OT:RR:NC:N1:103
Lydia Pardini
AMS Trade LLP
1133 Connecticut Avenue NW, Suite 1201
Washington, DC 20036
RE: The country of origin of a telescopic boom lift.
Dear Ms. Pardini:
In your letter dated November 14, 2022, you requested a country of origin ruling determination on a telescopic boom lift on behalf of your client, Sinoboom Poland Sp. z o.o.
The merchandise under consideration is the Sinoboom telescopic boom lift, model numbers TB20J Plus and TB26J Plus, which are powered by a diesel engine, and TB20EJ Plus and TB26EJ Plus, which are battery powered. All the models serve the same function, but differ in mode of power, working height, horizontal extension, gradeability, and loadbearing capacity. The self-propelled telescopic boom lift includes a boom with an attached platform that holds up to three operators. Each lift features telescoping boom sections that extend in a straight line, a rotating turntable, and a rotating platform.
Each telescopic boom lift is assembled using subassemblies and components sourced from China, India, Italy, Poland, and the United States. For both the diesel and battery powered models, three major structural subassemblies: the chassis, platform, and turntable, are sourced from Poland. The boom tubes, counterweight, bracket, assembly pin, and the control module are sourced from China. The remaining components differ between the diesel and battery powered models and are also sourced from different countries.
For the diesel-powered telescopic boom lift, models TB20J Plus and TB26J Plus, the components for the driving system include a gear box from India, a pump from China, and a hydraulic motor from Italy. The components for the hydraulic system are sourced from China, Italy, and the United States. The engine is sourced from Germany while the components for the electrical system are sourced from Italy, China, and Poland. For the battery powered telescopic boom lift, models TB20EJ Plus and TB26EJ Plus, the components for the driving system are sourced entirely from India while the components for the hydraulic system are sourced from China and Italy. The components for the electrical system are sourced from Italy, China, and Poland. All of the subassemblies and components are sent to Sinoboom’s facility in Poland for final assembly.
In Poland, metal components are manufactured from raw materials using machining steps that include laser cutting, sanding, welding, boring, and painting. The metal components are then fitted, tack welded, and finish welded to form structural subassemblies. To prevent rust and corrosion, the components undergo a coating process that involves primer coating, shot blasting, top coating, and curing.
The structural subassemblies are sent to Sinoboom Poland, where various components are added and installed prior to final assembly. A floating cylinder, motor, fuel tank, reducer, steering components, tires, and legs are installed to the chassis subassembly. Separately, a worker installs the slewing support, swing support bolts, and rotary reducer to the turntable subassembly. A third subassembly, the boom case, requires assembly of the main arm, slider, head sheave assembly, wire rope, and telescopic cylinder. The telescopic arm is also assembled by inserting the boom tube sections (i.e., the base, the middle, and the fly) into each other and adding sliders. The upper leveling cylinder, lower leveling cylinder, and platform bar assembly are also added to the boom case subassembly.
The final assembly involves lowering the turntable onto the chassis subassembly where it is fastened with bolts. The hydraulic components for the turntable are set up before the counterweight, lifting cylinder, and engine are installed. Various electrical components are added, including the control box, motor controller, sensors, and switches. Next, the support arms, boom case subassembly, and platform are affixed to the turntable. Then workers install additional lifting cylinders, brackets, and the hood. Besides mounting a different motor and supporting electrical components, the steps involved in the final assembly of the battery powered model is similar to the diesel-powered model.
With regard to your request for the appropriate country of origin of the telescopic boom lift, 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.
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 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, three of the major structural subassemblies (i.e., the chassis, platform, and turntable) are manufactured from steel material and transformed into integral subassemblies in Poland. The complex operations result 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 telescoping boom lift will be Poland.
Please note the merchandise in question may be subject to antidumping duties and countervailing duties (“AD/CVD”). Written decisions regarding the scope of AD/CVD orders are issued by the Enforcement and Compliance office in the International Trade Administration of the Department of Commerce and are separate from tariff classification and origin rulings issued by Customs and Border Protection (“CBP”). You can contact them at https://trade.gov/enforcement/ (click on “Contact Us”). For your information, you can view a list of current AD/CVD cases at the Department of Commerce ITA website at https://www.trade.gov/data-visualization/adcvd-proceedings, and you can search AD/CVD deposit and liquidation messages using CBP’s AD/CVD Search tool at https://aceservices.cbp.dhs.gov/adcvdweb.
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."
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 Paul Huang at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division