CLA-2-73:S:N:N1:115 874970
Mr. Reinhard T. Stipp
RTS Advanced Modular Equipment Systems Inc.
11831-79 A Avenue
Delta, BC V4C 7H8 Canada
RE: The tariff classification of hospital equipment from
Germany.
Dear Mr. Stipp:
In your letter dated May 24, 1992, you requested a tariff
classification ruling.
The subject product is described as the DVE 4000 Series
modular design system for hospital operating rooms and intensive
care units. The system consists of units designed to enhance the
safety, comfort, appearance and to convey necessary equipment to
various hospital areas. The equipment includes electrical
cables, pipes, gas supply, communication and other equipment used
to convey oxygen, compressed air, nitrous oxide, vacuum,
anaesthesia, data processing and nurse call. In addition, there
are two equipment carriers available that can be attached to the
system via tubes, thereby permitting monitors and other equipment
to be repositioned to create improved workplace efficiency. The
following components are included in the system:
1. Ceiling Pipe - It is made of hollow steel and covers
the mounting hole.
2. Single and Double Support Arms - These are pressed
aluminum hollow profiles with specially fitted drilled holes.
3. End Caps - The caps are made of plastic and cover the
joints.
4. Boxes - These are round gas outlets and square
electrical outlet lids and are composed of foamed solidified
plastic.
5. Carrier/Stand - These are painted and stainless steel
articles used below the box.
Initially, the system will be imported fully assembled
from Germany. It is also intended to import the system
unassembled at a future date and to assemble the system in either
the United States or Canada.
The system, whether imported fully assembled or
unassembled, is considered composite goods, consisting of
different materials or made up of different components, which
include not only components attached to each other to form a
practically inseparable whole but also those with separable
components, provided these components are adapted one to the
other and are mutually complementary and that together they form
a whole which would not normally be offered for sale in separate
parts. This item shall be classified as if it consisted of the
material or component which gives it its essential character. In
this instance, the steel units impart the essential character.
The applicable subheading for the DVE 4000 Series modular
design system will be 7326.90.9090, Harmonized Tariff Schedule of
the United States (HTS), which provides for other articles of
iron or steel, other. The duty rate will be 5.7% ad valorem.
Your inquiry also requests information on any differences
in classification that may occur if the unassembled units are
assembled in Canada with the addition of various U.S. made
articles (i.e., gas-outlets and hoses, electric sockets, etc.).
It is noted that the imported units will comprise less than 50%
of the final product as exported from Canada to the U.S. In
general, the following describes the circumstances required for
goods imported from Canada to the U.S. to benefit from the United
States-Canada Free Trade Agreement of 1988.
The United States-Canada Free Trade Agreement
Implementation Act of 1988 (CFTA), provides preferential tariff
treatment for covered goods originating in the territory of
Canada as described in General Note 3(c)(vii), HTS. We call your
attention to General Note 3(c)(vii)(H)(1) which states that,
notwithstanding subdivision (c)(vii)(G), goods described in that
paragraph shall be considered to have been transformed in the
territory of Canada and be treated as goods originating in the
territory of Canada and/or the United States if (1) the value of
materials originating in the territory of Canada and/or the
United States that are used or consumed in the production of the
goods plus the direct cost of assembling the goods in the
territory of Canada and/or the United States constitute not less
than 50 percent of the value of the goods when exported to the
territory of the United States, and (2) the goods have not
subsequent to assembly undergone processing or further assembly
in a third country and they meet the requirements of subdivision
(c)(vii)(E) of this note.
If the merchandise meets these requirements and the
applicable regulations, then goods classifiable under subheading
7326.90.9090, HTS, which originated in the territory of Canada,
will be entitled to a reduced rate of duty under the United
States-Canada Free Trade Agreement.
Goods classifiable under subheading 7326.90.9090, HTS,
which have originated in the territory of Canada, will be
entitled to a 3.4% rate of duty under the United States-Canada
Free Trade Agreement (FTA) upon compliance with all applicable
regulations.
This ruling is being issued under the provisions of
Section 177 of the Customs Regulations (19 C.F.R. 177).
A copy of this ruling letter should be attached to the
entry documents filed at the time this merchandise is imported.
If the documents have been filed without a copy, this ruling
should be brought to the attention of the Customs officer
handling the transaction.
Sincerely,
Jean F. Maguire
Area Director
New York Seaport