H321969

U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection 
 HQ H321969 February 18, 2022 OT:RR:CTF:VS H321969 CMR CATEGORY: Origin Judith Lee, Esq. Gibson, Dunn & Crutcher LLP 1050 Connecticut Avenue, N.W. Washington, D.C. 20036-5306 RE: Country of Origin of Slide Gate Refractories used in Metallurgy or Metal Foundries (Top Plates, Gate Plates and Center Plates); Section 301 Trade Remedies Dear Ms. Lee: This is in response to your ruling requests, dated October 12, 2021, submitted on behalf of your client, Vesuvius USA Corporation (hereinafter, Vesuvius), regarding the country of origin of various styles of components of ladles and tundishes used in U.S. steel making and imported into the United States after processing in Mexico. You request a country of origin determination for purposes of Section 301 trade remedies duty assessment. Your two requests involve eight different styles of components, although one style is indicated to have two different style numbers. As the issue presented for all eight is the same, for simplicity, we will address all of the styles in this ruling. Members of this office met with you via Microsoft Teams on January 4, 2022, to discuss the ruling requests. That discussion and your submissions were considered in reaching the decision set forth below. FACTS: Your client, Vesuvius, designs and manufactures components used in steel making or metal foundries for the casting of steel and other metals. Among the components Vesuvius produces are parts used in ladles, that is, the vessels that transport molten metal from furnaces to reservoirs that feed the casting machines. The articles at issue herein are parts used in a component part known as a slide gate assembly or system. You identify the parts at issue as slide gate refractories, but also refer to these parts as top plates, gate plates and center plates. These parts are identified as styles KK19517, KK21513, KK28104, KA67021, KA66304, KA61081, KA64325, KA67690, and KA71288. You indicate that your client imports these parts under subheading 6903.20, of the Harmonized Tariff Schedule of the United States (HTSUS), which provides for: “Other refractory ceramic goods (for example, retorts, crucibles, muffles, nozzles, plugs, supports, cupels, tubes, pipes, sheaths and rods), other than those of siliceous fossil meals or of similar siliceous earths: Containing by weight more than 50 percent of alumina (Al2O3) or of a mixture or compound of alumina and of silica (SiO2).” To produce these components, materials are imported into Mexico from China, the United States and Germany. Certain materials are common for all types and styles of “refractory plates;” however, additional materials may be used depending upon which type and style of plate is to be produced. These “refractory plates” consist, at a minimum, of a Chinese-produced refractory ceramic plate within a German-produced steel frame (also known as “frame assembly”), held in place with U.S.-produced mortar and coated with U.S.-produced graphite. Some item numbers have additional components, such as a nozzle, zirconia insert, steel strap, binding clip or steel pins. The components are assembled in Mexico. Certain styles have nozzles attached which are produced in Mexico. Four styles have zirconia inserts, one of which is a product of the United States, while the rest are products of Mexico. One style may have a frame assembly produced in Germany or the United States. In addition, graphite coating from the United States is listed as a material in the production for some, though not all styles, but does appear to be used in the production of all. The description of the processing of the top, gate and center plates set forth herein does not include every step for each style, but attempts to simplify the processing and present the most important elements of the processing and assembly which occurs in Mexico. We note the Chinese-produced refractory ceramic plates, or inserts, are imported into Mexico as blanks, that is, shaped to their final dimensions. For three styles of the top plates, the refractory ceramic plates are formed so that the area where a portion of the plate is to be drilled to form a channel for molten liquid to pass through is apparent from the shape of the unfinished plate. A photograph of the Chinese-produced refractory ceramic plate, or insert, for style KA61081 was not available. However, we have no reason to believe it differs very much from the other top plate blanks. You submit that the components imported into Mexico must undergo further processing prior to assembly of the components into the finished top plates, gate plates and center plates. For the four styles of top plates, this processing includes: Stamping of the can, otherwise known as the frame assembly. The frame assemblies are ready-to-use, that is sized and shaped for the inserts they are to receive, at the time of importation into Mexico. The information stamped on the frame assembly is the work order for the refractory plate being processed. The work order is stamped on the frame so that the employees can better trace the work order throughout the assembly process. Drilling of a hole in the refractory ceramic plate. The Chinese-produced refractory ceramic plates are imported into Mexico as formed blanks. As noted below, the area in which drilling is to be done and an insert is to be attached is readily apparent. Assembly of the plate, or insert, with the frame assembly using mortar. For style KA64325, prior to the assembly of the plate with the frame assembly, a steel strap is placed around the edge of the ceramic plate and held in place by a banding clip. For styles KA67690 and KA71288, a zirconia insert is attached with mortar to the ceramic plate and must set for 6 hours. It is our understanding that the zirconia inserts are drilled to form drainage channels at the factory in Mexico. All styles are heated to allow the mortar to properly bond the components and become heat resistant. Any surface imperfections on the exposed side of the ceramic plate are ground down to create a smooth surface and the plates are heat treated to dry any non-chemical water. Style KA71288 has additional steps which include the application of a castable solution and use of a Nelson Stud Refractory Anchor. Finally, a graphite lubricant is applied to the exposed side of the finished refractory ceramic plates prior to packing. With regard to the gate plates and center plates, styles KK19517, KK21513, KK28104, KA67021, and KA66304, the Mexican processing is substantially similar to that for the top plates. This processing includes: Stamping of the can, or frame assembly which is ready-to-use at the time of importation into Mexico. As with the top plates, the information stamped on the frame assembly is the work order for the refractory plate being processed. Processing of the refractory ceramic plate. The Chinese-produced refractory ceramic plates are imported into Mexico as formed blanks. As noted below, the area in which drilling is to be done or an insert or nozzle is to be attached is readily apparent. It appears that only three of the Chinese-produced refractory ceramic plates are drilled to form a drainage channel, as two appear to be imported into Mexico with openings already in the plates in which inserts will be placed. For styles with nozzles, KK19517, KK21513, and KK28104, the nozzles are welded to the frame assembly. While not clear, it appears that the plates, or inserts, are assembled with the frame assemblies after the nozzles are welded to those assemblies. Style KK28104 also has a zirconia insert attached to the refractory ceramic plate using U.S.-produced mortar. It is our understanding that the zirconia insert is drilled to form a drainage channel at the factory in Mexico For styles KA67021, and KA66304, the refractory ceramic plates are imported into Mexico with openings for the placement of inserts. The inserts a

The United States Trade Representative (“USTR”) has determined that an additional ad valorem duty 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(f), HTSUS. Among the subheadings listed in U.S. Note 20(f) is 6903.20.00, 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). If the manufacturing or combining process is a minor one which leaves the identity of the article intact, a substantial transformation has not occurred, and the essence of the article is considered. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (1982), aff’d 702 F.2d 1022 (Fed. Cir. 1983). You submit that the processing and assembly operations in Mexico constitute a substantial transformation of the imported components into finished slide gate refractories. You contend that the processing of the components in Mexico enable the finished good to function as intended and change the character of the components. The banding, where applicable, and the insertion of the refractory plates into the frame assemblies ensure that cracks that may develop on the plates remain closed preventing leakage of molten metal and allowing the plates to continue functioning. The holes drilled into the refractory plates and zirconia inserts in Mexico, allow molten metal to flow through the plates and inserts, and enable the slide gate refractories to function as intended. In addition, you contend that the