United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1991 HQ Rulings > HQ 0555185 - HQ 0555425 > HQ 0555360

Previous Ruling Next Ruling


HQ 555360


June 13, 1990

CLA-2 CO:R:C:V DSN

CATEGORY: CLASSIFICATION

Paul E. Linet, Esq.
75 Federal Street, 18th floor
Boston, Massachusetts 02110

RE: GSP Treatment of Incandescent Projection Lamps

Dear Mr. Linet:

This is in response to your letter of April 3, 1989, on behalf of GTE Products Corporation ("manufacturer"), in which you request a ruling that certain incandescent projection lamps the manufacturer produces in Mexico are entitled to duty-free treatment under the Generalized System of Preferences (GSP) (19 U.S.C. 2461-2466). Your request for a tariff classification ruling for the lamps under the Harmonized Tariff Schedule of the United States (HTSUS) has been referred to the General Classification Branch, with the request that they respond directly to you. For purposes of this ruling, we assume that you are correct in your claim that the lamps are properly classified under either subheading 8539.22.80 or 8539.29.40, HTSUS. Due to the length of time this matter has been pending, we determined it advisable to answer your request based upon the information provided in your initial submission. If you have any additional information or legal arguments, you may submit a request for reconsideration.

FACTS:

You state that the incandescent projection lamps are primary light sources for several varieties of audio/visual equipment used for projecting an image onto a viewing surface, such as moving picture projectors and 35mm slide projectors, and for some specific general lighting applications.

The manufacturer will produce the projection lamps in Mexico from 30 separate imported glass and metal components. You describe the process in two steps: first, the creation of the mount assembly, and second, converting the mount assembly into a projection lamp.

The mount assembly is made by the assembly of a stem, coil, and bridge. The manufacturer produces the stem from a glass rod
approximately 8 mm in length, moly wires or metal contact pins 4 1/2 mm in length, and a glass ring approximately 2 mm in diameter. Using specialized glass working equipment, the glass ring is heated to form a wafer, and four metal pins, to which a glass bead had been previously placed at each contact point by a bead machine, are embedded in the wafer, which is then attached to the glass rod or stem. The wafer-stem is then annealed in an oven.

The coil, which is made of tungsten, is formed by bending a jig into a coil shape and subjecting it to a heat treatment. The bridge is made by imbedding four 2 mm bent wires into a 2 mm glass rod using "speciality equipment."

The stem, coil, and bridge subassemblies are then assembled with other imported components into the mount assembly. You state that with the use of jigs, fixtures and percussive welding equipment, side rods, support wires, fuse links, leads, reflectors and bridges, the various components are affixed to the wafer-stem. The weld joints are then painted with a special mixture called "getter" to prevent corrosion during the next processing stage. At this point, you state that the mount assembly is completed.

The projection lamp is then formed in what you describe as a three stage operation: blue dipping, bulb-cutting, and lamp attachment. Blue-dipping involves dipping the closed end of glass bulbs or "glass envelopes," which will be placed over the mount assembly, into a mixture of blue ceramic paint and thinner, drying the dipped bulbs in an oven, and cooling. Bulb-cutting involves cutting the bulbs to the length required for the particular lamp type. In the lamp attachment operation, the wafer stem of the mount assembly is heated, the bulb is placed over the mount assembly and sealed to the wafer-stem, the atmosphere within the bulb is evacuated by vacuum pump, and a metal base is attached to the sealed glass bulb with a heat activated cement. Some lamp types which require light center alignment are finished by hand torch soldering techniques. Some lamp types require a more extensive attachment process, which involves alignment of the light center by an optical comparator and hand soldering the bases to maintain this position to meet light output specifications.

The finished lamps are given an electrical quality test, then assigned to a packer who relights the lamps electrically, completes a visual inspection of the product, and hand packs them for shipment.

ISSUE:

Whether the mount assemblies, produced as described above from materials imported into Mexico, are substantially transformed constituent materials of the incandescent projection lamps into which they are incorporated for purposes of the GSP.

LAW AND ANALYSIS:

Under the GSP, eligible articles which are imported directly into the customs territory of the U.S. from a designated developing beneficiary country (BDC) may receive duty-free treatment if the sum of 1) the cost or value of materials produced in the BDC, plus 2) the direct costs of the processing operation in the BDC, is equivalent to at least 35% of the appraised value of the article at the time of entry. See 19 U.S.C. 2463(b).

If an article is produced or assembled from materials which are imported into the BDC, the cost or value of those materials may be counted toward the 35% value-content minimum only if they undergo a double substantial transformation in the BDC. See section 10.177, Customs Regulations (19 CFR 10.177), and Azteca Milling Co. v. United States, 703 F.Supp. 949 (CIT 1988), aff'd, Appeal No. 89-320 (Fed. Cir. 1989). That is, the cost or value of the imported materials used to produce the projection lamps may be included in the GSP 35% value-content computation only if they are first substantially transformed into a new and different article of commerce, which is itself substantially transformed into the finished lamps.

A substantial transformation occurs "when an article emerges from a manufacturing process with a name, character, or use which differs from those of the original material subjected to the process." See The Torrington Co., v. United States, 764 F.2d 1563, 1568 (Fed. Cir. 1985), citing Texas Instruments Incorporated v. United States, 681 F.2d 778, 782 (CCPA 1982).

Based upon the information you have provided, it is our opinion that the materials imported into Mexico have not undergone the requisite double substantial transformation. While it appears that production of the mount assembly substantially transforms the imported materials, it is not clear that finishing the mount assembly into the projection lamp constitutes a second substantial transformation. No evidence has been presented that the mount assembly has any use other than incorporation into the projection lamp. The processing required to form a projection lamp from the mount assembly -- encapsulating it within the blue- dipped bulb, evacuating the atmosphere, and cementing it to a
base -- does not appear to materially affect the physical character of the mount assembly. In sum, it appears that the processing required to form a projection lamp from the mount assembly is no more than the relatively minor last step necessary to complete the article for its intended use. Cf. T.D. 86-7, 20 Cust. Bull. 7 (1986).

HOLDING:

On the basis of the information presented, we find that the mount assemblies produced as described above are not substantially transformed constituent materials of the projection lamps into which they are incorporated. Therefore, the cost or value of the mount assemblies may not be counted toward the GSP 35% value-content minimum.

Sincerely,

John Durant, Director

Previous Ruling Next Ruling

See also: