CLA-2-85:OT:RR:NC:N1:108
Mr. Steven B. Zisser
Zisser Customs Law Group
9355 Airway Road, Ste.1
San Diego, CA 92154
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of an LED-backlit LCD television from Mexico; Article 509
Dear Mr. Zisser:
In your letter dated September 6, 2011, on behalf of your client, Trend Smart CE Mexico S. de R.L. de C.V., you requested a ruling on the status of an LED-backlit LCD television from Mexico under the NAFTA.
The subject merchandise, based on the submitted information, is the Hitachi 46-inch LED-backlit HD LCD color television, model LE46S605, which is stated to represent similarly constructed Hitachi televisions of various diagonal-screen sizes ranging from 15 inches to 65 inches. This television, which incorporates a USB port, contains the internal circuitry and firmware that provide the television with the capability to reproduce video slideshows of JPEG photos stored on a USB storage device (not included).
The merchandise essentially consists of the LED-backlit LCD subassembly, the main board, the power board and the speakers, all of which are non-originating Chinese components that are imported separately into Mexico in different shipments and at different times. Although parts, including various subsidiary components of Chinese origin, are shipped independently to Mexico as production needs occur, the above-stated components are always shipped separately from each other.
When imported into Mexico, the pre-assembled LCD subassembly with LED backlight essentially consists of an LED-backlit LCD panel with inverter board and keyboard. The LCD subassembly does not contain a tuner or a main board and cannot receive or process a broadcast television signal or any other type of signal.
The main board, when imported into Mexico, is stated to contain all the television control elements, including a television tuner and all audio and video components. Furthermore, the main board, which does not have a power supply or a display screen, contains all of the components, except the deflection circuitry, enumerated in Additional U.S. Note 9 to Chapter 85 of the Harmonized Tariff Schedule of the United States (HTSUS).
In Mexico, the LCD subassembly with LED backlight is disassembled in such a manner to allow the main board, the power board and the speakers, as well as several minor components, to be incorporated into the LCD subassembly, with all the required operations being performed in assembling this merchandise. In this manner, the components are further manufactured to produce a functioning LED-backlit LCD television.
The applicable tariff provision for this television will be 8528.72.6400, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Monitors and projectors, not incorporating television reception apparatus…Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus: Other, color: With a flat panel screen: Incorporating video recording or reproducing apparatus: Other. The general rate of duty will be 3.9 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/.
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—
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
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.
Based on the facts provided, this LED-backlit LCD television qualifies for NAFTA preferential treatment because it will meet the requirements of HTSUS General Note 12(b)(ii)(A). Moreover, the non-originating components will undergo the appropriate change in tariff classification as required by HTSUS General Note 12 (t)/85.91(H), which reads: “A change to other reception apparatus for television of subheading 8528.72 from incomplete or unfinished reception apparatus for television (including assemblies for reception apparatus consisting of all the parts specified in chapter rule 3 to chapter 85 plus a power supply), not incorporating a cathode-ray tube, flat panel screen or similar display, of subheading 8528.72 or any other heading.”
This LCD color television, with an LED backlight, will therefore be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
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 Lisa Cariello at (646) 733-3014.
Sincerely,
Robert B. Swierupski
Director
National Commodity Specialist Division