CLA-2-73:OT:RR:NC:N1:116
Ms. Deborah Stern, Esq.
Sandler, Travis & Rosenberg, P.A.
5835 Blue Lagoon Drive, Suite 200
Miami, FL 33178
RE: The country of origin of stucco netting
Dear Ms. Stern:
In your letter dated April 11, 2022, you requested a country of origin ruling determination on behalf of your client, Preferred Wire Products, Inc.
The merchandise under consideration is identified as rolls of 1.5” 17 gauge and 1” 20 gauge zinc plated round single-strand iron stucco netting. The stucco netting is used on wall surfaces as an underlayment for plastering, cementing, stuccoing and other wall constructions. You state that the galvanized woven hexagonal wire mesh is “self-furred” (or “furred”), meaning the wire is crimped throughout the netting. The crimping keeps the netting from lying directly on the wall and allows the netting to be embedded within the stucco, providing better reinforcement.
According to your submission, single-strand round galvanized iron wire will be imported in bulk, on rolls from China and other countries (typically Vietnam and Turkey), into Canada. The wire will undergo specialized machining in Canada to produce the subject stucco netting. You state the process will be the same for the 17 gauge and 20 gauge netting but will use different machines depending on the diameter of the wire. First, coils of single strand round wire are placed vertically onto stands. The stands are placed into the “Take -Up” of the netter, with the beginning of the coil welded to the end of the previous. As the netter runs, it pulls the wires to it. Then, the netter weaves the wire into netting by twisting the wire with its mates on each side. The wires are twisted approximately two and a half times around. Finally, the “Furr Unit” will place crimps across the netting. After packaging and labelling, the stucco netting will be exported to the United States.
Please be advised when determining the country of origin for purposes of applying current trade remedies under Section 301, Section 232, and Section 201, the substantial transformation analysis is applicable. 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). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987).
In determining whether machining operations effect a substantial transformation, Customs distinguishes between the kind and amount of further processing performed, i.e., between machining operations performed to achieve a specified form and those performed to achieve more cosmetic or minor processing operations. See C.S.D.s 89-121 and 90-53. Customs consistently has found that embellishment and finishing operations, such as polishing, enameling and cleaning, are not regarded as extensive processes that result in a new and different article of commerce. See HQ 554689 (August 21, 1987) and HQ 071314 (May 10, 1983).
Based on the information provided, the zinc plated round single-strand wire, which is manufactured in either China, Vietnam, or Turkey, is furred, woven, and twisted into netting in Canada. This office finds that the processing operations performed in Canada result in a new name, a new character, and a new use from that of the original wire. Processing the wire into furred netting does effect a substantial transformation and gives us a new and different article of commerce. As such, the country of origin of the subject stucco netting will be Canada.
As the netting is a product of Canada, Section 232 and/or 301 duties are not applicable.
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 Angelia Amerson at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division