N340017

N340017 June 4, 2024 OT:RR:NC:N1:102 CATEGORY: Origin Leonard Fleisig Liebherr America, Inc. 440 Monticello Avenue, Suite 2200 Norfolk, VA 23510 RE: The country of origin of slew bearings Dear Mr. Fleisig: In your letter dated May 8, 2024, you requested a country of origin ruling on slew bearings. Descriptive information was provided in your submission. The merchandise under consideration is referred to as slew bearings or slew rings. The slew bearings are described as rotational-element bearings that support heavy, slow rotating loads. The bearings consist of a four-point ball and/or roller elements situated between races that feature teeth, either in the center bore or the outside diameter. The bearings may be in single or double row configurations. In use, the teeth of the race mesh with gear drives. The applications of the slew bearings are construction machines, maritime applications, machine tools, and wind turbines. In your letter, you suggest the slew bearings are classified within heading 8482, Harmonized Tariff Schedule of the United States (HTSUS), which provides for ball or roller bearings. We disagree, as Headquarters ruling 083066 (April 6, 1989) determined that the principal function of slewing rings is the gear function completed by the teeth. The balls used in slewing rings provide a secondary function of reducing friction. Gears and gearing are provided for within heading 8483. Accordingly, the applicable subheading of the slew bearings will be 8483.90.5090, HTSUS, which provides for Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof: Toothed wheels, chain sprockets and other transmission elements presented separately; parts: Parts of gearing, gear boxes and other speed changers: Other. The general rate of duty is 2.5 percent ad valorem. 301 Trade Remedies: In regard to origin, two scenarios are provided for review. In both scenarios, the final assembly of the slew bearings occurs in Mexico. The Chinese steel rings enter Mexico in one of two forms: Ready for Hardening or Ready for Hard Turning. In the first scenario (Ready for Hardening), the rings are subject to raceway induction hardening, gear cutting, gear hardening, and drilling in Mexico. Once complete, the rings are ready for the hard turning processes in Mexico. Such processes consist of hard turning and soft spot grinding. It is mentioned that during the hard turning process the raceways of the rings are machined and hardened to final dimensions, creating raceways. The soft spot grinding creates relief from the hardening process. The final assembly of the slew bearings occurs in Mexico. Balls and/or rollers from China are situated into the rings and pressed in place. Afterwards, seals from Germany are cut to fit the bearing circumference and the joint is hot vulcanized or glued in place. Grease from Germany is then applied accordingly. Threaded screws from Germany are screwed in place as needed. Each bearing undergoes various testing and inspections, and is subsequently painted, surfaced cleaned, and surface treated. In the second scenario, Chinese steel rings undergo the above-described ready for hard turning processes (raceway induction hardening, gear cutting, gear hardening, and drilling) in China and enter Mexico, in Ready for Hard Turning form. The rings described as Ready for Hard Turning undergo hard turning and soft spot grinding. The hard turning process the raceways of the rings are machined and hardened to final dimensions, creating raceways. The soft spot grinding creates relief from the hardening process. Afterwards, the rings are sent forward for final assembly in Mexico, in which the processes described in the final assembly of first scenario are also completed. The "country of origin" is defined in 19 CFR 134.1(b) 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 this part." 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). 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 the instance case, the final assembly processes that occur in Mexico are rather simple and do not constitute a substantial transformation. The processes of placing, pressing, gluing and screwing components to each other are not considered to be complex. The final assembly processes performed in Mexico do not change the shape, character or predetermined use of the inputs. Instead, we rely on the country in which the rings are transformed into a gear, which is the essence of the slew bearing, as the gear teeth complete the principal function of the slew bearing. In scenario one, it is noted that the grinding of the ring’s teeth occurs in Mexico. In scenario two, the grinding of the ring’s teeth occurs in China. Thus, the country of origin in scenario one for 301 Trade Remedies is Mexico. The country of origin in scenario two for 301 Trade Remedies is China. For the Chinese slew bearings, please note that pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 8483.90.5090, HTSUS, unless specifically excluded, are subject to an additional 25 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.03, in addition to subheading 8483.90.5090, HTSUS, listed above. Eligibility for preferential treatment under the USMCA: In your letter, you inquire whether the slew bearings are eligible for preferential treatment under the 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, 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, in relevant part: For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country…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 non-originating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o)); …. Here, the slew bearings consist exclusively of non-originating materials and are not considered a good wholly obtained or produced entirely in a USMCA country under GN 11(b)(i). Moreover, under GN 11(b)(ii), the slew bearings are not a good produced entirely in Mexico exclusively from originating materials. Therefore, we must determine whether the non-orig

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 sandra.martinez@cbp.dhs.gov.Sincerely, Steven A. Mack Director National Commodity Specialist Division