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HQ 087462


OCT 22 1990

CLA-2:CO:R:C:G 087462 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: None

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

RE: Pillow Block

Dear Mr. Seley:

In your letter of June 22, 1990, on behalf of Emerson Power Transmission, Corp., Ithaca, N.Y., you inquire as to the tariff status of pillow blocks assembled in Mexico from components of U.S., Mexican and Japanese origin. A sample was submitted. Our ruling follows.

FACTS:

Ball bearings (consisting of antifriction balls separated by plastic elements enclosed in an inner and outer race) of Japanese origin and grease nipples called Zerk fittings, and pressure sensitive name plates, both of U.S. origin, are shipped to Mexico. In Mexico, a block housing is cast and machined to accommodate the bearing's outer race, and a hole is drilled and tapped for the grease nipple. The bearing and one nipple are then assembled into the housing, and the name plate applied. The resulting pillow block ball bearing assembly or housed bearing will be used in heavy machinery to support a rotating journal, shaft or other part.

The bearings represent approximately 38 percent and the U.S. origin components approximately 4 percent of the estimated cost or value of the completed article. The pillow block housing represents approximately 17 percent of the cost or value of the completed article, while the Mexican assembly process, including certain fixed and variable overhead costs, represents 41 percent of the cost or value of the final article.

ISSUE:

Whether the ball bearing of Japanese origin has been substantially transformed in Mexico so that the pillow block or housed bearing assembly, when returned to the Customs territory, will be regarded as a product of Mexico for duty rate purposes, for country of origin marking purposes, and for purposes of the antidumping duty order on Japanese ball bearings.

LAW AND ANALYSIS:

General Rule of Interpretation (GRI 1), Harmonized Tariff Schedule of the United States Annotated (HTSUSA), states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided the notes do not require otherwise, according to GRIs 2 through 6. Under the authority of GRI 1, upon return to the Customs territory the pillow block assembly will be provided for in heading 8483, as bearing housings, housed bearings and plain shaft bearings. We agree with your conclusion that actual classification will be under the provision for housed bearings incorporating ball bearings, in subheading 8483.20.8040, HTSUSA.

In order for the ball bearing of Japanese origin to be considered substantially transformed in Mexico, so as to be regarded as a product of Mexico for purposes of the antidumping duty order, the evidence must show that the processing or assembly in Mexico will result in a product other than or materially different from its constituent components. That is, a new and different article of commerce must emerge from Mexico, one having a new name, character, or use. Anheuser- Busch Brewing Association v. United States, 207 U.S. 556 (1908). A mere change in a product's name, without more, is a relatively unimportant consideration in most cases. As to character and use, however, there must be evidence to show that the processing in Mexico transforms the Japanese ball bearing in such a way that it is no longer the essence of the pillow block.

A bearing block or pillow block is an iron casting or housing that supports a journal shaft or other part as it turns on the balls of the bearing within. It functions as an anti- friction device to convert sliding friction to rolling friction. The very essence of the assembled article is the ball bearing which is clearly identifiable in the assembly and is the actual anti-friction element. The block or housing serves merely to secure the bearing to a machine and to support
the bearing and shaft as the shaft rotates. In our opinion, the ball bearing has not lost its identifying characteristics by virtue of having been assembled in the pillow block. We conclude, therefore, that the ball bearing of Japanese origin has not been substantially transformed by the assembly operation in Mexico. The pillow block entering the Customs territory will be considered a product of Japan for tariff purposes.

We are informed that Antidumping Duty Order A-588-804 covers not only antifriction bearings mounted or unmounted (other than tapered roller bearings) and parts thereof, from Japan, but encompasses ball bearing type pillow blocks and parts thereof as well. You may confirm this by writing the Office of Antidumping Investigations, Import Administration, Department of Commerce, Washington, D.C. 20230.

HOLDING:

Under the authority of GRI 1, the pillow block or housed bearing incorporating roller bearings, a product of Mexico, is provided for in heading 8483. It is classifiable in subheading 8483.20.4080, HTSUSA, dutiable at the rate of 5.7 percent ad valorem.

This ruling applies for duty rate purposes, for country of origin marking purposes, and for purposes of the antidumping duty order on antifriction bearings from Japan.

The question relating to the partial exemption from duty allowed by heading 9802.00.80 will be answered separately.

Sincerely,

John Durant, Director
Commercial Rulings Division

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