H346628

H346628 August 15, 2025 OT:RR:CTF:VS H346628 RMC CATEGORY: Origin Robert Stelzer Safety Power America, Inc. 575 South Mansfield St. Ypsilanti, MI 48197 RE: Country of Origin and USMCA Eligibility of the ecoCUBE Air Purification Device Dear Mr. Stelzer: This is in response to your correspondence of March 16, 2025, in which you ask U.S. Customs and Border Protection (“CBP”) to address the country of origin of the ecoCUBE air purification device under the substantial transformation standard and its eligibility for preferential tariff treatment under the United States-Mexico-Canada Agreement (“USMCA”). Your request, submitted as an electronic ruling request, was forwarded to this office from the National Commodity Specialist Division for response. We determined that certain information submitted in connection with this internal advice request should be treated as confidential. Therefore, pursuant to the requirements of 19 C.F.R. §177.2(b)(7), the information contained within brackets and all attachments to this internal advice request, forwarded to our office, will not be released to the public and will be withheld from published versions of this decision. FACTS: The good at issue is the ecoCUBE air purification device for large combustion engines. Like a catalytic converter in a vehicle, the ecoCUBE is designed to meet emissions standards for large internal combustion engines in industrial applications such as back-up power generators. According to the information provided, Safety Power America, Inc. produces the ecoCUBE at its facilities in Canada. You state that it is classified in subheading 8421.32, Harmonized Tariff Schedule of the United States (“HTSUS”). In your submission, you explain that the ecoCUBE consists of three major components: (1) the SCR air purification catalyst; (2) the DPF air purification catalyst; and (3) the stainless-steel housing. Under the first production scenario, the SCR and DPF purification catalysts are produced in the United States and installed into a stainless-steel housing produced in Canada using U.S.-origin 1 steel. The housing is then fitted with mineral wool insulation and covered with light-gauge aluminum cladding in Canada to complete the product. Under the second scenario, the following additional steps would also occur in Canada: commodity temperature and pressure sensors are added to the housing and wired to a function box and a urea injector is bolted onto the housing. You provided the following bill of materials for the good: Material Quantity Classification Value Originating Country of Origin Name (USD) Status SCR 18 8421.32 $[ ] Originating United States Catalyst elements DPF 32 8421.32 $[ ] Originating United States Catalyst elements Stainless 7,500 7219.21 $[ ] Originating United States Steel pounds Stainless 2,100 7219.22 $[ ] Originating United States Steel pounds Insulation 496 6806.10 $[ ] Non- China originating Cladding 496 7606.12 $[ ] Non- China originating Gaskets 6815.13 6 $[ ] Originating United States Nuts, 7318.15 350 $[ ] Originating Canada bolts, washers Sensors 9026.90 6 $[ ] Non- Various originating In your ruling request, you request a determination of whether the ecoCUBE qualifies for preferential tariff treatment under the USMCA and seek confirmation “under CBP’s substantial transformation test . . . on whether the product remains of U.S. origin or shifts to Canadian origin under [the two scenarios].” ISSUES: I. Whether the good is eligible for preferential tariff treatment under the USMCA when it is imported from Canada into the United States. II. What is the country of origin of the merchandise under the substantial transformation standard? 2 LAW AND ANALYSIS: I. USMCA The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. § 4511(a)). General Note (“GN”) 11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good is an originating good for purposes of the USMCA. GN 11(b) states: For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a “good originating in the territory of a USMCA country” only if— (i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries; (ii) the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials; (iii) the good is a good produced entirely in the territory of one or more USMCA countries using nonoriginating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o)); or … Here, the good will be produced in Canada using originating and non-originating materials (namely, materials of subheadings 6806.10, 7606.12, and 9026.90, HTSUS). Therefore, the merchandise will not qualify as originating pursuant to GN 11(b)(i) or (ii). We must therefore consider whether the merchandise qualifies as originating pursuant to GN 11(b)(iii). For a good of subheading 8421.32, HTSUS, the applicable rule of origin in GN 11(o)/84.70 requires: (A) A change to subheadings 8421.19 through 8421.39 from any other heading; or (B) A change to subheadings 8421.19 through 8421.39 from subheadings 8421.91 through 8421.99, whether or not there is also a change from any other heading, provided there is a regional value content of not less than: (1) 60 percent where the transaction value method is used; or (2) 50 percent where the net cost method is used. 3 Here, you have provided the information necessary to apply the tariff shift rule in GN 11(o)/84.70(A). Because no non-originating materials of heading 8421 are used in the production of the ecoCUBE, the goods will qualify as originating pursuant to GN 11(o)/84.70(A) and, provided that all other requirements are met, they will be eligible for preferential tariff treatment under the USMCA when imported into the United States from Canada. II. Substantial Transformation 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 order to determine whether a substantial transformation has occurred, CBP considers the totality of the circumstances and makes such determinations on a case-by-case basis. CBP has stated that a new and different article of commerce is an article that has undergone a change in commercial designation or identity, fundamental character, or commercial use. A determinative issue is the extent of the operations performed and whether the materials lose their identity and become an integral part of the new article. 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). In National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993), sockets and flex handles were either cold formed or hot forged into their final shape, speeder handles were reshaped by a power press after importation, and the grip of the flex handles were knurled in the United States. The imported parts were then heat treated which strengthened the surface of the steel, and cleaned by sandblasting, tumbling, and/or chemical vibration before being electroplated. In certain instances, various components were assembled together which the court stated required some skill and dexterity

I. USMCA The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. § 4511(a)). General Note (“GN”) 11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good is an originating good for purposes of the USMCA. GN 11(b) states: For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a “good originating in the territory of a USMCA country” only if— (i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries; (ii) the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials; (iii) the good is a good produced entirely in the territory of one or more USMCA countries using nonoriginating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o)); or … Here, the good will be produced in Canada using originating and non-originating materials (namely, materials of subheadings 6806.10, 7606.12, and 9026.90, HTSUS). Therefore, the merchandise will not qualify as originating pursuant to GN 11(b)(i) or (ii). We must therefore consider whether the merchandise qualifies as originating pursuant to GN 11(b)(iii). For a good of subheading 8421.32, HTSUS, the applicable rule of origin in GN 11(o)/84.70 requires: (A) A change to subheadings 8421.19 through 8421.39 from any other heading; or (B) A change to subheadings 8421.19 through 8421.39 from subheadings 8421.91 through 8421.99, whethe