CLA-2-84:OT:RR:NC:N1:103
Derek Weaver
WEST Forwarding Services
17851 Jefferson Park Road Middleburg Heights, OH 44130
RE: The tariff classification and country of origin of a jack handle
Dear Mr. Weaver:
In your letter dated June 20, 2024, you requested a tariff classification and country of origin determination ruling on behalf of your client, Helline Innovations, Inc. A sample was submitted for our review along with pictures and a description of the manufacturing process.
The merchandise under consideration is referred to as an unfinished Torque Jack handle, which is described as a steel handle that is designed to replace the traditional S-shaped handle on a trailer jack or landing gear. While the finished Torque Jack can serve as a manual handle, it also incorporates gearing so that a power tool can be used to rotate a drive bolt that then lowers or raises the trailer jack.
In its condition as imported, the item is unfinished and consists of a handle that contains a slave gear, drive bolt, and worm gear. Separately included with each handle are unassembled side plates, which are described as covers that fit over the slave gear. Each handle has an overall length of 321.8 millimeters. Even though the unfinished Torque Jack closely resembles a torque drive binder (an apparatus for load securement), you explain that it cannot properly function as a torque drive binder because of its shorter overall length.
The applicable subheading for the Torque Jack handle will be 8431.10.0090, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Parts suitable for use solely or principally with the machinery of headings 8425 to 8430: Of machinery of heading 8425: Other.” The general rate of duty will be free.
In your submission, you also requested a country of origin determination. Based on the information provided, a slave gear and worm gear are machined in China and incorporated into a handle that is also cast in China. Next, a smooth bore and a chamfered edge are created along the inner diameter of the slave gear so that an extension pipe can be installed in the United States. Holes are drilled into the lower body of the handle for the spinner handle and threaded holes are tapped into the upper body for the side plates. The item is shot blasted, electrostatically coated, and packaged for export.
In the United States, an extension pipe is pressed into the center of the slave gear and welded in place. A hole is drilled into the extension pipe so that a threaded bolt and nut can be inserted, which are used by the consumer to secure the Torque Jack handle to the trailer jack. Lastly, the spinner handle and side plates are fastened to the handle.
With regard to your request for the appropriate country of origin of the Torque Jack handle, 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.
When determining the country of origin for purposes of applying trade remedies, the substantial transformation analysis is applicable. The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character, or use, different from that possessed by the article prior to processing. See Texas Instruments, Inc. v. United States, 681 F.2d 778 (CCPA 1982). In deciding whether the combining of parts or materials constitutes a substantial transformation, the determinative issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article. See Belcrest Linens v. United States, 6 CIT 204, 573 F. Supp. 1149 (1983), aff’d, 741 F.2d 1368 (Fed. Cir. 1984). Assembly operations that are minimal or simple, as opposed to complex or meaningful, will generally not result in a substantial transformation. Factors which may be relevant in this evaluation may include the nature of the operation (including the number of components assembled), the number of different operations involved, and whether a significant period of time, skill, detail, and quality control are necessary for the assembly operation. See C.S.D. 80-111, C.S.D. 85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D. 90-51, and C.S.D. 90-97. If the manufacturing or combining process is a minor one which leaves the identity of the article intact, a substantial transformation has not occurred. See Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983).
In viewing the information provided with your submission, the unfinished Torque Jack handle has a pre-determined end-use prior to being subjected to the described assembly processes in the United States. It is not substantially changed by the addition of the remaining components, nor are the finishing and assembly operations complex enough to transform the handle into a new article. While not ready for direct use, when the handle is exported from China it has the final shape and outline of the finished article and can only be used as a Torque Jack handle upon completion. Furthermore, although you state the Torque Jack resembles a torque drive binder, you proclaim its patent is licensed to another company which prohibits your company from turning the unfinished handle into a torque drive binder. Therefore, the country of origin of the unfinished Torque Jack handle is China for the purpose of marking and Section 301 Trade Remedies.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 8431.10.0090, 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., 9903.88.01, in addition to subheading 8431.10.0090, HTSUS, listed above.
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/.
The holding set 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 Paul Huang at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division