CLA-2-90:OT:RR:NC:N1:105
Adam Mook Logistics Plus, Inc. 1406 Peach Street, Union Station Erie, PA 16501
RE: The tariff classification and country of origin of a hydrogen gas sensor printed circuit board assembly
Dear Mr. Mook:
In your letter dated September 6, 2023, on behalf of your client, Amphenol Advanced Sensors, you requested a tariff classification and country of origin determination ruling.
The item under consideration is a completed printed circuit board assembly (PCBA) for a hydrogen gas sensor used to detect the levels of hydrogen in the air. When imported into the United States, the PCBA has a gas sensing element, which is incorporated onto a printed circuit board along with a microprocessor and various electronic components (resistors, capacitors, diodes, etc.). The remaining components, such as the plastic housing, plastic lid, and compression limiters, are assembled in the United States. Additional calibration and testing are also performed in the United States, however, the sensor has measurement capabilities when it leaves China and provides the essential character of the finished sensor.
In operation, the raw signal bridge input is sampled and high frequency noise is filtered out. The signal chain is combined with secondary input to create a linearized output ratio metric to supply voltage. Input parameters are then checked for errors prior to output calculations and manipulated if the acceptance range is not met. The output of the hydrogen sensor is a ratio metric analog output with a detection range of 0 to 16% (160,000 parts per million (ppm)) hydrogen gas, which is used to provide concentration level of the sensed hydrogen gas in ppm levels. The sensor is built around a thermal conductivity sensing device that will change voltage dependent on the concentration of thermally conductive hydrogen gas in the environment around the sensor. This voltage is put through a digital to analog conversion, and a corresponding transfer function that provides an analog output voltage. The final sensors will be incorporated into the battery management systems on electric vehicles.
As you suggest in your letter, and in accordance with GRI 2(a), the applicable subheading for the printed circuit board assembly for the hydrogen gas sensor will be 9027.10.2000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Instruments and apparatus for physical or chemical analysis (for example, polarimeters, refractometers, spectrometers, gas or smoke analysis apparatus); instruments and apparatus for measuring or checking viscosity, porosity, expansion, surface tension or the like; instruments and apparatus for measuring or checking quantities of heat, sound or light (including exposure meters); microtomes; parts and accessories thereof: Gas or smoke analysis apparatus: Electrical.” The general rate of duty will be free.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 9027.10.2000, HTSUS, unless specifically excluded, are subject to an additional 25 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.02, in addition to subheading 9027.10.2000, HTSUS, listed above.
The HTSUS is subject to periodic amendment so you should exercise reasonable care in monitoring the status of goods covered by the Note cited above and the applicable Chapter 99 subheading. For background information regarding the trade remedy initiated pursuant to Section 301 of the Trade Act of 1974, you may refer to the relevant parts of the USTR and CBP websites, which are available at https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions and https://www.cbp.gov/trade/remedies/301-certain-products-china respectively.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided at https://hts.usitc.gov/current.
Regarding the country of origin of the PCBA for the hydrogen gas sensor, the manufacturing begins in Germany with the manufacturing of the silicon wafer. The wafer is then shipped to Switzerland where it is diced. In Taiwan, the die is packaged with a ceramic base, bonded to the base with adhesive, and wire bonds are connected from the die to a conductive trace. The packaged die has a laser welded lid with holes for the detection of hydrogen gas. A second version has no holes in the lid and is used as a reference. The devices are then shipped to China, where both thermal conductivity devices are attached to the printed circuit board using surface mount technology (SMT). Additional Chinese components, including the microprocessor, resistors, capacitors, diodes, etc., are also added to the PCB in China using SMT to create a finished PCBA. When the PCBA assembly is imported into the United States, it has the ability to detect and analyze, although the parts are not fully calibrated yet. Therefore, its detection and analyzing capabilities have limited accuracy. However, the PCBA can only be used as a hydrogen gas sensor when it leaves China.
The final PCBA is then shipped to the United States where it is calibrated to specific gas concentration levels and temperatures, which allows the sensor to achieve accuracies of -8000 to +8000 ppm over the range of 0 to 160,000 ppm of hydrogen gas.
With regard to the origin of the PCBA, the marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its 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. The “country of origin” is defined in 19 CFR 134.1(b) as "the country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the ‘country of origin’ within the meaning of this part.” The courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982).
Based upon the facts presented, it is the opinion of this office that the PCBA surface mount technology assembly process, which includes the installation of both thermal conductivity devices, microprocessor, and various electronic components (resistors, capacitors, diodes, etc.), results in a substantial transformation of the components from Germany, Switzerland, Taiwan, and China. The use of the SMT process transforms the individual components into a new and different article capable of determining the part per million of hydrogen in the air. Additionally, the processing performed in the U.S. to make the hydrogen gas sensor, including the assembly of the plastic housing, plastic lid, and compression limiters, along with the additional calibration and testing performed, does not substantially transform the article. Thus, the product remains a product of China where the SMT was used to build the PCBA and will not become a product of the United States. Accordingly, for origin and marking purposes, the printed circuit board assembly for the hydrogen gas sensor is considered a product of China at time of importation into the United States.
The holding 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 Jason Christie at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division