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NY K80184

November 20, 2003
CLA-2-84:RR:NC:MM:106 K80184


TARIFF NO.: 8424.89.7090

Mr. Arthur Purcell
Sandler, Travis & Rosenberg, P.A.
551 Fifth Avenue
New York, NY 10176

RE: The tariff classification and country of origin marking of nebulization system units from France

Dear Purcell:

In your letter dated October 22, 2003, on behalf of Quaetech LLC, you requested a tariff classification and country of marking ruling. Your correspondence was submitted as an addendum to your original request of September 29, 2003 which was returned to you for additional information.

The products at issue are known as Nebulization System Units (NSU). There are currently two NSU models, the K50 Classic and the K50 Compact. The NSU will be used primarily in air purification and olfactory marketing applications. Both units contain a vented outer case of metal or molded plastic and a variety of internal components, including a nebulization head, a plastic liquid reservoir, a ventilator, power supply, regulator, power switch, air compressor, air filter and timer. The nebulization head, said to be the key component in cost and function, allows small liquid particles to be reduced in size so that they behave like a gas. In operation the NSU nebulizes a liquid fragrance or disinfectant and disperses it in to the surrounding air.

You suggest that that the NSUs are classified under subheading 8421.39.80, Harmonized Tariff Schedule of the United States (HTS), as other purifying machinery and apparatus for gases (air). You state that the principal function of the subject article in its imported condition will be air purification, and that use will be the principal use of the article in terms of anticipated marketing and commercial application.

The application or purpose of the unit depends upon the liquid placed in the unit’s reservoir. If a disinfectant or decontaminant is placed in the reservoir, it can be used for air purification. If a fragrance or perfume is placed in the reservoir, it can be used as a fragrance dispenser or deodorizer. The function of the unit is at all times to spray.

The Explanatory Notes to Chapter 84 of the HTS provide us with the General Arrangement of the Chapter in part (B) on page 1394. Item (2) indicates that headings 8402 to 8424 cover machines and apparatus which are classified mainly by reference to their function, and regardless of the field of industry in which they are used. Regardless of whether the NSUs are used for the purpose of air purification or deodorizing, the function performed is a mechanical dispersing of a liquid.

The applicable subheading for the nebuilization system units will be 8424.89.7090, HTS, which provides for other mechanical appliances for projecting, dispersing or spraying liquids or powders. The rate of duty will be 1.8 percent.

You also asked whether the proposed marking "Made in France" is an acceptable country of origin marking for the imported NSUs. A marked sample was not submitted with your letter for review. The NSUs will be marked at the time of manufacture in France with a metal plate that will be permanently secured to the exterior of the NSUs. The plate, measuring 2” x 3.5”, will contain the words “Made in France” and the name “Prolitec”, a U.S. address, telephone numbers, internet information and product codes. The name of the country of origin will be in a type size equal to or greater the U.S. address.

You state that the majority of the components are manufactured in France but several components, including an axial fan, air compressor, timer, outer case and air filter are manufactured elsewhere, other than the United States, sourced in France and assembled with the French-made components in France. You claim that the assembly/manufacturing process of the NSU in France involves a series of complex steps which will be performed by trained technicians and electricians.

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. By enacting 19 U.S.C. 1304, Congress intended to ensure that the ultimate purchaser would be able to know by inspecting the marking on the imported goods the country of which the goods are the product. United States v. Friedlaender & Co., 27 C.C.P.A. 297, 302 C.A.D. 104 (1940).

Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. "Country of origin" is defined in section 134.1(b), Customs Regulations (19 CFR 134.1(b)), as [t]he 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.

A substantial transformation occurs "when 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. 152, 681 F.2d 778 (1982) (cited with approval in Torrington Co. v. United States, 764 F. 2d 1563, 1568 (1985)). The issue of whether a substantial transformation occurs is determined on a case by case basis.

In determining whether the processing operations constitute a substantial transformation, the issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article. If the manufacturing or combining process is merely a minor one which leaves the identity of the article intact, a substantial transformation has not occurred. See, Uniroyal Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026 (CIT 1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983). Assembly operations which are minimal or simple, as opposed to complex or meaningful, will generally not result in a substantial transformation. See, Customs Service Decision (C.S.D.) 80 111, C.S.D. 89 129, and C.S.D. 90-51.

Where, as in the case of the NSUs, a number of aggregated components are subjected to a series of operations, many of them complex, which must be performed by skilled technicians (i.e., specialized mechanics, electricians), the assembly operations in France are sufficient to effect a substantial transformation of the “foreign” component parts into an article with a new name, character and use – a nebulization system unit. Therefore, the proposed marking of imported NSUs, as described above, is conspicuously, legibly and permanently marked in satisfaction of the marking requirements of 19 U.S.C. 1304 and 19 CFR Part 134 and is an acceptable country of origin marking for the imported NSUs.

This ruling is being issued under the provisions of Part 177 of the Customs 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, contact National Import Specialist Patrick Wholey at 646-733- 3013.


Robert B. Swierupski

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