CON-9-13 CO:R:C:E 221136 MM
Mr. C. M. Swinburnson
Border Brokerage Co., Inc.
P. O. Box B
Blaine, Washington 98230
RE: Applicability of HTS 9813.00.55 to a portable brine freezer
unit from Canada.
Dear Mr. Swinburnson:
This is in reply to your letter dated December 13, 1988, on
behalf of your client, Farwest Fisheries Inc.
FACTS:
An American company plans to import a brine freezer unit
from its Canadian parent company for its use during the month of
April each year to freeze whole herring roe for subsequent
exportation. In order to achieve the highest quality product for
exportation to Japan the herring roe will be frozen as soon as
possible after harvesting. The basic components consist of a
product conveying system, a brine freezer, a subcooling belt
freezer and a refrigeration package which will be installed in
five 40-foot containers. The system was designed to the
Canadian firm's specifications and will be able to freeze herring
in approximately 25 minutes and has a capacity of 125 tons per
day. The on-site construction and operation will be supervised
by an employee of the Canadian firm.
ISSUE:
Whether a portable brine freezer used to freeze whole
herring roe for export may be admitted temporarily free of duty
under bond under subheading 9813.00.55, Harmonized Tariff
Schedule of the United States (HTS)), as an article of special
design for temporary use exclusively in the manufacture or
production of articles for export.
LAW AND ANALYSIS:
Subheading 9813.00.55, (HTS) (formerly item 864.55, Tariff
Schedules of the United States (TSUS)) provides for the temporary
entry free of duty under bond of articles of special design for
temporary use exclusively in connection with the manufacture or
production of articles for export. A study of the legislative
history and past Customs decisions indicates that this section of
the tariff law which was originally part of section 308(9) of the
Tariff Act of 1930, as amended, was enacted to enable domestic
manufacturers to compete in foreign markets for the sale of such
articles meeting the foreign purchaser's specification. This
provision contemplates the temporary importation of an article of
special design, such as a mold, die, engraving plate, special
tool, or blueprint, to be used to reproduce in the United States
merchandise made to the foreign purchaser's specification.
To qualify under this subheading the article must be of
special design and must be used to manufacture or produce
articles for export. We do not consider the brine freezer unit
to be an article of special design such as the pattern-type
articles listed above. What constitutes an article of "special
design" has been discussed previously in C.S.D. 82-158.
With respect to the second requirement, a manufacture or
production has been defined for customs purposes as a process
which changes or transforms an article into a new and different
article having a distinctive name, character or use. Anheuser-
Busch Brewing Association v. United States, 207 U.S. 556 (1907).
Freezing is not considered a manufacture or production
because its purpose is to preserve an article in its original
condition as much as possible rather than to change or transform
an article into something new and different.
As an alternative you may wish to consider entry under
subheading 9813.00.50, HTS, which provides, in part, for the free
entry, under temporary importation bond, of professional
equipment and tools of trade, imported by or for nonresidents
sojourning temporarily in the United States and for the use of
such nonresidents. U.S. Note 1(b), Chapter 98, Subchapter XIII,
HTS, provides that for articles admitted into the United States
under subheading 9813.00.50, entry shall be made by the
nonresident importing the article or by an organization
represented by the nonresident which is established under the
laws of a foreign country. Equipment under this provision is
intended to be necessary for the exercise of the calling, trade,
or profession of a person visiting this country to perform a
specific task.
To qualify for entry under subheading 9813.00.50 the
merchandise must be intended for use by the nonresident or for
use under his direct supervision. The privileged entry under
subheading 9813.00.50 is personal to the nonresident, is non-
transferable, and terminates when he either ceases to use the
imported merchandise or when it ceases to be used under his
direct supervision.
HOLDING:
A brine freezer unit used to freeze whole herring roe for
export may not be entered under subheading 9813.00.55, HTS,
because the unit is not an article of special design and because
the process of freezing is not a manufacture or production.
Sincerely,
John A. Durant
Director
Commercial Rulings Division