Notice of Issuance of Final Determination Concerning a Lift Unit for an Overhead Patient Lift System, 31803-31805 [2010-13497]
Download as PDF
<![CDATA[
Federal Register / Vol. 75, No. 107 / Friday, June 4, 2010 / Notices
srobinson on DSKHWCL6B1PROD with NOTICES
inconsistent with the GRAS
determination; and
—The basis for concluding, in light of
the data and information submitted, that
there is consensus among experts
qualified by scientific training and
experience to evaluate the safety of
substances added to food that there is
reasonable certainty that the substance
is not harmful under the intended
conditions of use.
Æ For a GRAS determination through
experience based on common use in
food, such summary should include:
—A comprehensive discussion of, and
citations to, generally available data and
information that the notifier relies on to
establish safety, including documented
evidence of a substantial history of
consumption of the substance by a
significant number of animals. Where a
substance is intended for use in the food
of an animal used to produce human
food, this should include a
comprehensive discussion of, and
citations to, generally accepted
scientific data, information, methods, or
principles about both safety to the target
animal and human food safety. The
scientific data, information, methods, or
principles provided should be sufficient
to show that the substance is generally
recognized among qualified experts to
be safe for animals consuming food
containing the substance as well as to
humans consuming food derived from
such animals (i.e., under its intended
conditions of use);
—A comprehensive discussion of any
reports of investigations or other
information that may appear to be
inconsistent with the GRAS
determination;
—The basis for concluding, in light of
the data and information submitted, that
there is consensus among experts
qualified by scientific training and
experience to evaluate the safety of
substances added to food that there is
reasonable certainty that the substance
is not harmful under the intended
conditions of use.
IV. How FDA Will Administer Notices
Under the Pilot Program
In general, the agency will administer
the notices under the pilot program as
described in proposed § 570.36(d)
through (f) of the 1997 proposed rule, as
follows:
1. Within 30 days of receipt of the
notice, FDA intends to acknowledge
receipt of the notice by informing the
notifier in writing.
2. Under the 1997 proposed rule, FDA
would respond to the notifier in writing
within 90 days of receipt of the notice
either that the notice provides a
sufficient basis for the GRAS
VerDate Mar<15>2010
16:01 Jun 03, 2010
Jkt 220001
determination or that FDA has
identified questions as to whether the
intended use of the substance is GRAS.
Due to resource limitations in the
animal food program, it is unlikely that
CVM will be able to evaluate and
respond to notices within the 90-day
timeframe contained in the 1997
proposed rule. CVM will therefore
respond to notifications of GRAS
determinations in its pilot program as
quickly as resources permit.
• Any GRAS determination claim
submitted as part of the pilot program
shall be immediately available for
public disclosure on the date the notice
is received. All remaining data and
information in the notice shall be
available for public disclosure, in
accordance with 21 CFR part 20, on the
date the notice is received.
• For each notice of GRAS
determination submitted under the pilot
program, the following information
shall be readily accessible for public
review and copying:
Æ A copy of the submitted GRAS
determination claim,
Æ A copy of any letter issued by the
agency, as described in paragraph 2 of
this section.
Æ A copy of any subsequent letter
issued by the agency regarding such
notice.
V. Paperwork Reduction Act of 1995
The collections of information in this
notice are subject to review by the
Office of Management and Budget
(OMB) under the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501–3520), and
have been previously approved by
OMB. OMB originally approved
Paperwork Reduction Act (PRA)
burdens for GRAS notification under the
1997 proposed rule under OMB control
number 0910–0342. The original OMB
approval covered the collections of
information in both proposed 21 CFR
170.36 and 570.36; however, only
CFSAN operated a GRAS notification
program for human food under the
original OMB PRA approval. Extension
of the original OMB PRA approval for
GRAS notification was granted by OMB
on August 24, 2009, under OMB control
number 0910–0342.
As with the human food GRAS
notification program administered by
CFSAN, which has operated for several
years, the animal food pilot program,
which will be administered by CVM,
will be based on the notification
procedures announced in the 1997
proposed rule. The provisions for GRAS
notification under proposed §§ 170.36
and 570.36 for human and animal food,
respectively, are virtually identical and
therefore the same number of hours per
PO 00000
Frm 00061
Fmt 4703
Sfmt 4703
31803
response were estimated for reporting
(150 hours) and recordkeeping (15 hours
per record) burdens for both proposed
sections under the original and
extended OMB PRA approvals. Because
CFSAN’s GRAS program has
successfully operated under these PRA
estimates for several years, FDA believes
these burden estimates remain accurate
for CVM’s GRAS pilot program.
FDA’s estimate of the annual number
of GRAS determination notices that will
be received by CVM in the extended
OMB PRA approval (5) was revised
downward from the original PRA
approval (10). This revision was based
on the actual number of GRAS notices
received by CFSAN from 1998 to 2008,
which was lower than anticipated and
caused CFSAN to also revise downward
its estimate in the extended PRA
approval. The revised estimate in the
extended PRA approval reflects FDA’s
best judgment at this time as to the
number of notices CVM will receive
annually through this pilot program.
CVM believes that the PRA estimates
in the extended PRA approval cover
CVM’s GRAS notice program.
Dated: May 26, 2010.
Leslie Kux,
Acting Assistant Commissioner for Policy.
[FR Doc. 2010–13464 Filed 6–3–10; 8:45 am]
BILLING CODE 4160–01–S
DEPARTMENT OF HOMELAND
SECURITY
U.S. Customs and Border Protection
Notice of Issuance of Final
Determination Concerning a Lift Unit
for an Overhead Patient Lift System
AGENCY: U.S. Customs and Border
Protection, Department of Homeland
Security.
ACTION: Notice of final determination.
SUMMARY: This document provides
notice that U.S. Customs and Border
Protection (‘‘CBP’’) has issued a final
determination concerning the country of
origin of a lift unit for an overhead
patient lift system. Based upon the facts
presented, CBP has concluded in the
final determination that Sweden is the
country of origin of the lift unit for
purposes of U.S. government
procurement.
DATES: The final determination was
issued on May 28, 2010. A copy of the
final determination is attached. Any
party-at-interest, as defined in 19 CFR
177.22(d), may seek judicial review of
this final determination within July 6,
2010.
E:\FR\FM\04JNN1.SGM
04JNN1
31804
Federal Register / Vol. 75, No. 107 / Friday, June 4, 2010 / Notices
FOR FURTHER INFORMATION CONTACT:
Heather K. Pinnock, Valuation and
Special Programs Branch: (202) 325–
0034.
Notice is
hereby given that on 2010, pursuant to
subpart B of part 177, Customs
Regulations (19 CFR part 177, subpart
B), CBP issued a final determination
concerning the country of origin of the
lift unit which may be offered to the
U.S. Government under an
undesignated government procurement
contract. This final determination, in
HQ H100055, was issued at the request
of Hill-Rom Company, Inc., under
procedures set forth at 19 CFR part 177,
subpart B, which implements Title III of
the Trade Agreements Act of 1979, as
amended (19 U.S.C. 2511–18). In the
final determination, CBP concluded
that, based upon the facts presented, the
lift unit, assembled in Sweden from
parts made in a non-TAA country and
in Sweden, is substantially transformed
in Sweden, such that Sweden is the
country of origin of the finished article
for purposes of U.S. government
procurement.
Section 177.29, Customs Regulations
(19 CFR 177.29), provides that notice of
final determinations shall be published
in the Federal Register within 60 days
of the date the final determination is
issued. Section 177.30, CBP Regulations
(19 CFR 177.30), provides that any
party-at-interest, as defined in 19 CFR
177.22(d), may seek judicial review of a
final determination within 30 days of
publication of such determination in the
Federal Register.
SUPPLEMENTARY INFORMATION:
Dated: May 28, 2010.
Harold M. Singer,
Acting Executive Director, Regulations and
Rulings, Office of International Trade.
srobinson on DSKHWCL6B1PROD with NOTICES
Attachment
HQ H100055
May 28, 2010
OT:RR:CTF:VS H100055 HkP
CATEGORY: Marking
Karen A. McGee, Esq.
Linda M. Weinberg, Esq.
Barnes & Thornburg LLP
750 17th Street, N.W., Suite 900
Washington, DC 20006–4675
RE: Government Procurement; Country of
Origin of a Lift Unit for an Overhead
Patient Lift System; Substantial
Transformation
Dear Mses. McGee and Weinberg: This is
in response to your letter dated April 1, 2010,
requesting a final determination on behalf of
Hill-Rom Company, Inc., pursuant to subpart
B of part 177 of the U.S. Customs and Border
Protection Regulations (19 C.F.R. Part 177).
Under these regulations, which implement
Title III of the Trade Agreements Act of 1979
(TAA), as amended (19 U.S.C. 2511 et seq.),
VerDate Mar<15>2010
16:01 Jun 03, 2010
Jkt 220001
CBP issues country of origin advisory rulings
and final determinations as to whether an
article is or would be a product of a
designated country or instrumentality for the
purposes of granting waivers of certain ‘‘Buy
American’’ restrictions in U.S. law or practice
for products offered for sale to the U.S.
Government.
This final determination concerns the
country of origin of a lift unit for the Likorall
Overhead Patient Lift System. We note that
as a U.S. importer Hill-Rom is a party-atinterest within the meaning of 19 C.F.R.
§ 177.22(d)(1) and is entitled to request this
final determination.
FACTS:
According to the information submitted,
the Likorall Overhead Patient Lift System is
a ceiling-mounted or free-standing patient lift
system. The system is capable of lifting and
transporting patients with limited mobility,
weighing up to 550 pounds, from one part of
a room to another or from one room to
another. It can also be used for weighing and
lifting in combination with a stretcher and
for walking, standing, gait and balance
training. The system is designed to lift and
move patients safely while avoiding injuries
to caregivers.
The merchandise at issue, the Likorall lift
unit, is the motorized component of the
Overhead Patient Lift System that extends
and retracts the lift belt to which the patientsupporting sling is attached. The unit is
manufactured in 3 basic models: (1) 242,
which has a lifting capacity up to 440
pounds; (2) 243, which has a lifting capacity
up to 507 pounds; and (3) 250, which has a
lifting capacity up to 550 pounds. Models
243 and 250 come in an ‘‘ES’’ version, which
is equipped with an infrared (IR) receiver for
optional use with a remote control. Model
242 comes in the ‘‘S’’ version, which operates
only with an attached hand control, as well
as in the ES version. In addition, the 242
model has ‘‘R2R’’ versions, which feature a
contact for a transfer motor so that the patient
can be moved between two independent
overhead rail systems in separate rooms,
without the need for openings above
doorways. The lift unit was designed,
developed and engineered in Sweden. It
incorporates approximately 100 components
imported from non-TAA countries, except for
the motor, which is imported from a TAA
country and the IR remote control, which is
made in Sweden.
At the manufacturing facility in Sweden,
teams of employees assemble the lift unit in
a four segment process and perform a 25-step
final functional test under specified
conditions. The segments are: Manufacturing
the electrical motor, drum and motor package
in a 17-step process; mounting batteries and
installing the exterior covers of the drum/
motor assembly in a 5-step process;
connecting a printed circuit board assembly
(PCBA) to the motor, housed drum and
batteries in a 3-step process; and, assembling
the emergency strap, cover and end caps in
a 14-step process. The PCBA is assembled
and programmed prior to importation into
Sweden but is designed in Sweden and its
software program is written in Sweden.
During the final functional test the
electronics of the lift unit are checked and
PO 00000
Frm 00062
Fmt 4703
Sfmt 4703
the maximum load is attached to check
performance. At the conclusion of the test,
the employee performing the test must
complete a test protocol form, with the
original being provided to the customer and
a copy retained by the manufacturer in a test
log that tracks units by serial number. The
full manufacturing process takes
approximately 45 minutes and the testing
process takes approximately 15 minutes.
According to the information submitted,
the employees manufacturing the lift unit
have mechanical knowledge and skill related
to their work gained from technical
secondary education, product specific
training, and certified final functional test
training. The lift unit is also tested by an
accredited testing institute and complies
with the requirements of directives for
medical-technical Class 1 products in the
European Union (MDD 93/42/EEC).
Packaged for retail sale with the lift unit is
a hand control, which is attached by cable to
the overhead unit and is used to control
power, lifting and lowering of the lift unit’s
belt, and the moving of the lift unit along the
rails. The hand control plugs into a contact
on one of the end plates and is physically
and electrically connected to the overhead
lift unit. It is made in a non-TAA country.
An IR remote hand control (ES versions and
242 ESR2R), which can be used as an
alternative to the attached hand control is
also imported with the unit. The remote
control and the PCB it incorporates are made
in Sweden. A battery charger, into which the
wired hand control is inserted to charge the
batteries inside the lift unit, is also imported
with the lift unit. The charger is made in the
same non-TAA country as the hand control.
ISSUE:
What is the country of origin of the lift unit
for purposes of U.S. government
procurement?
LAW AND ANALYSIS:
Pursuant to Subpart B of Part 177, 19 CFR
§ 177.21 et seq., which implements Title III
of the Trade Agreements Act of 1979, as
amended (19 U.S.C. § 2511 et seq.), CBP
issues country of origin advisory rulings and
final determinations as to whether an article
is or would be a product of a designated
country or instrumentality for the purposes
of granting waivers of certain ‘‘Buy
American’’ restrictions in U.S. law or practice
for products offered for sale to the U.S.
Government.
Under the rule of origin set forth under 19
U.S.C. § 2518(4)(B):
An article is a product of a country or
instrumentality only if (i) it is wholly the
growth, product, or manufacture of that
country or instrumentality, or (ii) in the case
of an article which consists in whole or in
part of materials from another country or
instrumentality, it has been substantially
transformed into a new and different article
of commerce with a name, character, or use
distinct from that of the article or articles
from which it was so transformed.
See also 19 CFR § 177.22(a).
In determining whether the combining of
parts or materials constitutes a substantial
transformation, the determinative issue is the
E:\FR\FM\04JNN1.SGM
04JNN1
srobinson on DSKHWCL6B1PROD with NOTICES
Federal Register / Vol. 75, No. 107 / Friday, June 4, 2010 / Notices
extent of operations performed and whether
the parts lose their identity and become an
integral part of the new article. Belcrest
Linens v. United States, 573 F. Supp. 1149
(Ct. Int’l Trade 1983), aff’d, 741 F.2d 1368
(Fed. Cir. 1984). Assembly operations that are
minimal or simple, as opposed to complex or
meaningful, will generally not result in a
substantial transformation. See C.S.D.
80–111, C.S.D. 85–25, C.S.D. 89–110, C.S.D.
89–118, C.S.D. 90–51, and C.S.D. 90–97. In
C.S.D. 85–25, 19 Cust. Bull. 844 (1985), CBP
held that for purposes of the Generalized
System of Preferences (‘‘GSP’’), the assembly
of a large number of fabricated components
onto a printed circuit board in a process
involving a considerable amount of time and
skill resulted in a substantial transformation.
In that case, in excess of 50 discrete
fabricated components (such as resistors,
capacitors, diodes, integrated circuits,
sockets, and connectors) were assembled.
Whether an operation is complex and
meaningful depends on the nature of the
operation, including the number of
components assembled, number of different
operations, time, skill level required,
attention to detail, quality control, the value
added to the article, and the overall
employment generated by the manufacturing
process.
In order to determine whether a substantial
transformation occurs when components of
various origins are assembled into completed
products, CBP considers the totality of the
circumstances and makes such
determinations on a case-by-case basis. The
country of origin of the item’s components,
extent of the processing that occurs within a
country, and whether such processing
renders a product with a new name,
character, and use are primary considerations
in such cases. Additionally, factors such as
the resources expended on product design
and development, the extent and nature of
post-assembly inspection and testing
procedures, and worker skill required during
the actual manufacturing process will be
considered when determining whether a
substantial transformation has occurred. No
one factor is determinative.
CBP has held in a number of cases that
complex and meaningful assembly
operations involving a large number of
components result in a substantial
transformation. In Headquarters Ruling Letter
(HQ) H047362, dated March 26, 2009, CBP
found that 61 components manufactured in
China and assembled into ground fault
circuit interrupters (GFCIs) in Mexico in a
two-phase process by skilled workers using
sophisticated equipment were substantially
transformed in Mexico. In particular, we took
into consideration that the first phase
involved the assembly of a PCB in a 42-step
technically complex process that took 12
minutes and that the completed PCB had all
the major components necessary for the GFCI
to fulfill its function. We also took into
consideration that in the second phase the
PCB would be assembled with 29 other
components to form the GFCIs in a 43-step
process taking approximately 10 minutes,
after which the components would have lost
their individual identities and become an
integral part of the interrupters with a new
name, character and use.
VerDate Mar<15>2010
16:01 Jun 03, 2010
Jkt 220001
By contrast, assembly operations that are
minimal or simple will generally not result
in a substantial transformation. For example,
in HQ 734050, dated June 17, 1991, CBP held
that Japanese-origin components were not
substantially transformed in China when
assembled in that country to form finished
printers. The printers consisted of five main
components identified as the ‘‘head’’,
‘‘mechanism’’, ‘‘circuit’’, ‘‘power source’’, and
‘‘outer case.’’ The circuit, power source and
outer case units were entirely assembled or
molded in Japan. The head and mechanical
units were made in Japan but exported to
China in an unassembled state. All five units
were exported to China where the head and
mechanical units were assembled with
screws and screwdrivers. Thereafter, the
head, mechanism, circuit, and power source
units were mounted onto the outer case with
screws and screwdrivers. In holding that the
country of origin of the assembled printers
was Japan, CBP recognized that the vast
majority of the printer’s parts were of
Japanese origin and that the operations
performed in China were relatively simple
assembly operations.
In this case, approximately 100
components manufactured in non-TAA
countries will be assembled in Sweden in
four phases requiring specialized training.
The manufacturing process has 39 steps and
takes 45 minutes. After manufacturing, the
unit is subjected to a 25-step testing process,
which takes approximately 15 minutes. We
find these manufacturing and testing
operations in Sweden to be sufficiently
complex and meaningful, in that individual
components’ names, uses and identities are
lost and are transformed in Sweden into the
lift unit. Therefore, the country of origin of
the lift unit is Sweden.
You argue that of the lift unit, detachable
hand control and battery charger being
imported, the lift unit provides the essential
character of the Likorall System. ‘‘The term
‘character’ is defined as ‘one of the essentials
of structure, form, materials, or function that
together make up and usually distinguish the
individual.’ ’’ Uniden America Corporation v.
United States, 120 F. Supp. 2d. 1091, 1096
(citations omitted) (Ct. Int’l Trade 2000),
citing National Hand Tool Corp. v. United
States, 16 Ct. Int’l Trade 308, 311 (1992). In
Uniden (concerning whether the assembly of
cordless telephones and the installation of
their detachable A/C (alternating current)
adapters constituted instances of substantial
transformation), the Court of International
Trade applied the ‘‘essence test’’ and found
that ‘‘[t]he essence of the telephone is housed
in the base and the handset. Consumers do
not buy the article because of the specific
function of the A/C adapter, but rather
because of what the completed handset and
base provide: communication over telephone
wires.’’ Id. at 1096.
Further, you argue that the detachable
hand control and battery charger are
substantially transformed with the lift unit,
in that they have a new character, use and
name because they are attached to and form
parts of the Likorall System. In support of
this view, you cite Uniden, supra, in which
the court also found that the detachable
A/C adapters underwent a substantial
PO 00000
Frm 00063
Fmt 4703
Sfmt 4703
31805
transformation pursuant to the Generalized
System of Preferences (GSP) when installed
into the cordless telephones. The court noted
that the substantial transformation test is to
be applied to the product as a whole and not
to each of its detachable components. See id.
Consequently, the court found that the A/C
adapter, as part of the cordless phone, had a
new character, use and name.
Based on the findings of the court in
Uniden, we agree with your view that the
detachable hand control and battery charger
are substantially transformed when attached
to the lift unit. Consequently, if they are
imported from Sweden packaged together
with the lift unit, their country of origin for
purposes of U.S. government procurement
will be Sweden.
HOLDING
Based on the facts of this case, we find that
the manufacturing and testing operations
performed in Sweden substantially
transforms the non-TAA country
components. Therefore, the country of origin
of the lift unit is Sweden for purposes of U.S.
government procurement. Moreover, because
the lift unit conveys the essential character
of the Likorall System and the detachable
hand control and the battery charger are parts
of that system, they are substantially
transformed when attached to the lift unit.
The country of origin of the hand control and
battery charger for purposes of U.S.
government procurement, when imported
from Sweden packaged with the lift unit, is
Sweden.
Notice of this final determination will be
given in the Federal Register, as required by
19 CFR § 177.29. Any party-at-interest other
than the party which requested this final
determination may request, pursuant to 19
CFR § 177.31, that CBP reexamine the matter
anew and issue a new final determination.
Pursuant to 19 CFR § 177.30, any party-atinterest may, within 30 days after publication
in the Federal Register Notice referenced
above, seek judicial review of this final
determination before the Court of
International Trade.
Sincerely,
Harold M. Singer
Acting Executive Director
Regulations and Rulings
Office of International Trade
[FR Doc. 2010–13497 Filed 6–3–10; 8:45 am]
BILLING CODE 9111–14–P
DEPARTMENT OF HOUSING AND
URBAN DEVELOPMENT
[Docket No. FR–5300–FA–25]
Announcement of Funding Awards for
the Resident Opportunity and SelfSufficiency (ROSS)—Service
Coordinators Program for Fiscal Year
2009
AGENCY: Office of Public and Indian
Housing, HUD.
ACTION: Announcement of funding
awards.
E:\FR\FM\04JNN1.SGM
04JNN1
]]>Agencies
[Federal Register Volume 75, Number 107 (Friday, June 4, 2010)]
[Notices]
[Pages 31803-31805]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-13497]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
Notice of Issuance of Final Determination Concerning a Lift Unit
for an Overhead Patient Lift System
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security.
ACTION: Notice of final determination.
-----------------------------------------------------------------------
SUMMARY: This document provides notice that U.S. Customs and Border
Protection (``CBP'') has issued a final determination concerning the
country of origin of a lift unit for an overhead patient lift system.
Based upon the facts presented, CBP has concluded in the final
determination that Sweden is the country of origin of the lift unit for
purposes of U.S. government procurement.
DATES: The final determination was issued on May 28, 2010. A copy of
the final determination is attached. Any party-at-interest, as defined
in 19 CFR 177.22(d), may seek judicial review of this final
determination within July 6, 2010.
[[Page 31804]]
FOR FURTHER INFORMATION CONTACT: Heather K. Pinnock, Valuation and
Special Programs Branch: (202) 325-0034.
SUPPLEMENTARY INFORMATION: Notice is hereby given that on 2010,
pursuant to subpart B of part 177, Customs Regulations (19 CFR part
177, subpart B), CBP issued a final determination concerning the
country of origin of the lift unit which may be offered to the U.S.
Government under an undesignated government procurement contract. This
final determination, in HQ H100055, was issued at the request of Hill-
Rom Company, Inc., under procedures set forth at 19 CFR part 177,
subpart B, which implements Title III of the Trade Agreements Act of
1979, as amended (19 U.S.C. 2511-18). In the final determination, CBP
concluded that, based upon the facts presented, the lift unit,
assembled in Sweden from parts made in a non-TAA country and in Sweden,
is substantially transformed in Sweden, such that Sweden is the country
of origin of the finished article for purposes of U.S. government
procurement.
Section 177.29, Customs Regulations (19 CFR 177.29), provides that
notice of final determinations shall be published in the Federal
Register within 60 days of the date the final determination is issued.
Section 177.30, CBP Regulations (19 CFR 177.30), provides that any
party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial
review of a final determination within 30 days of publication of such
determination in the Federal Register.
Dated: May 28, 2010.
Harold M. Singer,
Acting Executive Director, Regulations and Rulings, Office of
International Trade.
Attachment
HQ H100055
May 28, 2010
OT:RR:CTF:VS H100055 HkP
CATEGORY: Marking
Karen A. McGee, Esq.
Linda M. Weinberg, Esq.
Barnes & Thornburg LLP
750 17th Street, N.W., Suite 900
Washington, DC 20006-4675
RE: Government Procurement; Country of Origin of a Lift Unit for an
Overhead Patient Lift System; Substantial Transformation
Dear Mses. McGee and Weinberg: This is in response to your
letter dated April 1, 2010, requesting a final determination on
behalf of Hill-Rom Company, Inc., pursuant to subpart B of part 177
of the U.S. Customs and Border Protection Regulations (19 C.F.R.
Part 177).
Under these regulations, which implement Title III of the Trade
Agreements Act of 1979 (TAA), as amended (19 U.S.C. 2511 et seq.),
CBP issues country of origin advisory rulings and final
determinations as to whether an article is or would be a product of
a designated country or instrumentality for the purposes of granting
waivers of certain ``Buy American'' restrictions in U.S. law or
practice for products offered for sale to the U.S. Government.
This final determination concerns the country of origin of a
lift unit for the Likorall Overhead Patient Lift System. We note
that as a U.S. importer Hill-Rom is a party-at-interest within the
meaning of 19 C.F.R. Sec. 177.22(d)(1) and is entitled to request
this final determination.
FACTS:
According to the information submitted, the Likorall Overhead
Patient Lift System is a ceiling-mounted or free-standing patient
lift system. The system is capable of lifting and transporting
patients with limited mobility, weighing up to 550 pounds, from one
part of a room to another or from one room to another. It can also
be used for weighing and lifting in combination with a stretcher and
for walking, standing, gait and balance training. The system is
designed to lift and move patients safely while avoiding injuries to
caregivers.
The merchandise at issue, the Likorall lift unit, is the
motorized component of the Overhead Patient Lift System that extends
and retracts the lift belt to which the patient-supporting sling is
attached. The unit is manufactured in 3 basic models: (1) 242, which
has a lifting capacity up to 440 pounds; (2) 243, which has a
lifting capacity up to 507 pounds; and (3) 250, which has a lifting
capacity up to 550 pounds. Models 243 and 250 come in an ``ES''
version, which is equipped with an infrared (IR) receiver for
optional use with a remote control. Model 242 comes in the ``S''
version, which operates only with an attached hand control, as well
as in the ES version. In addition, the 242 model has ``R2R''
versions, which feature a contact for a transfer motor so that the
patient can be moved between two independent overhead rail systems
in separate rooms, without the need for openings above doorways. The
lift unit was designed, developed and engineered in Sweden. It
incorporates approximately 100 components imported from non-TAA
countries, except for the motor, which is imported from a TAA
country and the IR remote control, which is made in Sweden.
At the manufacturing facility in Sweden, teams of employees
assemble the lift unit in a four segment process and perform a 25-
step final functional test under specified conditions. The segments
are: Manufacturing the electrical motor, drum and motor package in a
17-step process; mounting batteries and installing the exterior
covers of the drum/motor assembly in a 5-step process; connecting a
printed circuit board assembly (PCBA) to the motor, housed drum and
batteries in a 3-step process; and, assembling the emergency strap,
cover and end caps in a 14-step process. The PCBA is assembled and
programmed prior to importation into Sweden but is designed in
Sweden and its software program is written in Sweden. During the
final functional test the electronics of the lift unit are checked
and the maximum load is attached to check performance. At the
conclusion of the test, the employee performing the test must
complete a test protocol form, with the original being provided to
the customer and a copy retained by the manufacturer in a test log
that tracks units by serial number. The full manufacturing process
takes approximately 45 minutes and the testing process takes
approximately 15 minutes.
According to the information submitted, the employees
manufacturing the lift unit have mechanical knowledge and skill
related to their work gained from technical secondary education,
product specific training, and certified final functional test
training. The lift unit is also tested by an accredited testing
institute and complies with the requirements of directives for
medical-technical Class 1 products in the European Union (MDD 93/42/
EEC).
Packaged for retail sale with the lift unit is a hand control,
which is attached by cable to the overhead unit and is used to
control power, lifting and lowering of the lift unit's belt, and the
moving of the lift unit along the rails. The hand control plugs into
a contact on one of the end plates and is physically and
electrically connected to the overhead lift unit. It is made in a
non-TAA country. An IR remote hand control (ES versions and 242
ESR2R), which can be used as an alternative to the attached hand
control is also imported with the unit. The remote control and the
PCB it incorporates are made in Sweden. A battery charger, into
which the wired hand control is inserted to charge the batteries
inside the lift unit, is also imported with the lift unit. The
charger is made in the same non-TAA country as the hand control.
ISSUE:
What is the country of origin of the lift unit for purposes of
U.S. government procurement?
LAW AND ANALYSIS:
Pursuant to Subpart B of Part 177, 19 CFR Sec. 177.21 et seq.,
which implements Title III of the Trade Agreements Act of 1979, as
amended (19 U.S.C. Sec. 2511 et seq.), CBP issues country of origin
advisory rulings and final determinations as to whether an article
is or would be a product of a designated country or instrumentality
for the purposes of granting waivers of certain ``Buy American''
restrictions in U.S. law or practice for products offered for sale
to the U.S. Government.
Under the rule of origin set forth under 19 U.S.C. Sec.
2518(4)(B):
An article is a product of a country or instrumentality only if
(i) it is wholly the growth, product, or manufacture of that country
or instrumentality, or (ii) in the case of an article which consists
in whole or in part of materials from another country or
instrumentality, it has been substantially transformed into a new
and different article of commerce with a name, character, or use
distinct from that of the article or articles from which it was so
transformed.
See also 19 CFR Sec. 177.22(a).
In determining whether the combining of parts or materials
constitutes a substantial transformation, the determinative issue is
the
[[Page 31805]]
extent of operations performed and whether the parts lose their
identity and become an integral part of the new article. Belcrest
Linens v. United States, 573 F. Supp. 1149 (Ct. Int'l Trade 1983),
aff'd, 741 F.2d 1368 (Fed. Cir. 1984). Assembly operations that are
minimal or simple, as opposed to complex or meaningful, will
generally not result in a substantial transformation. See C.S.D. 80-
111, C.S.D. 85-25, C.S.D. 89-110, C.S.D. 89-118, C.S.D. 90-51, and
C.S.D. 90-97. In C.S.D. 85-25, 19 Cust. Bull. 844 (1985), CBP held
that for purposes of the Generalized System of Preferences
(``GSP''), the assembly of a large number of fabricated components
onto a printed circuit board in a process involving a considerable
amount of time and skill resulted in a substantial transformation.
In that case, in excess of 50 discrete fabricated components (such
as resistors, capacitors, diodes, integrated circuits, sockets, and
connectors) were assembled. Whether an operation is complex and
meaningful depends on the nature of the operation, including the
number of components assembled, number of different operations,
time, skill level required, attention to detail, quality control,
the value added to the article, and the overall employment generated
by the manufacturing process.
In order to determine whether a substantial transformation
occurs when components of various origins are assembled into
completed products, CBP considers the totality of the circumstances
and makes such determinations on a case-by-case basis. The country
of origin of the item's components, extent of the processing that
occurs within a country, and whether such processing renders a
product with a new name, character, and use are primary
considerations in such cases. Additionally, factors such as the
resources expended on product design and development, the extent and
nature of post-assembly inspection and testing procedures, and
worker skill required during the actual manufacturing process will
be considered when determining whether a substantial transformation
has occurred. No one factor is determinative.
CBP has held in a number of cases that complex and meaningful
assembly operations involving a large number of components result in
a substantial transformation. In Headquarters Ruling Letter (HQ)
H047362, dated March 26, 2009, CBP found that 61 components
manufactured in China and assembled into ground fault circuit
interrupters (GFCIs) in Mexico in a two-phase process by skilled
workers using sophisticated equipment were substantially transformed
in Mexico. In particular, we took into consideration that the first
phase involved the assembly of a PCB in a 42-step technically
complex process that took 12 minutes and that the completed PCB had
all the major components necessary for the GFCI to fulfill its
function. We also took into consideration that in the second phase
the PCB would be assembled with 29 other components to form the
GFCIs in a 43-step process taking approximately 10 minutes, after
which the components would have lost their individual identities and
become an integral part of the interrupters with a new name,
character and use.
By contrast, assembly operations that are minimal or simple will
generally not result in a substantial transformation. For example,
in HQ 734050, dated June 17, 1991, CBP held that Japanese-origin
components were not substantially transformed in China when
assembled in that country to form finished printers. The printers
consisted of five main components identified as the ``head'',
``mechanism'', ``circuit'', ``power source'', and ``outer case.''
The circuit, power source and outer case units were entirely
assembled or molded in Japan. The head and mechanical units were
made in Japan but exported to China in an unassembled state. All
five units were exported to China where the head and mechanical
units were assembled with screws and screwdrivers. Thereafter, the
head, mechanism, circuit, and power source units were mounted onto
the outer case with screws and screwdrivers. In holding that the
country of origin of the assembled printers was Japan, CBP
recognized that the vast majority of the printer's parts were of
Japanese origin and that the operations performed in China were
relatively simple assembly operations.
In this case, approximately 100 components manufactured in non-
TAA countries will be assembled in Sweden in four phases requiring
specialized training. The manufacturing process has 39 steps and
takes 45 minutes. After manufacturing, the unit is subjected to a
25-step testing process, which takes approximately 15 minutes. We
find these manufacturing and testing operations in Sweden to be
sufficiently complex and meaningful, in that individual components'
names, uses and identities are lost and are transformed in Sweden
into the lift unit. Therefore, the country of origin of the lift
unit is Sweden.
You argue that of the lift unit, detachable hand control and
battery charger being imported, the lift unit provides the essential
character of the Likorall System. ``The term `character' is defined
as `one of the essentials of structure, form, materials, or function
that together make up and usually distinguish the individual.' ''
Uniden America Corporation v. United States, 120 F. Supp. 2d. 1091,
1096 (citations omitted) (Ct. Int'l Trade 2000), citing National
Hand Tool Corp. v. United States, 16 Ct. Int'l Trade 308, 311
(1992). In Uniden (concerning whether the assembly of cordless
telephones and the installation of their detachable A/C (alternating
current) adapters constituted instances of substantial
transformation), the Court of International Trade applied the
``essence test'' and found that ``[t]he essence of the telephone is
housed in the base and the handset. Consumers do not buy the article
because of the specific function of the A/C adapter, but rather
because of what the completed handset and base provide:
communication over telephone wires.'' Id. at 1096.
Further, you argue that the detachable hand control and battery
charger are substantially transformed with the lift unit, in that
they have a new character, use and name because they are attached to
and form parts of the Likorall System. In support of this view, you
cite Uniden, supra, in which the court also found that the
detachable A/C adapters underwent a substantial transformation
pursuant to the Generalized System of Preferences (GSP) when
installed into the cordless telephones. The court noted that the
substantial transformation test is to be applied to the product as a
whole and not to each of its detachable components. See id.
Consequently, the court found that the A/C adapter, as part of the
cordless phone, had a new character, use and name.
Based on the findings of the court in Uniden, we agree with your
view that the detachable hand control and battery charger are
substantially transformed when attached to the lift unit.
Consequently, if they are imported from Sweden packaged together
with the lift unit, their country of origin for purposes of U.S.
government procurement will be Sweden.
HOLDING
Based on the facts of this case, we find that the manufacturing
and testing operations performed in Sweden substantially transforms
the non-TAA country components. Therefore, the country of origin of
the lift unit is Sweden for purposes of U.S. government procurement.
Moreover, because the lift unit conveys the essential character of
the Likorall System and the detachable hand control and the battery
charger are parts of that system, they are substantially transformed
when attached to the lift unit. The country of origin of the hand
control and battery charger for purposes of U.S. government
procurement, when imported from Sweden packaged with the lift unit,
is Sweden.
Notice of this final determination will be given in the Federal
Register, as required by 19 CFR Sec. 177.29. Any party-at-interest
other than the party which requested this final determination may
request, pursuant to 19 CFR Sec. 177.31, that CBP reexamine the
matter anew and issue a new final determination. Pursuant to 19 CFR
Sec. 177.30, any party-at-interest may, within 30 days after
publication in the Federal Register Notice referenced above, seek
judicial review of this final determination before the Court of
International Trade.
Sincerely,
Harold M. Singer
Acting Executive Director
Regulations and Rulings
Office of International Trade
[FR Doc. 2010-13497 Filed 6-3-10; 8:45 am]
BILLING CODE 9111-14-P
