CLA-2 RR:CR:SM 561329 BLS
Fusae Nara, Esq.
Winthrop, Stimson, Putnam & Roberts
One Battery Park Plaza
New York, NY 10004-1490
RE: Eligibility for NAFTA preference of television receivers imported from Mexico;
General Note 12(t)/85.85
Dear Ms. Nara:
This is in reference to your letters dated March 24, May 24, and June 24, 1999, on behalf of Sharp Electronics Corporation ("Sharp"), requesting a ruling that certain television receivers will be eligible for preferential treatment under the North American Free Trade Agreement (NAFTA) upon importation into the U.S.
You state the following:
The television set in question, Model No. 19LM100S, has a diagonal measurement of approximately 19 inches, and is produced in Mexico by Sharp Electronica Mexico S.A. de C.V. ("Semex"). It is a non-high definition, non-projection type television receiver incorporating a color picture tube.
Semex assembles picture tube assemblies in Mexico by affixing degaussing coil deflection yoke and mounting brackets to color picture tubes. The chassis of the television set is produced by populating a bare printed circuit board using an automatic insertion machine, a surface mounting device and by manual insertion process. The chassis and picture tube assembly are placed in a cabinet in the final assembly process. Once the electronic components of the picture tube and chassis are properly connected, the picture tube is aligned, and the product undergoes final inspection for quality control. Thereafter, the back panel
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of the television cabinet is affixed, and the product is packaged.
Semex produces Model No. 19M100S using both NAFTA-originating and non-originating components. The bill of materials attached to your letter of June 24 lists the components by code, and includes a description of each item, its classification, and the country of origin.
You state that at present, the cathode-ray tube and tuner used to produce the television sets are of Mexican origin. However, in the future Semex will be incorporating non-originating tuners in assembling Model No. 19LM100S.
Whether the television receivers assembled in Mexico which will incorporate non-originating tuners and other non-originating parts will be eligible for NAFTA preference upon importation into the U.S.
LAW AND ANALYSIS:
To be eligible for tariff preference under the NAFTA, goods must be “originating goods” within the rules of origin in General Note 12(b), Harmonized Tariff Schedule of the United States (HTSUS). In this case, pursuant to General Note 12(b)(ii) the television sets imported into the U.S. may be originating if:
(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 subdivision (r), (s) and (t)
of this note or the rules set forth therein, or
(B) the goods otherwise satisfy the applicable requirements of subdivision
(r), (s) and (t) where no change in tariff classification is required, and
the goods satisfy all other requirements of this note...
Under the circumstances of this case, we must determine whether the non-originating parts are transformed in Mexico pursuant to General Note 12(b)(ii)(A), HTSUS. In this regard, we find that the television receivers are classifiable under subheading 8528.12.32, HTSUS, which provides for: "reception apparatus for
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television, whether or not incorporating radiobroadcast receivers or sound or video recording or reproducing apparatus; ....: [r]eception apparatus for television, whether or
not incorporating radiobroadcast receivers or sound or video recording or reproducing apparatus: [c]olor: [n]on-high definition, having a single picture tube intended for direct viewing (non-projection type), with a video display diagonal exceeding 35.56 cm: "[o]ther....." You believe the tuners are properly classifiable under subheading 8529.90.01, HTSUS, as "Printed circuit assemblies: Of television apparatus: Tuners." You have also classified the other non-NAFTA materials and components (on the bill of materials) of the receiver (including the chassis) under the following subheadings:
Screw - 7318.15.60 Holder- 3926.90.98 Washer - 7318.22.00
R/C Unit - 8526.92 Battery - 8506.80
Magnet - 8505.11
Earth Parts - 8544.41.80
Coil - 8504.50.80
You have classified the non-originating components of the chassis under the following subheadings:
Spacer - 8529.90.93 Insulator - 2525.10
Transistor - 8541.21 Fuse - 8536.10
Resistor (carbo) - 8533.10 Switch - 8536.50.90
Resistor (metal) - 8533.40.40 Filter - 8529.90.99
Resistor (cement)- 8533.40.99 Eyelet - 8529.90.93
Connection Wire - 8544.41.80 Ferrite Bead - 8504.50.80
PC Board (Main) - 8534 (heading) Resistor - 8533.40.80
Jack - 8536.90.40
Lug Terminal - 8536.90.40
Plug - 8536.69.40
Capacitor - 8532.30
Coil - 8504.50.80
Crystal - 8541.60
Diode - 8541.10
IC - 8542.14.80
Transformer - 8504.31.40
Heatsink - 8529.90.93
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We will assume for the purposes of this ruling that the classification of the tuner and other non-originating components are correct.
The rule applicable to goods of subheading 8528.12.32, HTSUS, is provided for in
General Note 12(t)/85.85, HTSUS, which provides the following:
A change to tariff items 8528.12.28 or 8528.12.32 from any other heading, except from tariff items 8529.90.43, 8529.90.46, 8529.90.49 or 8540.11.10 or more than one of the following:
(A) tariff item 7011.20.10,
(B) tariff item 8540.91.15.
As the tuner and other non-originating components will undergo a change in tariff classification under this rule, the imported television receivers are considered to be “goods originating in the territory of a NAFTA party” and thus will be eligible for NAFTA preference upon importation.
Based on the information submitted, the nonoriginating components will undergo the requisite change in tariff classification in Mexico required in General Note 12(t), HTSUS. Therefore, the imported television receivers will be considered “goods originating in the territory of a NAFTA party,” and eligible for NAFTA preference.
Should it be subsequently determined that the classification of the components as set forth in your submission is not accurate or that any information furnished is not complete and does not comply with 19 CFR 177.9(b)(1), the ruling will be subject to modification or revocation. Accordingly, if there is any change in the facts submitted to Customs, it is recommended that a new ruling request be submitted in accordance with 19 CFR 177.2.
A copy of this ruling should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.
John Durant, Director
Commercial Rulings Division