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HQ 083455

September 6, 1989

CLA-2 CO:R:C:G 083455 AJS


TARIFF NO: 8482.20.0010; 9802.00.80

Richard G. Seley
Rudolph Miles & Sons, Inc.
4950 Gateway East
P.O. Box 144
El Paso, Texas 79942

RE: Steel tapered roller bearings assembled in Mexico

Dear Mr. Seley:

Your request of December 7, 1988, for a ruling on the tariff classification of steel tapered roller bearings has been referred to this office for a reply.


The merchandise consists of steel tapered roller bearings which will be assembled in Mexico. The bearings are composed of a completely finished cone (inner ring) manufactured in Romania, completely finished rollers from the United States, retainers (or cages) for the rollers which are to be manufactured in either the United States or Mexico, and a completely finished cup (outer ring) from Romania. These components will be assembled by means of force fitting and the completed article will then be imported into the U.S.

What is the classification of steel tapered roller bearings in which two of the components are manufactured in Romania, another component is of U.S. origin, the last component may be from the U.S. or Mexico, where the assembly will take place in Mexico. In addition, what is the proper marking of this type of bearing under these circumstances.


Classification of products under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is governed by
the General Rules of Interpretation (GRI's). GRI 1 provides that classification is determined first in accordance with the terms of the headings and any relative section or chapter notes.

Subheading 8482.20.0010, HTSUSA, provides for "[t]apered roller bearings, including cone and tapered roller assemblies. [c]up and cone assemblies entered as a set." The bearings in question fit this description and are classifiable under this subheading.

However, since these bearings are to be assembled in Mexico and consist of components from both Romania and the U.S., the question then arises regarding which country these bearings originated from in order to determine which column duty rate is applicable. If these bearings are products of Mexico, they would be subject to the General Column 1 rate of 6.5 percent ad valorem. But if they are products of Romania, then they would be subject to the Column 2 rate of 67 percent ad valorem.

In general, the country of origin of an article, for U.S. tariff purposes, is the country in which the last substantial transformation of the article takes place. In this case, the bearing components from Romania would remain products of that country unless the assembly in Mexico results in an article having a name, character, or use different from the original components. Anheuser-Busch Brewing Association v. United States, 207 U.S. 556 (1908), at page 563. In order to make this determination, it is necessary to address the substantiality of the processing performed in Mexico. Uniroyal, Inc. v. United States, 3 C.I.T. 220 (1982); Belcrest Linens v. United States, Appeal No. 84-734 (1984); and Data General Corporation v. United States, 4 C.I.T. 182.

The term "substantial transformation" is a term applied to describe the nature of the change that must occur as a result of processing in order to change the country of origin of an article for various tariff purposes. For example, this term is used in the Customs Regulations concerning marking (Section 134.35), the eligibility of goods under item 807.00 (9802.00.80 HTSUSA) (Section 10.14), and preferential tariff provisions such as the Generalized System of Preferences and the Caribbean Basin Initiative (Section 10.177 and 10.196).

This case essentially involves the assembly of four com- ponents into a tapered roller bearing assembly. In the bearing industry, the three most crucial components of the bearing are the cup, cone, and rollers. In this case, the cup and cone are manufactured in Romania and arrive in Mexico as completely fin- ished components. The rollers are manufactured in the U.S. and arrive in Mexico as completely finished components. The fourth
component is the cage which is to be manufactured in either the U.S. or Mexico. The cage is a secondary component and not subject to the tight manufacturing specifications required of the other components.

The assembly of one cone, cage, rollers, and cup would not entail the type of processing required to meet the substantial transformation test. No new merchandise is created which possesses a different name, character or use than that of the original components. The only processing that takes place is the simple assembly of four finished components to create a tap- ered roller bearing. Each of these components is specifically designed for this assembly and only intended to be one component in the finished bearing. In sum, this process seem to be no more than a simple assembly which does not accomplish the type of substantial transformation required to allow the merchandise to be considered a product of Mexico. Since the assembled product cannot be considered of Mexican origin, the country of origin would remain that of the place where the components were last substantially transformed. In this case the country of origin would be Romania.

Subheading 9802.00.80, HTSUSA, provides a partial duty exemption for:

[a]rticles assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process such as cleaning, lubricating, and painting.

An article entered under this tariff provision is subject to a duty upon the full value of the imported assembled article, less the cost or value of the U.S. components assembled therein, provided there has been compliance with the documentation requirements of section 10.24, Customs Regulations (19 CFR 10.24).

Assembly operations for purpose of HTSUSA subheading 9802.00.80 are interpreted at section 10.16(a), Customs Regulations (19 CFR 10.16(a)), which specifically enumerates force fitting as an acceptable means of assembly.

In the instant case, the imported articles will be eligible for the partial duty exemption available under HTSUSA subheading 9802.00.80. The rollers are finished products of the U.S. which are exported for acceptable assembly operations with other
components. The U.S. components do not lose their physical identity in the assembly operation and an examination of the sample submitted shows that the U.S. components are not otherwise advanced in value or improved in condition except by the assembly operation. Accordingly, an allowance in duty may be made under this tariff provision for the cost or value of the rollers and, if manufactured in the U.S., the cages, upon compliance with the documentary requirements of 19 CFR 10.24.

Your letter also requests a country of origin marking determination. Inasmuch as the roller bearings assemblies would be eligible for treatment under subheading 9802.00.80, HTSUSA, section 10.22 of the Customs regulations applies to their marking. For the purposes of country of origin marking, the country of assembly (i.e. Mexico) is the country of origin and the following markings would be acceptable:

(1) Assembled in Mexico
(2) Assembled in Mexico from Romanian and U.S. components.

Because of the inclusion of the U.S. address on the box, the requirements of section 134.46 of the Customs regulations apply. This section requires the marking to appear in close proximity to the address and in comparable size letters.

The marking of the box alone is sufficient if (1) the district director is satisfied that the article will reach the ultimate purchaser in the marked box, and (2) the article contains no misleading markings. Otherwise, the article itself must also be marked.


The steel tapered roller bearings are classifiable in sub- heading 8482.20.0010, HTSUSA. They are considered to be products of Romania and are dutiable at the Column 2 rate of 67 percent ad valorem. However, allowances in duty may be made under subheading 9802.00.80, for the cost or value of the U.S. components assembled into bearings upon compliance with 19 CFR 10.24.

For country of origin marking requirements, Mexico is the country of origin. "Assembled in Mexico" or "Assembled in Mexico from Romanian and U.S. components" is an acceptable marking.


John Durant, Director
Commercial Rulings Division

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