H314637

HQ H314637 March 2, 2021 OT:RR:CTF:VS H314637 JMV CATEGORY: Origin Jeremy R. Page Page-Fura PC 939 W. North Avenue, Suite 750 Chicago, IL 60642 RE: Country of origin of an Automotive Rear Seat Frame; Section 301 trade remedy; Marking Dear Mr. Page: This is in response to your request, dated October 3, 2020, filed on behalf of your client Yanfeng Seating Mexico S.A. de C.V. (“YFS”). In your letter, you request a binding ruling on the applicability of Section 301 trade remedies and country of origin marking for an automotive rear seat frame. FACTS: The product at issue is an automotive rear seat frame identified by YFS as part number 8079846 produced in Mexico from parts of United States, Mexican and Chinese origin. Production of the rear seat frame consists of assembling 52 distinct components (21 of Chinese origin, one of U.S. Origin, the rest of Mexican Origin) and starts with the production of eight subassemblies: A bracket recliner assembly consisting of five components of Mexican origin and one of U.S. origin. These six components are arc welded together to create the bracket recliner assembly. A bracket stiffener assembly made up of four components of Mexican origin that are joined by arc welding. A second bracket stiffener assembly made up of three components of Mexican origin that are joined by arc welding. A bracket assembly, which consists of a bracket, a pivot brushing, and an EZE interlocking pin, all of Mexican origin. These parts are joined together with rivets. A second bracket assembly, which consists of a bracket and nut, both of Mexican origin, joined together by arc welding. A left hand bracket assembly, consisting of a Mexican origin bracket stiffener and seat back pillar joined by arc welding. A tube assembly, again produced through arc welding that consists of a tube of Chinese origin and two (2) cushion pan support brackets of Mexican origin. A center retractor bracket assembly produced from two: a center retractor bracket of Mexican Origin and a center latch striker of Chinese origin. These two parts are combined through arc welding. These subassemblies will then be combined with additional parts to create higher-level subassemblies. First, the cushion welding assembly is produced by arc welding 16 distinct components together: six of the subassemblies above, three components of Mexican origin, and seven components of Chinese origin. The bracket recliner assembly, the two bracket stiffener assemblies, a tube assembly, two bracket assemblies and an ISOFIX tube assembly are welded together to produce the foundational structure for the seat frame. Next, the pivot shaft and torsion springs are assembled with the plastic sleeve, which are later joined to the seat frame as a unit. The pivot bracket welding assembly and the pivot tube bracket are welded to the structure. Finally, two ISOFIX wires are welded to produce the cushion welding assembly. The second major assembly is the upper back frame, which will be produced from seven components, including the center retractor bracket assembly and the bracket left hand assembly already produced by YFS in Mexico. The frame will also include five components of Chinese origin: a retractor guide, top tether wire, a cross tube, head rest tube, and left hand stock frame. The left hand stock frame is arc welded to the left hand bracket assembly and the cross tube. The top tether wire is then joined, followed by the retractor bracket assembly. The two headrest tubes and the retractor guide wire are welded to the back frame resulting in the upper back frame assembly. Finally, the cushion welding assembly and the upper back frame and nine additional components, seven of Chinese origin, two of Mexican origin, are combined to produce the finished rear seat frame though four final steps. First, a bracket is welded to the structure. Second, two latches are joined to the frame with a bolt and torque gun. Then, the torque gun is used to attach the arbor and clock spring to the frame. Finally, the upper back frame and cushion welding assembly are married to one another with the M12 Bolt. As a final step, an e-coating is added to the complete assembly. The automotive seat back frame is classified under subheading 9401.90.10 of the Harmonized Tariff Schedule of the United States (“HTSUS”). Eight of the parts are also classified under subheading 9401.90.10, HTSUS and 24 of the parts are classified under 8302.30, HTSUS. The remainder are classified in various subheadings of chapters 39, 73, and 84, HTSUS. ISSUE: What is the country of origin of the automotive rear seat frame for purposes of applying Section 301 trade remedies? What is the country of origin of the automotive rear seat frame for marking purposes? LAW AND ANALYSIS: Section 301 Duties The United States Trade Representative (“USTR”) has determined that an additional ad valorem duty of 7.5% will be imposed on certain Chinese imports pursuant to USTR’s authority under Section 301(b) of the Trade Act of 1974 (“Section 301 measures”). The Section 301 measures apply to products of China enumerated in Section XXII, Chapter 99, Subchapter III, U.S. Note 20(s), HTSUS. Among the subheadings listed in U.S. Note 20(s) of Subchapter III, Chapter 99, HTSUS, is 9401.90.10, HTSUS. When determining the country of origin for purposes of applying trade remedies under Section 301, 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, 69 C.C.P.A. 151 (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. Belcrest Linens v. United States, 573 F. Supp. 1149 (Ct. Int’l Trade 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. Uniroyal, Inc. v. United States, 3 C.I.T. 220, 542 F. Supp. 1026 (1982), aff’d 702 F.2d 1022 (Fed. Cir. 1983). The Court of International Trade more recently interpreted the meaning of “substantial transformation” in Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308 (2016). Energizer involved the determination of the country of origin of a flashlight, referred to as the Generation II flashlight. All of the components of the flashlight were of Chinese origin, except for a white LED and a hydrogen getter. The components were imported into the United States and assembled into the finished Generation II flashlight. The Energizer court reviewed the “name, character and use” test utilized in determining whether a substantial transformation had occurred and noted, citing Uniroyal, Inc., 3 C.I.T. at 226, 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, Natio

Section 301 DutiesThe United States Trade Representative (“USTR”) has determined that an additional ad valorem duty of 7.5% will be imposed on certain Chinese imports pursuant to USTR’s authority under Section 301(b) of the Trade Act of 1974 (“Section 301 measures”). The Section 301 measures apply to products of China enumerated in Section XXII, Chapter 99, Subchapter III, U.S. Note 20(s), HTSUS. Among the subheadings listed in U.S. Note 20(s) of Subchapter III, Chapter 99, HTSUS, is 9401.90.10, HTSUS. When determining the country of origin for purposes of applying trade remedies under Section 301, 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, 69 C.C.P.A. 151 (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. Belcrest Linens v. United States, 573 F. Supp. 1149 (Ct. Int’l Trade 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 occ