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HQ 563530




September 27, 2006

CLA-2 RR:CTF:SM 563530 KSG

CATEGORY: CLASSIFICATION

TARIFF NO.: 9817.00.96

John M. Peterson, Esq.
Neville Peterson LLP
17 State Street- 19th Floor
New York, NY 10004

RE: Subheading 9817.00.96; acute and transient disability; blood oxygenator product

Dear Mr. Peterson:

This is in reference to a letter dated June 20, 2006, sent on behalf of Terumo Cardiovascular Systems Corporation, seeking reconsideration of New York Ruling M81498, dated April 6, 2006, which denied duty-free treatment under subheading 9817.00.96, of the Harmonized Tariff Schedule of the United States (“HTSUS”) for a monofilament filtration blood oxygenator product (“blood oxygenator product). We have forwarded your issue of whether the imported good is properly classified under heading 9018, HTSUS, to the Tariff Classification & Marking Branch for their review. They will respond to you directly.

FACTS:

The imported product is a polyethylene blood oxygenator product produced in Japan. It is produced from the extrusion of raw polypropylene in pellet form. The pellets are heated until in a liquid state. The liquid polypropylene is then forced through a nozzle to form a hollow thread and is cooled in water to solidify the hollow form. During the extrusion process, seed oils are used. During cooling, these oils are separated and removed from the polymer, creating pores in the hollow polypropylene membrane. After cooling and drying, the polypropylene membrane is wound onto cores and shipped to the U.S.

The microporous polypropylene hollow filtration component is an extracorporeal gas exchange device. Blood flows on the outside of the fibers and ventilating gas flows through the fibers. The passage of gas through the membrane provides for the oxygenation of blood, so that it can be returned to a patient’s body or (in the case of implantable artificial lung devices, returned to the bloodstream) with a fresh supply of oxygen.

The imported oxygenator is applied to patients using a variety of devices. In some instances, the product will be inserted, wound over a core, into blood oxygenators which are used during surgical or other medical procedures. In other cases, the oxygenator material will be placed in “artificial lung” devices which are used to provide respiration for more extensive periods, primarily non-surgical situations. These oxygenator and artificial lung devices consists of plastic chambers into which oxygen is pumped through rubber or plastic hose connections, and from which carbon monoxide is removed the same way. Although these devices are referred to as “oxygenators”, the actual oxygen function is performed by the imported filament product that is the subject of this request.

ISSUE:

Whether the imported blood oxygenator product is eligible for duty-free treatment under subheading 9817.00.96, HTSUS.

LAW AND ANALYSIS:

The Agreement on the Importation of Educational, Scientific and Cultural Materials, known as the Florence Agreement, is an international agreement drafted by the United Nations Educational, Scientific, and Cultural Organization (UNESCO) and adopted by it in Florence, Italy, in July 1950 (17 UST 1835; TIAS 6129). It provides for duty-free treatment and the reduction of trade obstacles for imports of educational, scientific, and cultural materials in the interest of facilitating the international free flow of ideas and information. Materials falling within the coverage of the Florence Agreement include: books, publications and documents; works of art and collector’s pieces; visual and auditory materials; scientific instruments and apparatus; and articles for the blind.

The Nairobi Protocol to the Florence Agreement on the Importation of Educational, Scientific, and Cultural Materials Act of 1982 expanded the scope of the Florence Agreement primarily by expanding duty-free treatment for certain articles for the use or benefit of the handicapped in addition to providing duty-free treatment for articles for the blind. The 97th Congress passed Pub. L. 97-446 to ratify the Nairobi Protocol in the U.S. The Senate stated in its Report that one of the goals of this law was to benefit the handicapped and show U.S. support for the rights of the handicapped. The Senate, however, did state that it did not intend “that an insignificant adaptation would result in duty-free treatment for an entire relatively expensive article... the modification or adaptation must be significant so as to clearly render the article for use by handicapped persons.” S. Rep. No. 97-564, 97th Cong. 2nd Sess. (1982). The Senate was concerned that persons would misuse this tariff provision to avoid paying duties on expensive products.

Section 1121 of the Omnibus Trade and Competitiveness Act of 1988 and Presidential Proclamation 5978 provided for the implementation of the Nairobi Protocol by inserting permanent provisions, subheadings 9817.00.92, 9817.00.94, and 9817.00.96, into the HTSUS. These tariff provisions specifically state that “articles specifically designed or adapted for the use or benefit of the blind or other physically or mentally handicapped persons” are eligible for duty-free treatment.

U.S. Note 4(a), Subchapter XVII, Chapter 98, HTSUS, states that the term “blind or other physically or mentally handicapped persons” includes any person suffering from a permanent or chronic physical or mental impairment which substantially limits one or more major life activities, such as caring for one’s self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, or working.

U.S. Note 4(b), chapter 98, HTSUS, states that subheadings 9817.00.92, 9817.00.94 and 9817.00.96 do not cover (i) articles for acute or transient disability; (ii) spectacles, dentures, and cosmetic articles for individuals not substantially disabled; (iii) therapeutic and diagnostic articles; or (iv) medicine or drugs.

Based on the language of U.S. Note 4(a), a person suffering from permanent or chronic breathing impairment is physically handicapped as that term is defined in U.S. Note 4(a) to Subchapter XVII.

The issue is whether the imported blood oxygenator is an article for “acute or transient” (temporary) breathing impairment which would not be eligible for subheading 9817.00.96 treatment pursuant to U.S. Note 4(b)(i).

Counsel argues that Nairobi Protocol articles need not be in continuous, long term use. However, CBP has ruled in previous rulings that the product must be used for a long term use over a long duration of time in order to qualify for subheading 9817.00.96 treatment.

In Headquarters Ruling Letter ("HRL") 556532 dated June 18, 1992, U.S. Customs and Border Protection ("CBP") considered traditional white and red folding canes for the blind or visually impaired, standard wood and lucite walking canes (one style with a handle similar to the canes under consideration in this case), heavy-duty aluminum adjustable walking canes, tripod and quad canes, a pick-up cane with reacher, forearm crutches, and standard wood and aluminum underarm crutches. In HRL 556532, it was determined that the individuals who utilized the canes and crutches were handicapped persons pursuant to Note 4(a) which includes individuals who have difficulty walking. Therefore, the remaining issue to be resolved was whether some of the canes and crutches were precluded from receiving duty-free treatment under Note 4(b)(i) as articles intended for acute or transient disabilities. Upon consideration of the matter, CBP determined that, even though individuals with acute disabilities (such as sprained ankles, etc.) utilized the canes in some instances, the canes and forearm crutches were of the class or kind predominately used by permanently or chronically handicapped individuals. Therefore, the canes and forearm crutches were eligible to receive duty-free treatment under subheading 9817.00.96, HTSUS. However, CBP also held that, even though crutches may be used by individuals with chronic or permanent disabilities, they are predominantly used by individuals with acute or transient disabilities. As such, the crutches (other than the forearm crutches) were precluded from receiving duty-free treatment under subheading 9817.00.96, HTSUS. See also HRL 557734, dated April 18, 1994 (upholding and relying on HRL 556532 in a case pertaining to the applicability of subheading 9817.00.96, HTSUS, to certain aluminum folding walkers).

In HRL 085094, dated May 10, 1990, Customs held that reuseable polyester/vinyl/rayon underpads sold principally to intermediate care facilities, nursing homes and chronic care facilities were eligible for duty-free treatment under subheading 9817.00.96, HTSUS. Customs stated that ..."an individual with acute or transitory incontinence would not be likely to purchase reusable products, such as those at issue, based on cost alone. Such an individual could easily meet their need for much less with disposable products.” In HRL 563008, dated May 20, 2004, CBP held that imported disposable incontinent care products that were not durable or reuseable or designed for long-term use over a long period of time were not eligible for duty-free treatment under subheading 9817.00.96, HTSUS.

In this case, the product is designed to be utilized for an acute breathing impairment such as one where a patient with a breathing impairment is undergoing a surgical procedure (or other medical procedure) or gets a cold and thereby suffers temporarily from a more diminished breathing ability than they usually suffer from. Either usage would be considered an “acute or transient” (temporary) breathing impairment which would not be eligible for subheading 9817.00.96 treatment pursuant to U.S. Note 4(b)(i). Accordingly, based on the rulings cited above, we find that the imported blood oxygenator is not eligible for duty free treatment under subheading 9817.00.96, HTSUS.

HOLDING:

The imported blood oxygenator is not eligible for duty free treatment under subheading 9817.00.96, HTSUS. We affirm NY M81498 on this issue.

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.

Sincerely,

Monika R. Brenner, Chief
Valuation & Special Programs Branch

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