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 LED-backlit LCD color televisions from Mexico; Article 509
Dear Mr. Zisser:
In your letter dated August 14, 2014, on behalf of Technology Solutions & Services, Inc., you requested a ruling on the status of LED-backlit LCD color televisions from Mexico under the NAFTA.
The subject merchandise is the Vizio 32-inch high-definition LED Smart TV, model E320I-B0, and the JVC 55-inch high-definition LED television, model EM55FTR. Both of these televisions have the capability of reproducing video and music files stored on a USB flash memory or storage device (not included).
Each television model consists of the following: the LCD subassembly with LED backlight, and the main board, both of which are stated to be manufactured in Mexico from non-originating Chinese components that are always imported separately into Mexico in different shipments and at different times.
When imported into Mexico, the LED-backlit LCD subassembly consists of the LCD with LED backlight panel, the controller board, the display board with control functions, the inverter power board, the infrared board, the front bezel, the back cover, the speakers, the Wi-Fi board (for model E320I-B0) and the stand, all of which come pre-assembled excepting the stand. This LED-backlit LCD subassembly, which will also be imported into Mexico with a remote control and a power cord, 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 the components, excepting the deflection circuitry, enumerated in Additional U.S. Note 9 to Chapter 85, Harmonized Tariff Schedule of the United States (HTSUS).
In Mexico, the LED-backlit LCD subassembly is disassembled in such a manner to allow the main board 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 these televisions will be 8528.72.6400, 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: 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—
(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.
Based on the facts provided, the LED-backlit LCD color televisions qualify for NAFTA preferential treatment because they will meet the requirements of HTSUS General Note 12(b)(ii)(A). Moreover, based on the information submitted, 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.” These LCD color televisions, 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 [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division