CON-9 CO:R:C:E 223789 SR
Mr. John P. Donohue
Donohue And Donohue
Fifth Floor, The Bank Building
421 Chestnut Street
Philadelphia, PA 19106
RE: Temporary Importation under Bond; TIB; destruction;
charitable donation; 9813.00.30, HTSUS
Dear Mr. Donohue:
This is in reference to your letter dated March 3, 1992,
requesting a ruling concerning whether crash tested Volvos can be
donated to charitable donations and be considered destroyed for
Customs purposes.
FACTS:
Volvo North America Corporation plans to import
approximately 50 automobiles to be used for crash testing as a
part of its product safety program. They plan to import the
automobiles temporarily under bond under subheading 9813.00.30,
Harmonized Tariff Schedules of the United States (HTSUS), which
provides for articles intended solely for testing. The crash
testing will destroy the cars and leave them fully inoperable.
Volvo would like to donate the remains of the destroyed
automobiles to rescue squads to use in emergency victim
extraction drills or trade schools for use in teaching the
automobile repair trade. Volvo would receive written commitments
that none of the training could rehabilitate the automobiles for
use or sale.
ISSUE:
Whether donation of automobiles that have been crash tested,
to non-profit organizations, would render the crash testing
insufficient destruction to fulfill the obligation under the
bond.
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LAW AND ANALYSIS:
Under subheading 9813.00.30, HTSUS, articles may be admitted
for testing, experimental or review purposes temporarily free of
duty under bond if they are not imported for sale or for sale on
approval, and they must be exported within one year. U.S. Note
3, Subchapter XIII, HTSUS, provides that upon satisfactory proof
that any article admitted under heading 9813.00.30, HTSUS, has
been destroyed because of its use for any purpose provided for
therein, the obligation under the bond to export such article
shall be treated as satisfied.
The court in American Gas Accumulator Co. v. United States,
56 Treas. Dec. 368, T.D. 43642 (October 29, 1929), in discussing
destruction states the following: ". . . if articles were
destroyed to such an extent that they were only valuable in
commerce as old scrap, they still would be articles of commerce
to which duty attaches upon importation, and therefore, could not
be said to have been destroyed." The fact that there are
organizations that have use for the Volvos indicates that they
could still be considered articles of commerce and could not be
considered to be destroyed according to the definition provided
by the court. Customs has no authority to allow an exception to
the laws.
Recently a similar situation was before Customs, in which an
importer wished to donate merchandise that was entered into the
U.S. temporarily under bond. In this case special legislation
was drafted to allow charitable donation of goods admitted under
a bond. This special legislation provides that the merchandise
must be donated within the year, the donee must pay the amount of
duty that would have been assessed, a penalty will be assessed if
the donee organization sells the merchandise or permits the use
of the merchandise in the production of any article that is sold
or otherwise entered into commerce within a 10 year period. The
donee may destroy the merchandise at any time. Also in the
special legislation is language denying charitable deduction of
the donated merchandise.
HOLDING:
Automobiles that have been crash tested cannot be donated to
a non-profit organization and be considered destroyed for
purposes of a bond under subheading 9813.00.30, HTSUS. We
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suggest that you propose special legislation similar to that
discussed above.
Sincerely,
John Durant, Director