CLA-2 R:C:S 559120 DEC
Port Director
United States Customs Service
200 St. Paul Place
Baltimore, Maryland 21202
RE: Application for Further Review of Protest No. 1303-94-100340, contesting
denial of duty-free treatment of cannulae for single use
hypodermic needles
as articles for the handicapped under the Nairobi Protocol;
Travenol
Laboratories, Inc. v. United States, Slip Op. 93-15, dated
February 3, 1993
(27 Cust. Bull. 1)
Dear Sir:
The above-referenced protest, timely filed by John S.
Connor, Incorporated, on behalf of Terumo Medical Corporation
(Terumo), protests the assessment of duties by your office on the
cannula for single use hypodermic needles under subheading
9018.31.0090, Harmonized Tariff Schedule of the United States
(HTSUS). The merchandise at issue was imported on April 23,
1993. Attorney Michael Donovan of Donavon & Van Hook submitted
additional information in support of Terumo's protest.
FACTS:
Terumo is a medical device supplier and manufacturer of
hemodialysis systems that people with end stage renal disease and
chronic kidney failure use when their kidney function has
completely and permanently stopped. The components of the
hemodialysis system are: (1) cellulose acetate hollow fiber
dialyzers, (2) priming sets, (3) dialyzer holders, (4) arterial
venous fistula (AVF) needle sets and cannulae. This protest
concerns the classification of the cannulae. The importer states
that the arterial venous fistula needle sets and cannulae are
designed to carry blood out of the patient's body to the dialyzer
and then carry the cleansed blood back to the patient through a
second arterial venous fistula cannula.
In support of the importer's protest, counsel has submitted
the affidavit of Mr. Chad Ruoff, Product Manager for the Dialysis
Division of Terumo. In his affidavit, Mr. Ruoff explains that
prior to the introduction of the arterial venous fistula cannulae
that are the subject of this protest, dialysis was conducted
using catheters or shunts. Since the development of arterial
venous fistula permitted regular and continuous access to a
patient's blood stream without the risk of infection or other
complications (blood clotting or shunt disconnection), dialysis
became available to chronic renal patients. Initially, smaller
and narrower needles and tubing were used, but problems continued
with blood flow and bloodstream access. To correct this problem,
an arterial venous fistula needle set was designed for use in
chronic hemodialysis. The new technology incorporated a larger
needle to allow for greater blood flow and less resistance. In
addition, to alleviate the repeated puncturing of the patient to
access his/her bloodstream, the AVF cannula bevel is ground to
make a surgical incision. The protestant states that this
feature promotes sharper penetration and more rapid healing. The
AVF cannula also has a siliconized wall for comfort and is
approximately 1 1/4" wide. The protestant also indicated that
the marketing and end use of the AVF cannula needle sets is
chiefly for chronic hemodialysis use.
ISSUE:
Whether the arterial venous fistula cannulae for single use
hypodermic needles are eligible for duty-free treatment pursuant
to the Nairobi Protocol.
LAW AND ANALYSIS:
The Nairobi Protocol to the Agreement on the Importation of
Educational, Scientific, and Cultural Materials Act of 1982,
established the duty-free treatment for certain articles for the
handicapped. Presidential Proclamation 5978 and section 1121 of
the Omnibus Trade and Competitive Act of 1988, provided for the
implementation of the Nairobi Protocol into subheadings
9817.00.92, 9817.00.94, and 9817.00.96, HTSUS. These tariff
provisions specifically provide that "[a]rticles specially
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." Clearly,
individuals who suffer from kidney failure are physically
handicapped as defined by this tariff provision. See Travenol
Laboratories, Inc. v. United States, Slip Op. 93-15 dated
February 3, 1993 (27 Cust. Bull. 1).
The American Medical Association Encyclopedia of Medicine,
pg. 230 (1989), defines "cannula" as follows:
A plastic or metal tube with a smooth, unsharpened tip
for inserting
into a blood vessel, lymphatic vessel, or body cavity
to introduce or
withdraw fluids . . . Cannulas are frequently used for
blood
transfusions and intravenous infusions and for draining
pleural
effusions. In certain circumstances, such as when
blood is required
for testing over a period of time, the cannula may be
left in place for
several days.
Narrower tubing was once the standard, but problems arose
due to insufficient blood flow. The cannulae at issue in this
protest are designed to be used specifically in the
administration of dialysis. The cannulae have a siliconized wall
for added comfort and are approximately 1 1/4" wide. In
addition, to alleviate the repeated puncturing of the patient to
access his/her bloodstream, the cannula bevel is ground to make a
surgical incision. The protestant states that this feature
promotes sharper penetration and more rapid healing. The
protestant also indicated that the marketing and end use of the
AVF cannula needle sets is chiefly for chronic hemodialysis use.
These factors combined compel Customs to find that the imported
cannulae are specially designed to be used in dialysis.
The Court of International Trade has held that hollow fiber
dialyzers and arterio-venous fistula cannulation sets as well as
arterial-venous blood tubing sets separately imported were
eligible for duty-free entry pursuant to the Nairobi Protocol.
See Travenol Laboratories, Inc. v. United States, Slip Op. 93-15
dated February 3, 1993 (27 Cust. Bull. 1). Based on a review of
the evidence submitted in conjunction with this protest, Customs
finds that Travenol case is controlling. Accordingly, the
articles that are subject of this protest are entitled to duty-free treatment as articles that are specially designed for the
use or benefit of the handicapped.
HOLDING:
The cannulae for single use hypodermic needles described
above are specially designed or adapted for the use or benefit of
the physically handicapped and, therefore, eligible for duty-free
treatment pursuant to the Nairobi Protocol and are properly
classified under subheading 9817.00.96, HTSUS. The protest
should be granted in full.
In accordance with Section 3A(11)(b) of Customs Directive
099 3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be mailed by your office to the
protestant no later than 60 days from the date of this letter.
Any
reliquidation of the entry in accordance with the decision must
be accomplished prior to the mailing of the decision. Sixty days
from the date of the decision the Office of Regulations and
Rulings will take steps to make the decision available to customs
personnel via the Customs Rulings Module in ACS and the public
via the Diskette Subscription Service, Freedom of Information Act
and other public access channels.
Sincerely,
John Durant
Director
Tariff Classification Appeals
Division