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HQ 221136


June 26, 1989

CON-9-13 CO:R:C:E 221136 MM

CATEGORY: CLASSIFICATION

TARIFF NO.: 9813.00.55

Mr. C. M. Swinburnson
Border Brokerage Co., Inc.
P. O. Box B
Blaine, Washington 98230

RE: Applicability of HTS 9813.00.55 to a portable brine freezer unit from Canada.

Dear Mr. Swinburnson:

This is in reply to your letter dated December 13, 1988, on behalf of your client, Farwest Fisheries Inc.

FACTS:

An American company plans to import a brine freezer unit from its Canadian parent company for its use during the month of April each year to freeze whole herring roe for subsequent exportation. In order to achieve the highest quality product for exportation to Japan the herring roe will be frozen as soon as possible after harvesting. The basic components consist of a product conveying system, a brine freezer, a subcooling belt freezer and a refrigeration package which will be installed in five 40-foot containers. The system was designed to the Canadian firm's specifications and will be able to freeze herring in approximately 25 minutes and has a capacity of 125 tons per day. The on-site construction and operation will be supervised by an employee of the Canadian firm.

ISSUE:

Whether a portable brine freezer used to freeze whole herring roe for export may be admitted temporarily free of duty under bond under subheading 9813.00.55, Harmonized Tariff Schedule of the United States (HTS)), as an article of special design for temporary use exclusively in the manufacture or production of articles for export.

LAW AND ANALYSIS:

Subheading 9813.00.55, (HTS) (formerly item 864.55, Tariff Schedules of the United States (TSUS)) provides for the temporary entry free of duty under bond of articles of special design for temporary use exclusively in connection with the manufacture or production of articles for export. A study of the legislative history and past Customs decisions indicates that this section of the tariff law which was originally part of section 308(9) of the Tariff Act of 1930, as amended, was enacted to enable domestic manufacturers to compete in foreign markets for the sale of such articles meeting the foreign purchaser's specification. This provision contemplates the temporary importation of an article of special design, such as a mold, die, engraving plate, special tool, or blueprint, to be used to reproduce in the United States merchandise made to the foreign purchaser's specification.

To qualify under this subheading the article must be of special design and must be used to manufacture or produce articles for export. We do not consider the brine freezer unit to be an article of special design such as the pattern-type articles listed above. What constitutes an article of "special design" has been discussed previously in C.S.D. 82-158.

With respect to the second requirement, a manufacture or production has been defined for customs purposes as a process which changes or transforms an article into a new and different article having a distinctive name, character or use. Anheuser- Busch Brewing Association v. United States, 207 U.S. 556 (1907).

Freezing is not considered a manufacture or production because its purpose is to preserve an article in its original condition as much as possible rather than to change or transform an article into something new and different.

As an alternative you may wish to consider entry under subheading 9813.00.50, HTS, which provides, in part, for the free entry, under temporary importation bond, of professional equipment and tools of trade, imported by or for nonresidents sojourning temporarily in the United States and for the use of such nonresidents. U.S. Note 1(b), Chapter 98, Subchapter XIII, HTS, provides that for articles admitted into the United States under subheading 9813.00.50, entry shall be made by the nonresident importing the article or by an organization represented by the nonresident which is established under the laws of a foreign country. Equipment under this provision is intended to be necessary for the exercise of the calling, trade, or profession of a person visiting this country to perform a specific task.

To qualify for entry under subheading 9813.00.50 the merchandise must be intended for use by the nonresident or for use under his direct supervision. The privileged entry under subheading 9813.00.50 is personal to the nonresident, is non- transferable, and terminates when he either ceases to use the imported merchandise or when it ceases to be used under his direct supervision.

HOLDING:

A brine freezer unit used to freeze whole herring roe for export may not be entered under subheading 9813.00.55, HTS, because the unit is not an article of special design and because the process of freezing is not a manufacture or production.

Sincerely,

John A. Durant

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