CLA-2-39:RR:E:NC:SP:221
Mr. Ryan D. Nelson
Hatch & Doty, P.A.
P.O. Box 643760
Vero Beach, FL 32964-3760
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of tubes and tube fittings from the United Kingdom, further processed in the United States; Article 509
Dear Mr. Nelson:
In your letter dated April 5, 2007, on behalf of Ormantine USA Ltd., Inc., you requested a ruling on the classification and status under the NAFTA of tubes and tube fittings from the United Kingdom further processed in the United States.
Ormantine imports polyvinyl chloride (PVC) tubes, Santoprene® thermoplastic tubes and PVC fittings from an exporter in the United Kingdom. The tubes and fittings arrive in bulk quantities and are unassembled upon receipt. Ormantine glues the fittings to the tubes to produce tubes that will be used in peristaltic pumps.
Ormantine’s customers either incorporate the assembled tubes into their existing peristaltic pumps as replacement tubes, or they incorporate the tubes into peristaltic pumps which are to be shipped to third party buyers as a complete and finished good.
The applicable subheading for the PVC tubes will be 3917.32.0010, Harmonized Tariff Schedule of the United States (HTSUS), which provides for tubes, pipes and hoses and fittings therefor…of plastics: other tubes, pipes and hoses: other, not reinforced or otherwise combined with other materials, without fittings, of polyvinyl chloride. The general rate of duty will be 3.1 percent ad valorem.
The applicable subheading for the Santoprene® tubes will be 3917.32.0050, HTSUS, which provides for tubes, pipes and hoses and fittings therefor…of plastics: other tubes, pipes and hoses: other, not reinforced or otherwise combined with other materials, without fittings…other. The general rate of duty will be 3.1 percent ad valorem.
The applicable subheading for the PVC fittings will be 3917.40.0090, HTSUS, which provides for tubes, pipes and hoses and fittings therefore (for example, joints, elbows, flanges), of plastics…fittings…other. The general rate of duty will be 5.3 percent ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.
You also request a ruling on whether the peristaltic pump tubes qualify as originating goods under the NAFTA. You suggest that the processing performed in the United States transforms the tubes and fittings into a part of a peristaltic pump, classifiable in subheading 8413.91.9080, HTSUS, which provides for other parts of liquid pumps.
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. Additional U.S. Rule of Interpretation 1(c) provides that in the absence of special language or context which otherwise requires, a provision for parts of an article covers products solely or principally used as a part of such articles but a provision for "parts" or "parts and accessories" shall not prevail over a specific provision for such part or accessory. A more detailed explanation of this classification principle, and in particular its application to parts of machinery that are described in subheadings of Chapter 39 of the HTSUS, may be found in HQ 966963, dated April 30, 2004. You may access this ruling using the Customs Rulings Online Search System (CROSS) at the Customs and Border Protection website at http://rulings.cbp.dhs.gov.
The applicable subheading for the peristaltic tubes with fittings will be 3917.33.0000, HTSUS, which provides for tubes, pipes and hoses and fittings therefor…of plastics: other tubes, pipes and hoses: other, not reinforced or otherwise combined with other materials, with fittings.
General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. §1202) states, in pertinent part, that
For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--
(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or
(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--
(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or
(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or
(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or
(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--
(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or
(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.
The peristaltic tubes produced from the imported tubes and fittings do not become originating goods under NAFTA because none of the above requirements are met. The goods do not meet the tariff shift requirements of HTSUS General Note 12(b)(2)(A) as set out in General Note subdivision 12(t)(39.1), which requires a change to headings 3901 through 3920 from any other heading, including another heading within that group, provided there is a regional value content of not less than 60 percent where the transaction value method is used or 50 percent where the net cost method is used. The PVC tubes without fittings, the Santoprene® tubes without fittings, and the peristaltic tubes with fittings are all classifiable in subheadings within heading 3917 of the HTSUS. Thus, the nonoriginating PVC tubes and nonoriginating Santoprene® tubes do not undergo a change in tariff heading when they are further processed to form peristaltic pump tubes with fittings.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Joan Mazzola at 646-733-3023.
Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments, within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs and Border Protection, 1300 Pennsylvania Ave. N.W., (Mint Annex), Washington, D.C. 20229.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division