You found the power steering filter.
Mine still has the hard porous ring, because I haven't asked if the filter has been updated to the pleated paper type. Maybe one of these days I'll stumble into a NOS filter.
'73 280SEL 4.5 (9/72)- RIP
Only 8,173 units built from 5/71 thru 11/72
'02 CLK320 Cabriolet - wifey's mid-life crisis
2012 VW Jetta Sportwagon TDI...at least its a diesel
Non illegitemae carborundum.