OT:RR:CTF:EPDR
H312750 SLJ
Susanne Cook, Esq.
Dentons, Cohen, and Grigby, P.C.
625 Liberty Avenue
Pittsburgh, PA 15222-3152
RE: Temporary Importation under Bond; Automotive Windshields; United States-Mexico-
Canada Agreement (USMCA)
Dear Ms. Cook:
This is in response to your request for a ruling, dated June 17, 2020, to determine whether
certain windshields are eligible to be entered as a Temporary Importation Under Bond (“TIB”)
under subheading 9813.00.05, Harmonized Tariff Schedule of the United States (“HTSUS”).
This ruling request is submitted on behalf of Pittsburg Glass Works LLC, a member company of
the Vitro Group (“Vitro”).
You requested confidentiality with respect to “certain trade secret and confidential
commercial and financial information relative to costs, OEM customer identifiers and certain
other matters.” For purposes of this request, you provided our office with a public and
confidential version of your request, with all confidential information redacted from the public
version. Inasmuch as this request conforms to the requirements of 19 C.F.R. § 177.2(b)(7), the
request for confidentiality is approved and the information for which confidential treatment has
been requested does not appear in our decision below.
FACTS:
Vitro intends to import seven model numbers of vehicle-specific finished automotive
windshields (“windshields”) from the People’s Republic of China (“China”), and seeks duty free
treatment under TIB subheading 9813.00.05, HTSUS. The windshields are classifiable under
subheading 8708.29.5060, HTSUS, and are subject to Section 301 duties. See Notice of
Modification of Section 301 Action: China's Acts, Policies, and Practices Related to Technology
Transfer, Intellectual Property, and Innovation, 84 Fed. Reg. 20,459 (May 9, 2019); Section
XXII, Chapter 99, Subchapter III, U.S. Note 20(f), HTSUS.
Upon importation, Vitro intends to perform the following operations to the windshields:
add a silane-based primer; attach two locator pins to the inside of the windshield with an
adhesive; add lace molding to the perimeter of the windshield; and add white wiper ticks to mark
the artwork void on the frit. Vitro explains that each of these operations result in bonded
additions to the windshields. For two windshield models, Vitro will additionally attach forward
facing camera (“FFC”) brackets to the center of the windshield. Once all operations are
completed, Vitro will export the windshields to an original equipment manufacturer customer in
Canada. Vitro anticipates some of the windshields may be damaged while completing such
operations, or subsequently during transit to Canada; further, Vitro anticipates excess cuttings of
United States (“U.S.”) origin lace moldings and sticker backings of the locator pins. Vitro notes
that such damaged windshields would be accounted for and asserts that any U.S. origin waste
would not need to be accounted for as waste to fulfill the requirements applicable to merchandise
entered under a TIB.
Vitro notes that the operations to which the windshields will be subjected serve to
enhance the windshields, rendering them more valuable in terms of commercial value and
suitability for purpose. Vitro states that the imported and exported windshields are both
classifiable under subheading 8708.29.5060, HTSUS. Vitro explains that the operations are
designed to render the exported windshields capable of being incorporated into a vehicle by
hiding vehicle wiring and to designate specific locations on the windshield to which accessories
can be affixed. In Vitro’s assessment of the totality of the operations to which the windshields
are subjected within the United States, such operations constitute minor enhancements or
alterations as opposed to a process which results in a manufacture or production of a distinct
article. Based on this assessment, Vitro concludes that the windshields are exported to Canada in
their same condition as at importation into the United States. Vitro further asserts that if U.S.
Customs and Border Protection (“CBP”) disagrees the windshields are exported in the same
condition as at importation, that the duties payable at exportation to Canada pursuant to the
United States-Mexico-Canada Agreement (“USMCA”) exclude Section 301 duties.
Vitro seeks confirmation that: the imported windshields are eligible for duty-free
treatment under TIB subheading 9813.00.05, HTSUS; damaged windshields do not need to be
accounted for as waste; and, windshields exported to Canada are in the same condition as
imported for USMCA purposes or otherwise not subject to Section 301 duties. Our decision
follows.
ISSUES:
I. Whether the imported windshields are eligible for duty-free treatment under subheading
9813.00.05, HTSUS.
II. Whether any damaged windshields must be accounted for as waste.
III. Whether the windshields are exported to Canada in the same condition as at importation
for USMCA purposes, or otherwise not subject to Section 301 duties at exportation.
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LAW AND ANALYSIS:
Pursuant to General Note 1 of the HTSUS, all merchandise imported into the United
States is subject to duty unless specifically exempted. Such an exemption is accorded to
merchandise temporarily imported under bond, that is not imported for sale or for sale on
approval, on the condition that such merchandise is exported or destroyed within a year of
importation. See, e.g., U.S. Notes 1-2 of Subchapter XIII, Chapter 98, HTSUS; 19 C.F.R. §
10.31. This one-year period may be extended for one or more additional periods but may not
exceed three years from the date of importation. See U.S. Note 1(a) of Subchapter XIII, Chapter
98, HTSUS; 19 C.F.R. § 10.37. An application for exportation of merchandise entered under a
TIB may be made on CBP Form 3495, and the fact of exportation is subject to verification. See
e.g. 19 C.F.R. §§ 10.38(a); 10.38(f); 10.39(a).
I. Whether the imported windshields are eligible for duty-free treatment under
subheading 9813.00.05, HTSUS.
Subheading 9813.00.05 of the HTSUS accords duty-free treatment to articles temporarily
imported under bond which are intended to be “repaired, altered, or processed (including
processes which result in articles manufactured or produced in the United States).” A
determination as to whether Vitro’s imported windshields are eligible to be entered under
subheading 9813.00.05, HTSUS, thus hinges on whether the windshields will be altered or
processed. Although the terms “altered” or “processed” are not defined within the HTSUS, or the
regulations governing TIBs in Subpart A of 19 C.F.R. Part 10 (19 C.F.R. §§ 10.31-10.40), these
terms have been defined through various rulings issued by CBP.
In Headquarters Ruling Letter (“HQ”) 224661, dated January 11, 1994, CBP explained
that processing for purposes of subheading 9813.00.05, HTSUS, “can be a relatively minor
procedure or extensive enough to be considered a manufacture or production.” Subsequently, in
HQ 226589, dated March 1, 1996, CBP clarified that historically it has “liberally interpreted
[processing] to include processes which would not otherwise qualify as a manufacture or
production for drawback under 19 U.S.C. 1313(a) or (b).” Such a liberal interpretation is
consistent with the article description for subheading 9813.00.05, HTSUS, which specifically
notes that the term “processed” includes, but is therefore not limited to, “processes which result
in articles [being] manufactured or produced.”
To illustrate, in HQ H300448, dated September 24, 2021, unframed mirrors were
intended to be entered under subheading 9813.00.05, HTSUS. Upon importation the mirrors
would be joined to a frame, after which steel backing and a hanging mechanism would be added.
CBP determined the mirrors were eligible for entry under this subheading because these
processes yielded a finished article. CBP held that importing an unfinished article which is
intended to be assembled with other parts into a finished article qualifies as a process under
subheading 9813.00.05, HTSUS. Citing HQ 224211 (Oct. 20, 1992). Similarly, in HQ 226589,
CBP determined that bare steering wheel frames for automobiles imported to have foam molded
onto the frames were eligible under this subheading. The frames were intended to be exported for
assembly into a finished steering wheel with an air bag. CBP found that the operation of adding
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the foaming and molding the foam to the frame was a process or alteration for purposes of
9813.00.05, HTSUS.
CBP rulings have considered the terms “altered” and “processed” jointly for purposes of
determining eligibility for entry under subheading 9813.00.05, HTSUS. However, in HQ
229970, dated August 11, 2003, CBP provided additional context for the term “altered” by
looking to the dictionary definition of “alter”: “to cause to become different in some particular
characteristic (as measure, dimension, course, arrangement, or inclination) without changing into
something else.” Citing Webster's Third New International Dictionary (unabridged, 1966). CBP
additionally looked to case law pertaining to tempered glass. In Guardian Industries Corp. v.
United States (“Guardian”), the Court of International Trade noted that repairs “and alterations
are made to completed articles and do not include intermediate processing operations which are
performed” to render articles suitable for manufacture and their intended use as a finished article.
3 C.I.T. 9, 12 (1982) (quoting Dolliff & Company, Inc. v. United States, 599 F. 2d 1015, 1019
(1979)). The court focused on the distinction “between ‘alterations’ and manufacturing processes
performed upon articles which are incomplete for their intended use.” Id. at 13. The court opined
that when an operation was intended to render an article suitable for its intended use, such an
operation “was not a mere alteration.” (internal citations omitted). In Guardian, the tempering
process of the annealed glass was necessary for manufacturing a sliding glass door. When
summarizing the court’s decision in HQ 229970, CBP explained that because “the tempering
process transformed the glass in name, use, performance characteristics and tariff classification .
. . it was not an alteration.”
Though a distinction between an alteration and processing need not be identified for
purposes of eligibility under subheading 9813.00.05, HTSUS, to address Vitro’s specific
assessment of the totality of the operations to which the windshields are subjected, we find the
proposed operations are indeed closer to an alteration than a process which results in a
manufacture or production of a distinct article. Vitro plans to subject the imported windshields to
the following operations: adding a silane-based primer; attaching two locator pins to the inside of
the windshield with an adhesive; adding lace molding to the perimeter of the windshield; adding
white wiper ticks to mark the artwork void on the frit; and, for two windshield models, attaching
FFC brackets to the center of the windshield. Such operations will result in the windshields
having bonded additions that will not yield a distinct or new finished article with a different tariff
classification. These bonded additions enable the windshields to fulfill specific purposes which
are incidental to, but not distinct from, their original intended use of being incorporated into a
vehicle: hiding vehicle wiring and designating locations where accessories can be affixed.
Accordingly, such operations alter an article that is already capable of fulfilling its intended use
upon importation. We thus find that Vitro’s proposed operations render the entry eligible for
duty-free treatment under 9813.00.05, HTSUS, for articles intended to be “repaired, altered, or
processed.”
Like the mirrors in HQ H300448 that were eligible to be entered under subheading
9813.00.05, HTSUS, Vitro’s proposed operations are similarly an assembly. In that case, by
adding component parts such as a frame, steel backing, and hanging mechanism, to unframed
mirrors, the assembly constitute a process which yielded a finished article. Comparatively, here,
the assembly does not go so far as to yield a finished article – instead, the assembly renders the
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windshields better suited for their original intended use of being integrated into a vehicle. In the
same way that “alter” was defined in HQ 229970 based on a change in particular characteristics,
these operations alter certain characteristics of the windshields, such as their ability to hide
wiring and designate the locations where accessories can be affixed.
Further, we also find that the operations Vitro plans to perform do not go as far as the
glass tempering in Guardian, where the tempering process described was required to make the
glass fit for its intended purpose. In this case, the operations to which the windshields are
subjected are not a prerequisite to their intended purpose of being integrated into a vehicle. These
operations render the windshields capable of fulfilling additional purposes beyond incorporation
into a vehicle, such as hiding wiring. The windshields maintain their same name, character,
performance characteristics, and tariff classifications as windshields from importation through
exportation. Accordingly, the operations to which the imported windshields will be subjected are
nearer to an alteration rather than a process which results in a manufacture or production of a
distinct article, and the windshields are eligible for entry under subheading 9813.00.05, HTSUS,
for articles intended to be “repaired, altered, or processed.”
II. Whether any damaged windshields must be accounted for as waste.
Pursuant to U.S. Note 2(b)(i) of Subchapter XIII, Chapter 98 of the HTSUS, whenever
merchandise is entered under subheading 9813.00.05, HTSUS, and manufactured, “if any
processing of such merchandise results in a[nother] article . . . manufactured or produced in the
United States . . . a complete accounting . . . for all articles, wastes and irrecoverable losses
resulting from such processing” is required and all articles or valuable wastes must be exported
or destroyed or, in the alternative, duties may be paid on the waste. As explained above, for
purposes of subheading 9813.00.05, HTSUS, processing “include[es but is not limited to]
processes which result in articles manufactured or produced in the United States.”
In deciding whether certain processes constitute a manufacture or production of articles
temporarily entered under bond, CBP has applied the “‘distinctive name, character, and use’
standard.” HQ H198355 (March 7, 2013). In HQ H198355, a company imported a crude
pharmaceutical powder from Japan that was unusable in its crude form. After importation, the
crude powder underwent a micronization or milling process to achieve a fine powder form for
sufficient intestinal permeability. This operation resulted in irrecoverable and valueless waste
when the fine powder remained on the equipment, filters, or was washed away. To determine
whether this waste needed to be accounted for, CBP applied the distinctive name, character, and
use, standard. CBP determined that the micronization process converted the crude powder into a
fine product to achieve sufficient permeability for use in pharmaceutical products. The process
was thus necessary to render the power suitable for its intended use as a pharmaceutical product,
and CBP held that a manufacture had occurred. Consequently, the importer was responsible for
providing a complete accounting of any waste and irrecoverable losses.
In this case, we have already determined that the operations to which Vitro will subject
the windshields eligible to be entered under subheading 9813.00.05, HTSUS, do not result in a
new or different article of commerce that has a different name, character, or use. Unlike the
crude powder in HQ H198355 that could not be used in its crude form at importation as a
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pharmaceutical product without further processing, Vitro’s windshields could still be used for its
intended purpose as a vehicle windshield without alteration through bonded enhancements
facilitating use for incidental purposes such as hiding wiring and designating of locations where
accessories can be affixed. The requirements of U.S. Note 2(b)(i) of Subchapter XIII, Chapter 98
of the HTSUS are thus inapplicable because the operations to which the imported windshields
are subjected do not constitute a manufacture or production yielding a new or different article.
We note that, pursuant to 19 C.F.R § 10.39(c), whenever articles entered under a TIB are
“destroyed within the bond period by death, accidental fire, or other casualty, [a] petition for
relief from liability under the bond” may be filed CBP. Such a petition must “be accompanied by
a statement of the importer, or other person having knowledge of the facts, setting forth the
circumstances of the destruction of the articles.” Additionally, Vitro is required to maintain
records evidencing the exportation or destruction of all imported windshields for purposes of
bond cancellation and in accordance with standard recordkeeping requirements. See, e.g., 19
C.F.R. §§ 10.39; 163.3.
III. Whether the windshields are exported to Canada in the same condition as at
importation for USMCA purposes, or otherwise not subject to Section 301 duties
at exportation.
Pursuant to 19 C.F.R. § 182.53(a)(2)(i)(A), if a “good is imported into the United States
pursuant to a duty-deferral program and is subsequently withdrawn from the duty-deferral
program for exportation to Canada or Mexico . . . and provided that the good is a ‘good subject
to USMCA drawback’ within the meaning of 19 U.S.C. 4534 and is not described in § 182.45 of
this subpart . . . the exported good must be subject to duty.” Accordingly, if an article is imported
into a duty-deferral program in the United States, such as temporary importation under bond, at
subsequent exportation the good will be dutiable so long as it constitutes a good subject to
USMCA drawback that is not identified in 19 C.F.R. § 182.45. Id.; 19 C.F.R. § 182.53(a)(1)(ii).
The term “good subject to USMCA drawback” encompasses “any imported good other than”
specifically listed exceptions. 19 U.S.C. § 4534(a). Such listed exceptions include articles
“exported to a USMCA country in the same condition as when imported into the United States.”
19 U.S.C. § 4534(a)(2).
CBP has previously addressed the above duty deferral requirements, in HQ H332811,
dated February 8, 2024. CBP explained that:
For articles that are not in the “same condition” and are exported to Canada or
Mexico, the [USMCA] duty deferral provisions require an assessment of duty on
the merchandise. Under the duty deferral provisions, withdrawals for exportation
to Canada or Mexico are treated as if the merchandise was entered for
consumption in the United States . . . . Although 19 C.F.R. § 182.45(b) refers to
goods that qualify for drawback under 19 U.S.C. § 1313(j), TIB entries are treated
as a form of “drawback” . . . and the regulations allow the same condition
exemption . . . to be applied to goods entered under a TIB[.]
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(internal citations omitted). If articles entered under subheading 9813.00.05, HTSUS, are not
exported in the same condition as at importation, then when such articles are “subsequently
exported to Canada or Mexico, duty will be assessed . . . on the basis of [their] condition at the
time of its importation into the United States.” 19 C.F.R. § 182.53(b)(5). However, the duties
owed may be “be waived or reduced in an amount that does not exceed the lesser of the total
amount of duty payable [at exportation] or the total amount of customs duties paid to Canada or
Mexico” at subsequent importation. Id.
To determine whether the windshields Vitro intends to export to Canda are exported in
the same condition we must determine whether the windshields were subjected to processes such
as “testing, cleaning, repacking, sorting, marking, or inspecting a good, or preserving.” 19 U.S.C.
§ 4534(a)(2)(A). CBP has expounded upon the definition of “same condition” in 19 C.F.R. §
182.45(b)(1), explaining that it:
includes a good that has been subjected to any of the following operations
provided that no such operation materially alters the characteristics of the good:
(i) Mere dilution with water or another substance;
(ii) Cleaning, including removal of rust, grease, paint or other coatings;
(iii) Application of preservative, including lubricants, protective encapsulation,
or preservation paint;
(iv) Trimming, filing, slitting or cutting;
(v) Putting up in measured doses, or packing, repacking, packaging or
repackaging; or
(vi) Testing, marking, labelling, sorting, grading, or inspecting a good.
In the present case, the following operations are applied to the imported windshields:
adding a silane-based primer; attaching two locator pins to the inside with an adhesive; adding
lace molding to the perimeter of the windshield; adding white wiper ticks to mark the artwork
void on the frit; and attaching FFC brackets to the center of the windshield. The resulting
windshields have bonded additions rendering them capable of hiding wiring and demarking
where accessories may be attached. Such changes to the windshields are not among the
specifically enumerated operations set forth in 19 C.F.R. § 182.45(b)(1). However, CBP has
previously held that this list is informative rather than exhaustive. See HQ 228961 (Jan. 23,
2002); HQ H270737 (Mar. 1, 2017); HQ (Sept. 13, 2021). The “same condition” analysis should
thus focus on whether the article is subjected to an operation which materially alters the
characteristics of the article. See, e.g., HQ 228961 (Jan. 23, 2002); HQ H332811.
For example, CBP has previously determined that cutting and welding finished cable to
fit various sizes of reels met the “same condition” definition because the process consisted of
nothing more than supplying the proper quantity – specifically, by “putting up in measured
doses, or packing, repacking, packaging or repackaging.” HQ 226152 (July 23, 1996). In HQ
H331751, dated November 20, 2024, rolls of aluminum foil were subject to trimming,
unwinding, respooling, and embossing. CBP looked to the Supreme Court’s explanation that “the
words, ‘the same condition,’ mean not only that the identity of the article exported is preserved,
but that its utility for its original purpose is unchanged.” Id. (quoting Belcher v. Linn, 65 U.S.
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533, 534–35 (1860)). CBP determined that not only was the foil subjected to operations
explicitly or implicitly identified in 19 C.F.R. § 182.45(b)(1), but that the totality of the
operations did not materially alter the characteristics of the foil because its original purpose of
wrapping confectionary products remained unchanged.
Conversely, in HQ 225874, dated March 22, 1996, CBP ruled that painting parts with a
color scheme which identifies the company John Deere did not yield parts in the “same
condition” because such painting was distinct from the “preservation paint[ing]” permitted by
regulation. Another example of goods deemed not in the same condition appears in HQ
H270737, dated March 1, 2017, pertaining to pipes. CBP determined that exported bent pipes
were not in the same condition as imported unbent pipes because “[t]he bending process allows
the pipe to be used in applications where a straight pipe cannot – where a change in direction is
required.” Although the importer maintained that bending did not specialize a pipe’s function,
CBP determined that bending constituted a permanent alteration to the pipe’s form. Citing HQ
555417 (Jan. 22, 1990). CBP also stressed that the “fact that the bent pipe is imported and
exported under the same HTSUS subheading [wa]s not determinative” because whether or not
articles are processed so as to affect a change in tariff classification is not conclusive as to
whether the processing changed a material characteristic of the article.
In this case, attaching locator pins via adhesive, adding white wiper ticks to mark the
artwork void on the frit, adding lace molding to the perimeter of the windshield, and attaching
FFC brackets to the center of the windshield are operations that render the windshields fit for
specific uses: hiding the wiring inside a vehicle and identifying locations where accessories may
be attached. However, the identity of the windshield as a windshield remains the same; as with
the aluminum foil in HQ H331751, the windshield maintains its utility for its original purpose.
Unlike the bent pipes in HQ H270737, the proposed operations to the imported windshields do
not enable them to be used for a different purpose or in a different application. Therefore, we
find that the windshields are exported to Canada in the “same condition” as at importation into
the United States, and are thus not a “good subject to USMCA drawback.” 19 U.S.C. §
4534(a)(2). The windshields are thus not dutiable upon exportation.
Finally, we address whether the windshields are subject to Section 301 duties upon
exportation. Section 301 duties generally “do not apply to goods for which entry is properly
claimed under a Chapter 98 provision, HTSUS, including a TIB entered under 9813.00.05,
HTSUS.” However, as explained above, had the windshields not been exported in the “same
condition” to Canada, duties would have been assessed as if the windshields had instead been
entered for consumption and Vitro would have been liable for any applicable Section 301 duties.
See HQ H293258. Due to the windshields being exported in the “same condition,” they are not
dutiable under USMCA’s duty deferral provisions and are thus not subject to duties that would
otherwise be owed under Section 301.
HOLDING:
Based on the above, we find that: the operations to which the windshields are subjected
render them eligible for entry under subheading 9813.00.05, HTSUS; the requirement to account
for waste under U.S. Note 2(b)(i) of Subchapter XIII, Chapter 98, HTSUS, does not apply; and,
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the windshields are exported in the same condition as imported for purposes of duty liability
under the USMCA.
Please note that 19 C.F.R. § 177.9(b)(1) provides that “[e]ach ruling letter is issued on the
assumption that all of the information furnished in connection with the ruling request and
incorporated in the ruing letter, either directly, by reference, or by implication, is accurate and
complete in every material respect.” If any fact in the transaction varies from the facts stipulated
to herein, this decision shall not be binding on CBP, as provided for in 19 C.F.R. § 177.9(b).
Sincerely,
Kristina Frolova, Chief
Entry Process and Duty Refunds Branch
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