CLA-2-82:OT:RR:NC:N1:118
Mr. M. Jason Cunningham
Sonnenberg & Cunningham PA
780 Fifth Ave. South
Suite 200
Naples FL 34102
RE: The country of origin of a pipe wrench.
Dear Mr. Cunningham:
In your letter dated December 4, 2019, on behalf of your client, Great Star Industrial USA, LLC, you requested a ruling on the country of origin of a pipe wrench.
You state that the subject steel wrench is designed to turn threaded pipe and pipe fittings so that they may be tightened or loosened. The wrench has an adjustable jaw size with hardened serrated teeth. The hard teeth bite into the softer metal of the pipe, providing the grip necessary to turn the pipe. The design of the adjustable jaw allows it to bind on the pipe when forward pressure is applied to the handle by pulling the jaws tighter. The pipe wrench jaws unlock when pressure on the handle of the wrench is released.
In your request, you provide a production-processing scenario for the pipe wrench. In Vietnam the wrench’s raw steel rods (sourced from China, Vietnam, or other global sources) are drop forged and die cut to make the top jaw, and die cast to make the tool handle. The two pieces are then sent to China where the top jaw teeth are milled, and threads are cut into the top jaw’s shank. The parts are heat-treated, polished, painted, laser etched, then assembled with Chinese origin screw and steel bottom jaw teeth before retail packaging. You contend the processing and assembly operations in China and the addition of Chinese components there do not substantially transform the Vietnamese components of the pipe wrench.
With regard to your request for the appropriate country of origin of the pipe wrench, 19 C.F.R. § 134.1(b) provides in pertinent part as follows:
Country of origin means 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 test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character and use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982). 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 order to determine whether a substantial transformation occurs when components of various origins are assembled into completed products, all factors such as the components used to create the product and manufacturing processes that these components undergo are considered in order to determine whether a product with a new name, character, and use has been produced. No one factor is decisive, and assembly operations that are minimal will generally not result in a substantial transformation.
In our view, the wrench’s handle and top jaw, which are manufactured in Vietnam from substantially transformed Vietnamese or Chinese raw steel, constitute the major components of the article and impart the essential character to the finished pipe wrench. In the proposed production-processing scenario, in Vietnam the raw steel is drop forged, die cast, die cut, and milled, and the essential shape and form of the final product emerges. As a result of these operations, the handle and top jaw components are dedicated for use as pipe wrenches upon export from Vietnam. The Chinese processing consists of milling the top jaw teeth, cutting threads into the top jaw’s shank, heat-treating, polishing, painting, and laser etching, then assembling the parts with Chinese origin screw and Chinese steel bottom jaw teeth.
Based on the provided description of the assembly and processing operations performed in China, the handle and top jaw are not substantially transformed by the addition of the remaining components nor are the assembly operations complex enough so as to transform the handle and top jaw into a new article. Therefore, it is the opinion of this office that the pipe wrench described in your proposed production-processing scenario is country of origin Vietnam.
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 Anthony E. Grossi at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division