CLA-2 RR:CR:SM 559185 KSG
Area Port Director
U.S. Customs Service
Western Great Lakes Area
Minneapolis, Minnesota
RE: Application for Further Review of Protest No. 3501-92-100291; Nairobi Protocol; article specifically
designed or adapted for the use or
benefit of the blind or other physically or mentally
handicapped; subheading 9817.00.96;
therapeutic; part;
Dear Sir:
This is in reference to a protest and application for
further review filed by Starkey Laboratories, Inc.,
contesting the denial of the duty free exemption set forth
at subheading 9817.00.96, of the Harmonized Tariff Schedule
of the United States ("HTSUS"), to a hearing aid dispensing
system.
FACTS:
The imported article is a hearing aid dispensing
system, portaREM-2000 Digital, used for selecting, testing,
and fitting hearing aids. This equipment is used by hearing
health-care professionals in a office, clinic, or hospital
to determine if an individual's hearing aid is functioning
properly and in its correct frequency. This can be done in
two ways. First, the individual's hearing aid can be
inserted into a test chamber within the machine. The second
method involves inserting a very small probe attached to the
portaREM-2000 into the individual's ear channel while he or
she is wearing the hearing aid. The portaREM-2000 then
measures and records the hearing aid's performance while it
is actually in the ear. The portaREM-2000 can also be used
to determine the appropriate hearing aid circuitry for the
individual's particular needs after a hearing aid type is
selected by the patient. The country of origin of the
imported article is Denmark. The imported article was
entered on April 8, 1992. The protest was timely filed on
October 20, 1992.
ISSUE:
Whether the hearing aid dispensing system is eligible
for duty-free treatment under subheading 9817.00.96, HTSUS?
LAW AND ANALYSIS:
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. 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 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), 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. Individuals who
are hearing impaired are encompassed by this Note.
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.
The first issue presented is whether the portaREM-2000
is a therapeutic article within the meaning of U.S. Note
4(b) and thereby excluded from duty-free treatment under
subheading 9817.00.96, HTSUS. In Travenol Laboratories,
Inc. v. U.S., 813 F. Supp. 840 (CIT 1993), the court held
that devices used with a dialysis machine were not
therapeutic and therefore, the sets were eligible for duty-free treatment under subheading 9817.00.96, HTSUS. The
court found that kidney dialysis is not curative and curing
or healing is the standard with regard to the tariff meaning
of the term "therapeutic". The court relied on a prior
case, Richards Medical Co. v. U.S., 720 F. Supp. 998 (CIT
1989), which involved an imported hip prosthesis and
separately packaged instruments. The court stated that
Congress intended to limit the duty-free treatment only to
those articles which help handicapped persons to adapt to
their handicapped condition. The court held that only
articles used to heal or cure disease are considered
"therapeutic" within the meaning of the provision. The
court also held that the fact that the handicapped persons
themselves do not use these instruments or that they do not
remain in the body of the person does not preclude
classification of the instruments under this provision (item
960.15, TSUS).
The portaREM-2000 is similar to both the articles
imported in Travanol and Richards Medical Co. in that the
hearing aid dispensing system will not heal or cure people
who are hearing impaired. Rather, the hearing aid
dispensing system is used to test hearing aids as well as to
fit people for hearing aids to help the hearing impaired
person adapt to his/ her handicap. Therefore, we find that
the portaREM-2000 is not a therapeutic article.
Accordingly, the portaREM-2000 is not precluded from
subheading 9817.00.96, HTSUS, treatment by U.S. Note 4(b) of
Chapter 98, HTSUS.
The second issue that must be addressed is whether the
portaREM-2000 is a part. This issue is covered in T.D. 92-77, issued August 3, 1992. The T.D. states that the
exclusion of parts under the Nairobi Protocol is based on
the well established principle of Customs law that a tariff
provision which does not specifically provide for parts does
not include parts. We note that subsequent to the filing of
this protest, Congress amended this provision so that for
goods entered on or after January 1, 1995, parts and
accessories are specifically provided for.
The traditional rule is that a part' of an article is
something necessary to the completion of that article. The
T.D. cited U.S. v. Willoughby Camera Stores, Inc., 21 CCPA
332 (1933), Westfield Manufacturing Company v. U.S., 191 F.
Supp. 578 (1961), and Schick X-Ray Co. v. U.S., 271 F. Supp.
3305 (1967). These cases held that the mere fact that two
articles are designed to be used together is not alone
sufficient to establish that either is a part of the other,
or of their combined entity. An article possessed of the
characteristics of a completely finished and self contained
object is not considered a part.
In HRL 087559, dated October 9, 1990, Customs held that
resistors, microphones, and potentiometers used in hearing
aids were "parts" and therefore, precluded from duty-free
treatment under the Nairobi Protocol. In HRL 555965, dated
November 21, 1991, Customs held that a hearing aid
programming unit was not a "part" of a hearing aid and could
be entered duty-free. The product involved in HRL 555965
was very similar to the instant case. A hearing aid
programming unit sets the frequency parameters of hearing
aids to meet the hearing requirements of an individual.
The imported articles in the instant case can be
distinguished from HRL 087559 because although the portaREM-2000 is designed to be used with a hearing aid, it is a
completely finished and self-contained object and does not
function as a "part" of a hearing aid. The hearing aid and
the portaREM-2000 are not a combined entity. Rather , the
portaREM-2000 operates much like the hearing aid programming
unit: it is functionally self-sufficient and does not
undergo any further manufacture or manipulation after
importation into the U.S., and once the hearing aid is
adjusted, it is not needed for the functioning of the
hearing aids for its intended purpose.
Therefore, we find that the portaREM-2000 is not a part of a
hearing aid.
Since this article is designed to benefit the handicapped,
it is entitled to duty-free treatment under subheading
9817.00.96, HTSUS.
HOLDING:
The portaRem-2000 is entitled to duty-free treatment
under subheading 9817.00.96, HTSUS. Accordingly, you should
grant this protest in full.
In accordance with Section 3a(11)(b) of Customs
Directive 099 3550-065, dated August 4, 1993, this decision
should be attached to Customs Form 19, Notice of Action, and
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 mailing of this decision. Sixty days from the date
of this 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 to the
public via the Diskette Subscription Service, the Freedom of
Information Act, and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division