s facility in Poland for final assembly.
The production process begins in Poland with the manufacturing of the major structural subassemblies. The metal components of the arm subassembly are formed from steel through a machining process that involves sawing tube, punching holes, lathing, laser cutting, pressing, drilling, and boring. The metal components for the chassis subassembly and platform subassembly are also produced using a machining process that includes laser cutting, sawing, drilling, tapping, bending, pressing, and burring. To form each subassembly, the metal components go through a welding process that includes laser cutting, deburring, bending, drilling, fitting, tack welding, and finish welding. Afterward, they undergo treatment with a coating process to ensure smooth operation and prevent rust, corrosion, and other damage. This involves shot blasting, primer coating, top coating, curing, and finally, touch up.
Prior to final assembly, the hydraulic components, arm pack, and platform go through a pre-assembly process. The pre-assembly of the hydraulic components involves combining a motor and pump, installing connectors, and attaching hoses. The arm subassembly also undergoes a pre-assembly process that includes lubricating and inserting bearing assemblies into shaft assembly holes located on the arms. A lift cylinder is also aligned and inserted into the arms and secured using keeper pins and bolts. The platform pre-assembly process involves aligning, mounting, and fastening a guardrail assembly, rear rail assembly, platform door assembly, platform door lock assembly, and platform pad to a platform subassembly.
The final assembly occurs across eight stations. At the first station, a steering cylinder assembly, power harness, and chassis harness are installed to a chassis. At the drive installation station, a steering hose assembly, walking reducer assembly, and walking reducer harness assembly are aligned, connected, and fastened into place. Afterward, the tires are installed before the chassis is rotated and re-positioned. At the electrical components and battery installation station, the motor assembly and main valve assembly are aligned and fastened using bolts. In addition, wiring of the motor and motor controller are completed. At the charger installation station, the charger assembly and battery assembly are installed, connected, and secured using screws and washers. Next, the platform subassembly, arm subassembly, and counterweight are mounted into place. This is followed by routing and installing various hoses, sensors, and harnesses. Lastly, workers test, calibrate, and inspect each scissor lift.
As stated in HQ 735009, dated July 30, 1993, “The country of origin is the country where the article last underwent a ‘substantial transformation’, that is, processing which results in a change in the article's name, character, or use.” In addition, the court has held that “A substantial transformation occurs when an article emerges from a manufacturing process with a name, character, and use that differs from the original material subjected to the processing.” 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 Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308 (2016), the Court of International Trade (“CIT”) interpreted the meaning of “substantial transformation” as used in the Trade Agreements Act of 1979 (“TAA”) for purposes of government procurement. In Energizer the court reviewed the “name, character and use” test in determining whether a substantial transformation had occurred in determining the origin of a flashlight, and reviewed various court decisions involving substantial transformation determinations. The court noted, citing Uniroyal, Inc. v. United States, 3 C.I.T. 220, 226, 542 F. Supp. 1026, 1031, aff’d, 702 F.2d 1022 (Fed. Cir. 1983), that when “the post-importation processing consists of assembly, courts have been reluctant to find a change in character, particularly when the imported articles do not undergo a physical change.” Energizer at 1318. In addition, the court noted that “when the end-use was pre-determined at the time of importation, courts have generally not found a change in use.” Energizer at 1319, citing as an example, National Hand Tool Corp. v. United States, 16 C.I.T. 308, 310, aff’d 989 F.2d 1201 (Fed. Cir. 1993). Furthermore, courts have considered the nature of the assembly, i.e., whether it is a simple assembly or more complex, such that individual parts lose their separate identities and become integral parts of a new article.
Based upon your description of the manufacturing operations, the nature of the processing performed in Poland is not a simple one. In addition to the final assembly occurring in Poland, all of the major structural subassemblies (i.e., the arm subassembly, chassis subassembly, and platform subassembly) are manufactured from steel material and transformed into integral subassemblies in Poland. The complex operations resulted in the individual parts losing their separate identities to become a new article. Thus, based on the totality of the circumstances, the country of origin of the mobile scissor lift will be Poland.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
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 Customs Service 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 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 Paul Huang at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division