United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1999 NY Rulings > NY E88260 - NY E88312 > NY E88310

Previous Ruling Next Ruling
NY E88310




November 8, 1999

LA-2-90:RR:NC:MM:105 E88310

CATEGORY: CLASSIFICATION MARKING

TARIFF NO.: 9802.00.8040; 9018; 9033

Mr. Edmundo Rodriquez
Nestor Reyes, Inc.
POB 9023474
San Juan, PR 00902-3474

RE: The marking and tariff classification of various parts of medical related devices from the Dominican Republic

Dear Mr. Rodriquez:

In your letter, dated October 15, 1999, for B. Braun of Puerto Rico, you requested a marking and tariff classification ruling.

You submitted dozens of samples and reams of information. You state that all the samples, except subassembly X71-000-124, are “assembled in the Dominican Republic (DR) 100% from U.S. components...” We take this to mean that you are claiming that each USA component, as it arrives in the DR for assembly into the article later imported into Puerto Rico, is a product of the USA which has been shipped directly to the DR and that you are using “assembled” in its technical Customs meaning.

You state that the non-USA component in X71-000-124 has a “value of 7.71% of the total value in its condition as imported.” You state that the component’s value “only exceeds the “De Minimis Rule” by .71%. (Actual percentage of foreign component is 7.71% and the De minimis rule allows up to 7%).” This is quite erroneous. Although, in accordance with the NAFTA statutes, CR 102.13 defines “De Minimis” as up to 7 percent, that definition applies only to NAFTA determinations. De Minimis itself is a judicially created legal principle, i.e., that the law does not concern itself with trifles. The various Courts which have decided Customs cases have applied many tests in deciding if it applied in a given case, only one of which is cost. The importance of the function of the element and the context of its legislation are two other important considerations. In the case of Public Law 101-382, which you cite, the Report of the Senate Finance Committee, 101-252, dated March 22, 1990, states, in Section 2007 of the report, “This section grants duty-free treatment for articles assembled in CBI beneficiary countries from 100 percent U.S. content, and duty free and quota-free treatment to articles processed in CBI beneficiary countries from 100 percent U.S. ingredients, except water.” This use twice of “100 percent” shows Congressional intent to interpret “de minimis” quite narrowly for this purpose. PL 101-382 was incorporated into the body of the HTS via 9802.00.5010 and 9802.00.8040.

From your description, the primary classification of these items, except X71-000-124, is in Chapter 98.

All the samples, except X71-000-124, will be classified in subheading 9802.00.8040, Harmonized Tariff Schedule of the United States (HTS), free of duty, as articles not assembled in Mexico, that were assembled abroad of fabricated components, the products of the United States, which were exported in condition ready for assembly without further fabrication, which have not lost their physical identity, which have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process, and which meet the conditions of U.S. note 2-b to Subchapter II of Chapter 98.

(We note that if, in fact, some or all of the USA components are more than assembled in the DR, for example, they are remolded into a new shape, then they would presumably be classifiable in HTS 9802.00.5010, free of duty, as articles, which were returned to the USA after having been exported for repairs or alterations, not made pursuant to a warranty, and which meet the conditions of U.S. note 2-b to Subchapter II of Chapter 98.)

We assume that you will be able to supply the port of entry with whatever documents or other evidence it deems necessary to confirm that those conditions have, in fact, been met. CR 10.24 provides detailed instructions for documenting items classified in HTS 9802.00.80, but several elements, such as the very detailed cost information required, make little sense for items in HTS 9802.00.8040 since they are completely free of duty. We suggest you discuss the documentation required with the Customs personnel in each port in which you will make entry and/or the U.S. Customs Andean-CBI Help Desk, Miami International Airport, POB 52-3215, Miami, FL 33125-3215. The Help Desk`s telephone number is 305-869-2804 or 2815.

Per Statistical Note 2 to Subchapter II, you must split out on the Customs entry, "the dutiable value, i.e., the total value of the articles less the value of the U.S. fabricated components" and assign to it the classification that would ordinarily apply in the absence of US note 2-b to that Subchapter. Note that in this context, there is never any duty actually payable on this "dutiable value".

We cannot determine the classification(s) that would ordinarily apply to these items or the primary classification of X71-000-124. HTS Headings 9018 and 9033 are possibilities, among others. Since these classifications require consideration of the individual facts of the sample, we will rule on only five items in any one request per CR 177.2-b. Also, details for each sample are needed regarding other known uses for it or for items that are commercially fungible. When this information is available, you may wish to consider resubmission of that part of your request. If you decide to resubmit your request, please include all of the material that we have returned to you (if relevant to the specific samples you have chosen to include in that specific request) and mail your request to U.S. Customs, Customs Information Exchange, Room 437, 6 World Trade Center, New York, NY 10048, attn: Binding Rulings Section.

Items classified in 9802.00.8040 do not need to have any country of origin marking when imported into the U.S, nor will the Merchandise Processing Fees described in 19 CFR 24.23 apply. We note that if 9802.00.8040 does not apply, Customs Regulation 134.32-g, which you claim would apply, grants only a temporary relief from marking because the marking would have to be added after the processing in Puerto Rico under the procedures of CR 134.25-a.

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 above, contact National Import Specialist James Sheridan at 212-637-7037.

Sincerely,

Robert B. Swierupski
Director,
National Commodity

Previous Ruling Next Ruling

See also: