MAR-2-84:OT:RR:NC:N1:102
Kathy VonLintel
VIEGA LLC
585 Interlocken Blvd
Broomfield, Colorado 80021
RE: The marking and country of origin of ball valves for the purpose of 301 Trade Remedies
Dear Ms. VonLintel:
In your letter dated April 28, 2022, you requested a ruling on the marking and country of origin of butterfly valves for the purpose of 301 Trade Remedies. A description of the assembly processes was submitted for our review.
The items under consideration are ball valves, model numbers 4170, 4870, 5170, 5970. The manually actuated valves control the flow of water and gas in the piping systems. The valves mainly consist of a body (housing), a ball, and two end pieces, referred to as press connections. The press connections, which are specifically designed for the ball valves, allow the valves to connect to Viega, LLC piping systems.
In regard to country of origin for the purpose of 301 Trade Remedies, it is explained that components from China, Italy, Austria and Germany are assembled to each other to form a complete valve. The final assembly of the ball valves occurs in Germany.
The final assembly of each valve begins with a PTFE sealing element being screwed into the valve body. A German manufactured valve stem, which has been assembled to sealing elements, is then pressed into the valve body. Afterwards, a Chinese manufactured ball is pressed and positioned into the Chinese valve body, which has been coated in Germany. In addition, sealing from Italy, and O-rings from China are also inserted into the valve body. Next, Chinese sealing elements, German separator rings, and German grip rings are assembled onto the outer ends of the valve body and then, the two end pieces, which are manufactured in Germany, are welded to the ends of the valve body. Amongst the aforementioned steps, a German manufactured lever with a slipcover is assembled onto the valve body and held in place with a nut. Each completed valve is subject to various tests and inspections.
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.” Pursuant to Part 134, Customs Regulations (19 CFR §134) implements the country of origin marking requirements and exceptions of 19 USC 1304. Section 134.1(b), Customs Regulations (19 CFR § 134.1(b)), defines “country of origin” 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.” 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. A substantial transformation will not result from a minor manufacturing or combining process that leaves the identity of the article intact. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993).
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). 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 order to determine whether a substantial transformation occurs when components 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/manufacturing operations that are minimal will generally not result in a substantial transformation.
For the ball valves, components from China, Germany, Austria, and Italy are assembled to each other in Germany to form complete valves. As described above, the assembly processes are rather simple and do not result in a substantial transformation of the components. We note your assertation that welding the end connections onto the valve body is a significant operation, as they are the components that allow the ball valves to be installed into their application. However, the welding of the end connections does not substantially transform the components. The valves have not been transformed due to the welding processes. The identity of the valves is intact prior to the welding of the end connections.
Therefore, as the components themselves are not transformed in Germany into a new and different article of commerce with a name, character, and use distinct from the article exported, the country of origin of the valves for the purpose of 301 Trade Remedies is determined by their essence, their valve bodies, such as in NYR N313282, dated August 12, 2020. Accordingly, as the country of origin of the valve bodies is China, the country of origin of the ball valves, model numbers 4170, 4870, 5170, 5970, for the purpose of 301 Trade Remedies is China.
Each valve should be legibly, conspicuously, and permanently marked in accordance with the requirements of 19 U.S.C. 1304 to indicate that its country of origin is China.
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 Sandra Martinez at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division