CLA-2-84:OT:RR:NC:N1:164
Vincent Liu
Olympia Tools International Inc.
929 N Grand Ave.
Covina, CA 91724
RE: The classification and country of origin of a tool set
Dear Mr. Liu:
In your letter dated September 18, 2025, you requested a classification and country of origin ruling on a
90-piece tool set. Product information was submitted with your request.
The item under consideration is described as a 90-piece tool set packaged in a molded plastic storage case for
retail sale. You state the set will be imported fully assembled with no additional processing after importation.
The set consists of:
1 - 3/8-inch drive ratchet handle
1 - Ratchet screwdriver
1 - 6-inch lineman’s pliers
1 - 6-inch long nose pliers
1 - 6-inch slip-joint pliers
1 - 6-inch diagonal pliers
1 - 8-ounce fiberglass claw hammer
1 - Phillips #1 screwdriver
2 - Slotted screwdriver
8 - Metrix hex keys
8 - SAE hex keys
1 - 1/4-inch male to 3/4-inch female socket adapter
6 - 2-inch spring clamps
2 - 4-inch spring clamps
18 - 1/4-inch drive sockets
2 - 3/8-inch drive sockets
30 - Driver bits
3 - Bit holders
1 - 6-inch torpedo level
1 - 16-foot tape measure
1 - Plastic storage case
In your request, you propose two origin scenarios. In Scenario A, the 3/8-inch drive ratchet handle and the
ratchet screwdriver will be manufactured in Vietnam, and the remaining components manufactured in China.
In Scenario B, the 3/8-inch drive ratchet handle will be manufactured in Vietnam, and the remaining
components will be manufactured in China. In both scenarios, the components will be consolidated and
packaged for retail sale in China.
Classification
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in
accordance with the General Rules of Interpretation (GRIs). GRI 1, HTSUS, states in part that for legal
purposes, classification shall be determined according to the terms of the headings, any relative section or
chapter notes and, unless otherwise required, according to the remaining GRIs taken in order. Goods that are,
prima facie, classifiable under two or more headings, are classifiable in accordance with GRI 3. The instant
tool sets consist of at least two different articles that are, prima facie, classifiable in different headings. They
consist of articles put up together to carry out a specific activity (i.e., maintenance and repair). Finally, the
articles are put up in a manner suitable for sale directly to users without repacking. Therefore, the set in
question is within the term “goods put up in sets for retail sale.”
GRI 3(b) states in part that goods put up in sets for retail sale, which cannot be classified by reference to GRI
3(a), are to be classified as if they consisted of the component which gives them their essential character.
Inasmuch as no essential character can be determined, GRI 3(b) does not apply. GRI 3(c) states that, if
neither GRI 3(a) nor GRI 3(b) applies, merchandise shall be classified in the heading which occurs last in
numerical order among those equally meriting consideration. In this instance, the items equally meriting
consideration are the ratchet handle, ratchet screwdriver, pliers, screwdrivers, hammer, hex keys, bits,
sockets, and adapter. The ratchet handle and ratchet screwdriver are classified in the heading which occurs
last in numerical order among those meriting equal consideration (8466).
The appliable subheading for the 90-piece tool set will be 8466.10.0175, HTSUS, which provides for Parts
and accessories suitable for use solely or principally with the machines of headings 8456 to 8465…; tool
holders for any type of tool for working in the hand: Tool holders and self-opening dieheads: Other. The
general rate of duty will be 3.9 percent ad valorem.
Country of Origin
When determining the country of origin for purposes of applying current trade remedies under Section 301
and additional duties, the substantial transformation analysis is applicable. See, e.g., Headquarters Ruling
Letter H301619, dated November 6, 2018. 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
(C.C.P.A. 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).
According to the CBP website under Section 301 Trade Remedies Frequently Asked Questions, “When
importing goods put up in sets for retail sale (in accordance with General Rule of Interpretation 3) that
contain articles subject to the Section 301 remedy, if the product that imparts the essential character to the set
(i.e., the HTSUS provision under which the entire set is classified) is covered by the Section 301 remedy,
then the entire set will be subject to the additional 25 percent duties. If the HTSUS provision under which the
entire set is classified is not covered by the Section 301 remedies, but the set contains components that are
classified in a subheading covered by the 301 list, the 301 duties will not be assessed on the individual
components.”
In this case, the tool holders (e.g. ratchet handle and ratchet screwdriver) impart the essential character per
GRI 3 and thus control the of origin of the set. In Scenario A, both the ratchet handle and the ratchet
screwdriver originate in Vietnam. Accordingly, the country of origin in Scenario A is Vietnam. In Scenario
B, the ratchet handle originates in Vietnam, and the ratchet screwdriver originates in China. Between these
tool holders, we determined the ratchet screwdriver imparts the essential character of the set because it is
used with a large quantity of bits (30). By comparison, the ratchet handle is used with fewer items (20 sockets
and 1 adapter). As a result, the overall utility of the tool set is dependent more so on the ratchet screwdriver
than the ratchet handle. Consequently, the country of origin in Scenario B is China.
Marking
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that unless excepted, every
article of foreign origin imported into the United States 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 United States, the English name of the country of origin of the
article. Congressional intent in enacting 19 U.S.C. 1304 was “that the ultimate purchaser should be able to
know by an inspection of the marking on the imported goods the country of which the goods is the product.
The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by
knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should
influence his will.” See United States v. Friedlander & Co., 27 C.C.P.A. 297, 302 (1940).
Part 134 of the U.S. Customs and Border Protection (CBP) Regulations (19 C.F.R. 134) implements the
country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.1(b), CBP
Regulations (19 C.F.R. 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 the marking laws and regulations.
A substantial transformation occurs when, as a result of manufacturing process, a new and different article
emerges, having a distinct name, character or use, which is different from that originally possessed by the
article or material before being subjected to the manufacturing process. See United States v.
Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940).
You propose that the external packaging or individual items will be marked clearly and conspicuously with
“Made in Vietnam.” However, this proposal does not satisfy the marking requirements and is not an
acceptable country of origin marking. As you described, packaging tools does not substantially transform the
individual components. The ultimate purchaser must be able to clearly identify the country of origin of each
item in the set. Accordingly, each item’s origin must be clearly identified on the item or the external
packaging. Any references to the packaging must be preceded by the country of origin markings.
Effective March 4, 2025, pursuant to U.S. Note 2(u) to Subchapter III, Chapter 99, all products of China and
Hong Kong as provided by heading 9903.01.24, HTSUS, other than products classifiable under headings
9903.01.21, 9903.01.22, and 9903.01.23, HTSUS, will be subject to an additional 20 percent ad valorem rate
of duty. At the time of entry, you must report the applicable Chapter 99 heading, i.e. 9903.01.24, in addition
to subheading 8466.10.0175, HTSUS, listed above.
Effective April 5, 2025, Executive Orders implemented “Reciprocal Tariffs.” All imported merchandise must
be reported with either the Chapter 99 provision under which the reciprocal tariff applies or one of the
Chapter 99 provisions covering exceptions to the reciprocal tariffs. At this time, products of China, Hong
Kong, and Macau will be subject to an additional ad valorem rate of duty of 10 percent. Products of Vietnam
will be subject to an additional ad valorem rate of duty of 20 percent. At the time of entry, you must report
the Chapter 99 heading applicable to your product classification, i.e. 9903.01.25 (China) or 9903.02.69
(Vietnam), in addition to subheading 8466.10.0175, HTSUS, listed above.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under
subheading 8466.10.0175, 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 8466.10.0175, HTSUS, listed above.
The HTSUS is subject to periodic amendment, so you should exercise reasonable care in monitoring the
status of goods covered by the Note cited above and the applicable Chapter 99 subheading. For background
information regarding the trade remedy initiated pursuant to Section 301 of the Trade Act of 1974, including
information on exclusions and their effective dates, you may refer to the relevant parts of the USTR and CBP
websites, which are available at
https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions and
https://www.cbp.gov/trade/programs-administration/trade-remedies, respectively.
The tariffs and additional duties cited above are current as of this ruling’s issuance. 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
(C.F.R.), 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 C.F.R. 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 Taylor at [email protected].
Sincerely,
(for)
Denise Faingar
Designated Official Performing the Duties of the Division Director
National Commodity Specialist Division