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June 17, 1999

CLA-2-90:RR:NC:MM:105 E82853
CATEGORY: CLASSIFICATION
TARIFF NO.: 9031.80.8085
Mr. Herald Knudsen
Chimo Equipment Ltd.
1801-8th Street
Nisku, Alberta, Canada T9E 7S8

RE: The tariff classification of an electronic drilling recorder system exported from Canada.

Dear Mr. Knudsen:
In your letter, dated May 19, 1999, you requested a tariff classification ruling. You have withdrawn your request regarding “Origin Options”. The system, which you indicate will be imported together in a single shipment, will consist primarily of: 1. Several sensor/measuring devices which will ascertain, e.g., the drill bit’s depth, rpm, and torque and the mud volume and pump strokes. In your telephone conversation with NIS J. Sheridan, you estimated that these will account for roughly 40 percent of the system’s total cost. 2. A data acquisition box designed and built by your firm to serve as an interface between those devices and a PC. 3. An “off the shelf” PC system which will store large amounts of the data from the sensors in its disc drive and, secondarily, will store and display a much smaller amount of information input by managers such as the hours spent drilling and the number of drill bits used. 4. Software, mostly designed by your firm, which will format the data acquired in a way that will be most useful for drilling operators.

Per the telecon, you explained that the system, after importation, will be sent to a specific drilling rig, where all the components will be linked together and the sensors will be placed in the appropriate places on the rig. When the drilling at that site is completed, the system will be sent to a central location where the sensor data will be downloaded onto a disk which will be given to the drilling operator for their use in various analyses and record functions. It will then be sent to another drilling rig to perform the same function. We consider the system, imported together, to be a functional unit under Note 3 to Chapter 90 of the HTS. All its elements contribute towards its clearly defined drilling measurement function. 9031 is the last heading to appear in the HTS which covers measuring devices, at minimum, the torque measurers, that equally merit consideration as providing the essential character of the system. However, the dedicated software will be separately classifiable due to Note 6 to Chapter 85 of the HTS, and its value for Customs purposes will be only the value of the medium, not the value of the content. NYRL B86452, 6-19-97, noted.

The applicable subheading for this item will be 9031.80.8085, Harmonized Tariff Schedule of the United States (HTS), which provides for “other”, non-optical measuring instruments. The general rate of duty will be 1.7 percent ad valorem. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist James Sheridan at 212-637-7037.

Sincerely,

Robert B. Swierupski
Director,
National Commodity

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