CLA-2 CO:R:C:S 557178 MLR
Mr. Ed Baker
A.N. Deringer, Inc.
30 West Service Road
Champlain, New York 12919-9703
RE: Applicability of partial duty exemption under HTSUS
subheading 9802.00.80 to vacuum system hoses;
classification; connectors
Dear Mr. Baker:
This is in reference to your letter of February 8, 1993, on
behalf of Tiger-Vac, Inc., requesting a ruling regarding the
tariff classification and marking requirements of vacuum system
hoses, and the applicability of subheading 9802.00.80, Harmonized
Tariff Schedule of the United States (HTSUS). The country of
origin marking issue will be addressed in a separate letter. A
diagram of the articles was submitted with your request.
FACTS:
Tiger-Vac plans to import static dissipating neoprene,
explosion proof, vacuum system hoses from Canada. U.S.-origin
flexible neoprene hose (measuring 10 inches long by 1 1/2 inches
(38 millimeters) in diameter, and permanently embedded and
continuously repeated throughout the length of the hose with
"Lawrence 2752-SAE J1527 USCGTYPEA2 Made in USA") will be
imported into Canada in 50 foot coils, where it is cut to 10 feet
lengths. In Canada, a stainless steel male connector, measuring
1 1/2 inches in diameter and made in the U.S., is force fitted to
one end of the hose. On the other end of the hose, a metal
female adaptor assembly is connected. The metal female adaptor
is formed by permanently attaching one Taiwanese-origin adaptor
to a 2 inch Canadian-origin piece of aluminum tubing.
ISSUES:
I. What is the proper classification of the vacuum system hoses
under the HTSUS?
II. Whether the U.S. components in the vacuum system hoses will
qualify for the duty allowance under HTSUS subheading
9802.00.80, when imported into the United States.
LAW AND ANALYSIS:
I. Classification
The classification of merchandise under the HTSUS is
governed by the General Rules of Interpretation (GRI's). GRI 1,
HTSUS, states, in part, that "for legal purposes, classification
shall be determined according to the terms of the headings and
any relative section or chapter notes...."
Note 2, Section XVI states, that "parts of machines (not
being parts of the articles of heading 8484, 8544, 8545, 8546 or
8547) are to be classified according to the following rules:
(a) Parts which are goods included in any of the headings of
chapters 84 and 85 (other than headings 8485 and 8548) are
in all cases to be classified in their respective headings;
(b) Other parts, if suitable for use solely or principally with
a particular kind of machine, or with a number of machines
of the same heading (including a machine of heading 8479 or
8543) are to be classified with the machines of that kind.
However, parts which are equally suitable for use
principally with the goods of headings 8517 and 8525 to 8528
are to be classified in heading 8517;
(c) All other parts are to be classified in heading 8485 or
8548."
The information submitted indicates that the hose is
manufactured according to specification for use with Tiger-Vac's
vacuum, Model# EXP1-25. There is no indication that the parts
will have use in any other application. The hose at issue is not
a part included in any of the headings in chapters 84 and 85.
Therefore, it cannot be classified pursuant to Note 2(a), Section
XVI, HTSUS. However, inasmuch as the hose is a part suitable for
use solely or principally with a vacuum, it is classified
pursuant to Note 2(b), Section XVI, HTSUS. Therefore, the hose
is properly classified under subheading 8509.90.20, HTSUS, which
provides for "Electromechanical domestic appliances, with self-
contained electric motor; parts thereof...Parts...Parts of vacuum
cleaners...."
II. Subheading 9802.00.80, HTSUS
Subheading 9802.00.80, HTSUS, provides a partial duty
exemption for:
[a]rticles assembled abroad in whole or in part of
fabricated components, the product of the United
States, which (a) were exported in condition ready for
assembly without further fabrication, (b) have not lost
their physical identity in such articles by change in
form, shape, or otherwise, and (c) have not been
advanced in value or improved in condition abroad
except by being assembled and except by operations
incidental to the assembly process, such as cleaning,
lubricating and painting.
All three requirements of subheading 9802.00.80, HTSUS, must be
satisfied before a component may receive a duty allowance. An
article entered under this tariff provision is subject to duty
upon the full cost or value of the imported assembled article,
less the cost or value of the U.S. components assembled therein,
upon compliance with the documentary requirements of section
10.24, Customs Regulations (19 CFR 10.24).
Section 10.14(a), Customs Regulations {19 CFR 10.14(a)},
states in part that:
[t]he components must be in condition ready for
assembly without further fabrication at the time of
their exportation from the United States to qualify for
the exemption. Components will not lose their
entitlement to the exemption by being subjected to
operations incidental to the assembly either before,
during, or after their assembly with other components.
Section 10.16(a), Customs Regulations {19 CFR 10.16(a)},
provides that the assembly operation performed abroad may consist
of any method used to join or fit together solid components, such
as welding, soldering, riveting, force fitting, gluing,
lamination, sewing, or the use of fasteners.
Operations incidental to the assembly process are not
considered further fabrication operations, as they are of a minor
nature and cannot always be provided for in advance of the
assembly operations. See 19 CFR 10.16(a). However, any
significant process, operation or treatment whose primary purpose
is the fabrication, completion, physical or chemical improvement
of a component precludes the application of the exemption under
subheading 9802.00.80, HTSUS, to that component. See 19 CFR
10.16(c).
The operations of force fitting the stainless steel male
connector to one end of the flexible neoprene hose, and a metal
female adaptor assembly to the other end of the hose, are
considered acceptable assembly operations pursuant to 19 CFR
10.16(a) for purposes of subheading 9802.00.80, HTSUS. Cutting
the hose to lengths of 10 feet is considered an acceptable
operation incidental to assembly pursuant to 19 CFR 10.16(b)(6).
HOLDING:
The vacuum hose is classified under subheading 8509.90.20,
HTSUS, which provides for parts of vacuum cleaners, with duty at
the Column 1 rate of 3.4 percent ad valorem.
Subheading 8509.90.20, HTSUS, is an eligible tariff
provision for preferential treatment under the United States-
Canada Free Trade Agreement (CFTA). If the article is deemed to
be goods originating in the territory of Canada, pursuant to
General Note 3(c)(vii), HTSUS, it will be dutiable at the rate of
1.7 percent ad valorem.
Furthermore, the process of connecting the stainless steel
male connector and the metal female adaptor assembly to the
opposite ends of the hose constitute acceptable assembly
operations. Cutting the hose to length is an acceptable
incidental operation. Therefore, allowances in duty may be made
under subheading 9802.00.80, HTSUS, for the cost or value of the
U.S.-origin stainless steel male connector and flexible neoprene
hose contained in the vacuum system hoses, provided the
documentary requirements of 19 CFR 10.24 are satisfied.
Sincerely,
John Durant, Director
Commercial Rulings Division
cc: Chief, Glass and Metals Branch
New York Seaport
(Attn: James Smyth, NIS)