The country of origin of components for a CNC Machining Center.

N309850 March 13, 2020 CLA-2-84:OT:RR:NC:N1:104 CATEGORY: Country of Origin Dale C. Flowers Import/Export Coordinator MAG Automotive LLC 6015 Center Drive Sterling Heights, MI 48312 RE: The country of origin of components for a CNC Machining Center. Dear Mr. Flowers: In your letter dated February 14, 2020, you requested a country of origin ruling. The items under consideration are the B-Axis Base (part number X.1024.8742); Column (part number T.1041.4915); and Saddle (part number T.1041.5002) for a CNC Machining Center used in the production of automotive engine blocks and heads. All three components are made of cast iron and are integral to the CNC Machining Center. The B-Axis Base provides the foundation to the CNC Machining Center. The Column is mounted to the base and provides a mounting surface for the tool changer system. The Saddle provides a foundation for the linear rails and sliding mechanisms for the spindle, which is used for cutting the part. All three components are manufactured in China to form castings with no machining done other than deburring and removing of the fins and then are exported to Hungary for further processing. In Hungary, the B-Axis Base is machined with a milling process; all mounting holes are drilled and tapped; and the top of the base is then finished milled. Next, the Column is rough milled on the top and bottom; all mounting holes are drilled and tapped and large holes are bored with a boring tool; and the top and bottom of the column is then finished milled. Finally, the Saddle receives an initial milling cut for rough machining; all mounting holes are drilled and tapped and large holes are bored with a boring tool; and all mounting surfaces receive the final finish machining. With regard to your request for the appropriate country of origin of the B-Axis Base, Column, and Saddle, 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 U.S. 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 case of U.S. v. Gibson-Thomsen Co., Inc., 27 C.C.P.A. 267 (C.A.D. 98) (1940), provides that an article used in manufacture which results in an article having a name, character, or use differing from that of the constituent article will be considered substantially transformed. The court in National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993), determined that imported forgings, in that case, were not substantially transformed as (1) the articles had been forged “into their final shape before importation” into the United States and (2) “the form of the components remained the same” after the processes performed in the United States. The court concluded that no substantial change in name, character or use had occurred as a result of the processing performed in the United States. Likewise, in this case, the B-Axis Base, Column, and Saddle are all manufactured to their final specifications in China prior to their exportation to Hungary. Their use is predetermined prior to processing in Hungary. The components have the same name both before and after processing in Hungary. In addition, the machining operations performed in Hungary such as milling, drilling, tapping, and boring do not result in a substantial transformation. Thus, the country of origin for the components, as described above, 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 Denise Hopkins at [email protected]. Sincerely, Steven A. Mack Director National Commodity Specialist Division