H322364

 U.S. Department of Homeland Security Washington, DC 20229 U.S. Customs and Border Protection HQ H322364 June 3, 2022 OT:RR:CTF:VS H322364 CMR CATEGORY: Classification Robert T. Givens, Esq. Givens & Johnston, PLLC 950 Echo Lane Suite 360 Houston, TX 77024-2788 RE: Classification, Country of Origin, and Eligibility for Preferential Tariff Treatment under the United States – Mexico – Canada Free Trade Agreement of Selective Cushion Units Dear Mr. Givens: This is in response to your request on behalf of your client, Strato Inc., for a ruling on the classification, country of origin and eligibility for preferential tariff treatment under the United States – Mexico – Canada Free Trade Agreement (USMCA) of selective cushion units assembled in Mexico for use in railcars. FACTS: The articles at issue are certain cushion units assembled in Mexico. The cushion units are described as “a draft pack which is designed to absorb tension or provide cushioning as the freight cars pull apart, and a buff pack [which] is designed to compress and thus to absorb or cushion the load when the freight cars come together.” These draft packs and buff packs are assembled from two major components, i.e., steel components and elastomer pads. The elastomer pads are produced in the United States and have undergone a specialized molecular orientation process that transforms them from polymer into elastomer. The elastomer pads are able to remain in a fixed state of compression under no load, while still able to compress further to absorb tremendous additional amounts of energy as they are compressed under the in-service loads specified for a freight railcar. The steel components for the draft packs and buff packs, consisting of steel plates and, in the case of the draft pack, an additional steel casing, are imported into Mexico from various third countries. The middle plates are from suppliers in India and Vietnam and the end pieces are from suppliers in China. Thus, the steel components for each unit will be sourced from multiple countries. At the beginning of the Mexican assembly process for both the draft packs and the buff packs, the components, i.e., the steel plates and elastomer pads, are stacked vertically, alternating the cast steel plates and elastomer pads. For the draft pack, these components are stacked inside a yoke, or casing. Each steel plate with an elastomer pad positioned in the middle of the plate is considered an elastomer unit. “The edges of the plates extending around the elastomeric pads are configured so that the plates can nest with each other, and at full compression the edges of the plates contact one another to prevent over compression of the individual elastomeric pads.” See Patent No. 10,308,263 B1 (June 4, 2019). Professionally trained personnel using specially designed electro-mechanical and hydraulic presses carry out the assembly process in Mexico. During the assembly, the components are compressed together to extreme levels of compression – approximately 400,000 psi of pressure for the draft pack, and 700,000 psi. of pressure for the buff pack. The assembly process also includes necessary welding of the buff packs center bolt and nut. The draft packs and buff packs are ultimately connected by Strato’s customers into a housing in the railcar and attached to the coupler that connects the railcars together forming a string of railcars. The draft packs and buff packs form a high-capacity draft/buff system for use in connecting freight railcars. Couplers are separately provided by Strato to its customers, and then assembled when building the freight railcar. You suggest classification of the assembled draft packs and buff packs in subheading 8607.30.10, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Parts of railway or tramway locomotives or rolling stock: Hooks and other coupling devices, buffers, and parts thereof: For vehicles of heading 8605 or 8606.” You believe that the primary non-originating steel components, i.e., the cast steel plates and the cast steel yoke or casing, are classifiable in subheading 7325.99.50, HTSUS, as “Other cast articles of iron or steel, other, other, other.” As for the minor non-originating steel components, i.e., the rod or bolt, and the nut, you believe these components are classifiable in subheading 7318.15, HTSUS, as “screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Threaded articles: Other screws and bolts, whether or not with their nuts or washers.” ISSUES: Whether the draft packs and buff packs are classifiable in subheading 8607.30.10, HTSUS), as “Parts of railway or tramway locomotives or rolling stock: Hooks and other coupling devices, buffers, and parts thereof: For vehicles of heading 8605 or 8606.” What is the country of origin of the draft packs and buff packs for purposes of section 301 and for country of origin marking? Whether the draft packs and buff packs qualify for preferential tariff treatment under the USMCA. LAW AND ANALYSIS: Classification You submit that the cast steel plates and the cast steel yoke or casing are classified in subheading 7325.99.50, HTSUS, as “Other cast articles of iron or steel, other, other, other.” Further, you submit that the other non-originating steel components, i.e., the rod or bolt, and nut, are classified in subheading 7318.15, HTSUS, as “screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Threaded articles: Other screws and bolts, whether or not with their nuts or washers.” And finally, you submit that the finished draft packs and buff packs are classified in subheading 8607.30.10, HTSUS) which provides for “Parts of railway or tramway locomotives or rolling stock: Hooks and other coupling devices, buffers, and parts thereof: For vehicles of heading 8605 or 8606.” We agree with you that the finished draft packs and buff packs are classified in subheading 8607.30.1000, HTSUS, and that the bolt and nut are classified in subheading 7318.15, HTSUS. However, we disagree with you regarding the classification of the steel plates and casing. These components are identifiable as parts of the draft packs and buff packs. In Brother International Corporation v. United States, 26 C.I.T. 867, 871 (2002), the Court of International Trade stated, with regard to the classification of parts: . . . [A]n imported item is classifiable as a part if it passes either of two tests: (1) it is an “integral, constituent, or component part, without which the article to which it is joined, could not function as such article,” [Bauerhin Technologies Limited Partnership v. United States, 110 F.3d 774, 779 (Fed. Cir. 1997)] (quoting United States v. Willoughby Camera Stores, Inc., 21 C.C.P.A. 322, Treas. Dec. 46851(1933)), or (2) it is “dedicated solely for use with another article.” Bauerhin, 110 F.3d at 779 (citing United States v. Pompeo, 43 C.C.P.A. 9 (1955)). The plates of the draft pack are somewhat smaller than the plates of the buff pack and are designed to fit inside the yoke and prevent over compression of the elastomeric pads due to the plate edges coming into contact at a certain compression point. See Patent No. 10,308,263 B1 (June 4, 2019) wherein it states that “[p]ads in the buff stack may have the same general shape as pads in the draft stack but they are scaled larger.” As these plates and the draft yoke are specially designed for use in the draft packs and buff packs and essential to the production and use of these goods, the plates and draft yoke are parts of buffers and classified in subheading 8607.30.10, HTSUS. Origin 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 30

Classification You submit that the cast steel plates and the cast steel yoke or casing are classified in subheading 7325.99.50, HTSUS, as “Other cast articles of iron or steel, other, other, other.” Further, you submit that the other non-originating steel components, i.e., the rod or bolt, and nut, are classified in subheading 7318.15, HTSUS, as “screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Threaded articles: Other screws and bolts, whether or not with their nuts or washers.” And finally, you submit that the finished draft packs and buff packs are classified in subheading 8607.30.10, HTSUS) which provides for “Parts of railway or tramway locomotives or rolling stock: Hooks and other coupling devices, buffers, and parts thereof: For vehicles of heading 8605 or 8606.” We agree with you that the finished draft packs and buff packs are classified in subheading 8607.30.1000, HTSUS, and that the bolt and nut are classified in subheading 7318.15, HTSUS. However, we disagree with you regarding the classification of the steel plates and casing. These components are identifiable as parts of the draft packs and buff packs. In Brother International Corporation v. United States, 26 C.I.T. 867, 871 (2002), the Court of International Trade stated, with regard to the classification of parts:. . . [A]n imported item is classifiable as a part if it passes either of two tests: (1) it is an “integral, constituent, or component part, without which the article to which it is joined, could not function as such article,” [Bauerhin Technologies Limited Partnership v. United States, 110 F.3d 774, 779 (Fed. Cir. 1997)] (quoting United States v. Willoughby Camera Stores, Inc., 21 C.C.P.A. 322, Treas. Dec. 46851(1933)), or (2) it is “dedicated solely for use with another article.” Bauerhin, 110 F.3d at 779 (citing United States v. Pompeo, 43 C.C.P.A. 9 (1955)).The plates of the draft pack