SENQCIA MAXCO, Ltd. 

David W. Egbert 

1630 Cobb International Boulevard 

 Kennesaw, GA 30152 

 Phone: (770) 424-9350 

 FAX: (770) 424-9145 

E-mail: degbert@senqmax.com 

The Honorable Robert Lighthizer 

United States Trade Representative 

Office of the United States Trade Representative 

600 17th ST. NW 

Washington, D.C. 20508 

Re: USTR-2018-0025 – Procedures to Consider Requests for Exclusion of Particular Products from the 

Determination of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to 

Technology Transfer, Intellectual Property and Innovation (83 FR 32181). 

Dear Ambassador Lighthizer: 

This letter is being submitted in support of Senqcia Maxco’s application for exclusion from the Section 

301 tariffs against imported goods from China for “Roller Chain Sprockets”, (HTS 8483.90.1010) for 

use in a mechanical roller chain drive system. This letter is intended to address the requirements 

stipulated in Part B of the Federal Register Notice detailing the process for requesting a product 

exclusion from the Section 301 tariffs. (83 Fed. Reg. 133 (July 11, 2018)). 

This exclusion request is in reference to HTS 8483.90.1010 which provides for [“Chain Sprockets and 

Parts thereof”] and is currently subject to additional 25% tariffs as of July 6 in accordance with the 

Section 301 tariff for products included on List 1. 

As discussed below, subjecting Senqcia Maxco Ltd. to the tariffs would cause severe economic harm to 

a U.S. company that is a supplier of these crucial parts to U.S. Industrial distributors who in turn supply 

U.S. based manufacturing facilities. We offer the following for your consideration: 
I. Senqcia Maxco’s Background 

Senqcia Maxco, Ltd. is a U.S. company, headquartered in Kennesaw, GA with 37 direct 

employees and approximately 50 commissioned based sales agents located throughout the 

United States. Our primary business is to source and supply industrial roller chains and 

sprockets for U.S. based Industrial Distributors and certain Original Equipment Manufacturers. 

We specialize in matching the quality and performance levels required by our customers with 

the appropriate product brand that satisfies their needs in the most cost effective way. 

II. Product Background and Descriptions 

Our products are used either as MRO parts (maintenance, repair and overhaul) to keep the 

equipment in a U.S. based manufacturing plant operating or as OEM parts (original equipment 

manufacturer) that are used in the products being made in a manufacturing plant. 

Roller chains and sprockets are used primarily as simple mechanical power transmission devices 

that transmit power from primary movers such as electric motors to secondary devices (often 

conveyors). Sometimes the chain and sprocket system will act as the carrying device for a 

conveyor or lifting mechanism. 

The specific products that we are seeking an exemption for is limited to the following: 

Steel Sprockets for ASME/ANSI single strand roller chains (Sizes 35, 40, 41, 50, 60, 80 and 100 

which includes all sizes less than 1.5 inches in pitch. The number of teeth for these sprockets 

are 60 or less; the outside diameter is less than 20 inches; the hub diameter is no greater than 6 

inches; the length through the bore (sprocket width) is no greater than 3 inches. 

The condition of the bore for these sprockets are plain bore (straight through hole with no 

keyway), finished bore (bore contains a rectangular slot for a key), Quick Detachable or QD (6 

drilled holes on the hub) and Taper Locke (at least 3 drilled and tapped hole slots drilled in the 

bore). These bore types are shown in the photos below: 
Plain Bore Sprocket Finished Bore Sprocket QD Sprocket Taper Locke Sprocket 

III. China’s Role as a Supplier 

As mentioned above Senqcia Maxco works to match quality and performance levels to customer 

need. Chinese made products occupy a specific level of quality-performance and price and have 

for many years. Roller chain sprockets were among the first industrial products imported into 

the USA going back to the early to mid-1980s. It is difficult to find sources that satisfy the 

performance-price tier outside of China as they are making for almost all of Asia. 

In the USA domestic producers (and there is only one that can produce domestically across the 

product line) have settled into their role of supplying higher performance products at higher cost 

for those that need it – with the lower cost/performance tier left for import mainly from China. 

We have looked without success to Korea, India, and Taiwan for comparable products but either 

the suppliers do not make a substantial portion of the products needed or they are importing 

their products from China as well.

IV. Effects of Additional Tariffs

The imposition of an additional 25% tariff to the existing 2.8% duty rate will cause significant 

hardship to both Senqcia Maxco and its customers. In February 2018 we undertook an 

expansion of our facilities in Georgia for the purpose of supplying sprockets to primarily 

independent industrial distribution companies and certain Original Equipment Manufacturers 

(OEMs) in the USA. The plan is to purchase base sprockets from China and perform secondary 

machining operations in a new facility in Georgia. To that end we have already spent more than 

$500,000 for new equipment (lathes, drills, and key-seaters and the associated tooling), pallet 

racks and shelving for storage, new machinists (employees) and a leased a larger facility. 
Photos – New Equipment and Facility investments 

The costs of these additional tariffs would have to be absorbed by Maxco and/or passed through the 

channel impacting margins for Senqcia Maxco and our distributors and unnecessarily increasing costs to 

the ultimate users since there are no viable equivalent cost/quality alternatives outside of China for these 

particular products. We are relying on these margins to pay for additional skilled labor (machinists) and 

to help fund additional growth investments. Additionally our customers that need the performance/cost 

level of the Chinese product will be harmed as they will be forced into higher cost options. This in turn 

leads to their products being less competitive globally. 

 

V. Sprockets are not essential to the Made in China 2025 Industrial Program 

Senqcia Maxco, Ltd. does not believe that roller chain sprockets are benefitting from Chinese 

industrial policies as the “Made in China 2025” policy is intended to “transform China into an 

advanced manufacturing leader.”1 To the contrary these products are very simply mechanical 

components with a long history of supply into the USA going back to the 1980s. They are not 

“technically advanced” in any material way and they help U.S. businesses remain competitive. 

In conclusion we are requesting an exemption for the tariff on roller chain sprockets under the HST code 

8483.90.1010 because: 

1. The tariffs will impose substantial financial hardships on our company as a result of recent 

investments made prior to the announcement of the imposition of the tariffs. 

2. There are very limited if any alternatives to the current suppliers that can achieve the 

cost/performance balance and satisfy the requirements of the existing market. 

3. The cost of the tariffs would reduce the competitiveness of U.S. manufacturing globally without 

being able to develop comparable cost/performance sources. 
4. Roller chain sprockets and the existing supply channels are well established going back to the 

1980s. These products are simple mechanical devices that convey no “technological advantage” 

to the maker. In fact some to the Made in China 2025 policies are making these components 

more costly such as the additional taxes that the Chinese impose on the factories to be “green”. 

We thank you for your consideration of our concerns and look forward to hearing from you at your 

convenience. 

Sincerely, 

Senqcia Maxco, Ltd. 

David Egbert 

Managing Director 

 

1 Made in China 2025: Global Ambitions Built on Local Protections, The U.S. Chamber of Commerce, 2017, 6.