DRA-4 CO:R:C:E 224190 TLS
Regional Commissioner
U.S. Customs Service
One World Trade Center Suite 705
Long Beach, California 90831-0700
RE: Protest #2704-92-102387 concerning claim for same condition
drawback under 19 U.S.C. 1313(j); AST Research, Inc.; automatic
data processing machine with dual voltage power supply.
Dear Sir:
The above-referenced protest has been forwarded to this
office for further review. We have considered the points raised
by the protestant and your office. Our decision follows.
FACTS:
The protestant sells desktop computers which can operate on
either 115 or 230 volt power systems. A dual voltage power
supply is utilized rather than a conventional power supply to
achieve this versatility. The protestant states that an external
switch on the back of the computer slides back and forth to
change from one power rating to another.
Your office contends that these computers were not exported
in the same condition as imported because they were altered to
operate under a different power system before exportation. The
protestant claims that the different power setting is a result of
the testing the computer undergoes before exportation and that
the power switch is operated in this instance.
ISSUE:
Whether the switching of the voltage power system before
exportation is a "use" which disqualifies the subject merchandise
from same condition drawback.
LAW AND ANALYSIS:
The provisions for same condition drawback may be found
under 19 U.S.C. 1313(j)(1). The statute provides that, inter
alia, drawback may be obtained on merchandise exported within
three years of the date of importation in the same condition as
was imported. The merchandise also must not be used within that
three-year period. Id. In the present case, there is no dispute
that the merchandise was exported within three years of the date
of importation. The issue is whether the computers were "used"
before exportation.
There are several rulings that have determined what
constitutes "use" in these types of cases. In Customs Service
Decisions (C.S.D.'s) 82-7, 89-13, 89-73, and 91-18, it was held
that the alteration of merchandise to change its voltage capacity
is considered more than an incidental change and results in the
merchandise not being in the same condition as when imported.
See also HQ 223342 (October 8, 1991). In those cases, the common
activities that led to a finding of not in the same condition
were alterations, exchange of component parts, or repairs made to
the articles so that they performed different functions than
before. C.S.D. 89-73.
In this case, the computers have built in switches on their
back panels which are used to change the voltage system the
computers can operate on. For instance, to switch from operating
on a 115 voltage system to a 230 voltage system or vice versa,
the user can move the switch from one side to another, using a
pointed object of some kind. These computers are designed for
this function; the units are marketed with this as a prominent
feature. We find distinction from C.S.D. 89-73, where changes
were made to allow the merchandise to perform a different task
than before, rather than interchangeable tasks in the normal
usage of the product, as is done here. Therefore, given that the
nature of the subject merchandise is to switch back and forth
between the different power systems, we find that the testing of
the computers utilizing a 230 voltage system is an incidental
operation.
HOLDING:
The testing of the computers in this case while utilizing a
230 voltage system is an incidental operation for drawback
purposes. The merchandise is eligible for same condition
drawback under 19 U.S.C. 1313(j)(1). This ruling is limited to
the facts of this case. Protests ##2704-92-102388 through 2704-
92-102399, 2704-92-102477, and 2704-92-102800 should be handled
accordingly, as they involve the same merchandise, importer, and
proposed transactions.
Sincerely,
John Durant, Director
Commercial Rulings Division