The country of origin of a heat pump

N351901
August 21, 2025
OT:RR:NC:N1:102
CATEGORY: Origin Junyeong Park Dream Customs Consulting Company 611-ho, 3-dong, Ace Hitech City, Building 775 Gyeongin-ro, Yeongdeungpo-gu Seoul, South Korea 07299 RE: The country of origin of a heat pump Dear Mr. Park: In your letter dated August 1, 2025, you requested a country of origin ruling on a heat pump, on behalf of your client, KD Navien. Descriptive information was submitted for our review. The heat pump (Model No. GDHP87048SC2) primarily consists of a chassis that encases a compressor, a heat exchange unit, a motor and fan assembly, valve assemblies, a control panel and an accumulator. Once paired with an indoor unit, which is imported separately, the system heats and cools spaces. With respect to origin, the final assembly occurs in South Korea using components from China. Prior to the final assembly process, flat fin-tube assemblies that are rectangular in shape are bent into shape in South Korea. Next, U-shaped tubes, inlets and outlets are brazed onto the shaped fin-tube assemblies to produce a heat exchange unit that functions as a condenser or an evaporator. The final assembly begins by installing rubber grommets onto the bottom of a compressor. Next a compressor and an accumulator are positioned and fastened onto a base using bolts. During the following step, heating tape and a spring are bolted in place and a high-pressure pipe assembly is fastened in position using two bolts. Afterwards, a pipe from a four-way valve assembly is positioned to the exterior of the unit, the inlets and outlets of the compressor and accumulator are brazed into position, and an electronic expansion valve (EEV) assembly is secured to a support plate. Next, a heat exchanger unit is screwed onto the base and subjected to brazing processes at the points in which the service valve assembly connects to the EEV assembly, the EEV assembly connects to the condenser pipe, and the condenser pipe connects to the 4-way valve assembly. Once the brazing processes are complete, the outer panels are connected to the base and secured in place using screws. Subsequently, a compressor power cable and its respective cover are installed, which is followed by the installation of auxiliary components, such as a sensor, a sound jacket, an EEV coil and a solenoid valve. The unit then undergoes a vacuum process, followed by a charging process. Finally, a fan assembly and a top control panel are secured in place, and the required wiring connections are affixed.

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). Additionally, 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 Regulations (19 CFR 134) implements the country-of- origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.1(b), CBP 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 the marking laws and regulations. In this instance, a heat exchange unit produced in South Korea is assembled with components sourced from China, such as a compressor and a chassis, in South Korea to produce a heat pump. The steps that occur during the final assembly process are not complex, as they consist of processes such as screwing, bolting and brazing, which is recognized as a welding operation used to join pipes to heat exchangers. See Headquarters Ruling Letter 555377, dated October 16, 1989. Therefore, it is our view that the Chinese components are not substantially transformed with a new name, character, or use. As such, the country of origin of the heat pump, model number GDHP87048SC2, is China 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 Sandra Martinez at [email protected].
Sincerely,
(for) James Forkan Acting Director National Commodity Specialist Division