CLA-2 CO:R:C:S W556179 SER
District Director
U.S. Customs Service
P.O. Box 791
Great Falls, MT 59403
RE: Internal Advice; classification of components of a hearing aid system and their eligibility for duty-free treatment under subheading 9817.00.96, HTSUSA; parts; Nairobi Protocol
Dear Sir:
This is in reference to your letter dated June 20, 1991, forwarding a request for internal advice pursuant to section 177.11, Customs Regulations (19 CFR 177.11), by the law firm of McDermott, Will & Emery on behalf of Cochlear Corporation, concerning the proper classification of components of a hearing aid system, and the eligibility of the components for duty-free treatment under subheading 9817.00.96, Harmonized Tariff Schedule of the United States Annotated (HTSUSA).
FACTS:
Cochlear imports advanced electro-medical devices for the use by hearing impaired individuals. The merchandise at issue comprises Cochlear's Nucleus 22 Channel Implant System, which is designed for adults and children with postlinguistically acquired bilateral profound hearing loss. The hearing aid implant system consists of three components: an implant device, a speech processor, and a microphone headset. The hearing implant device is surgically implanted in the hearing-impaired individual. It consists of a flexible array of electrodes, which are encompassed in a round, hermetically sealed receiver-stimulator module approximately one inch in diameter, and a connector. The electrode array is extended from the module in the form of a flexible cable which is inserted into the cochlea, a part of the human inner-ear. The implant and electrode array receive information which is transmitted by the microphone and speech processor to the electrodes in the patient's cochlea. Once implanted, the individual may utilize the implant device indefinitely.
The speech processor transforms sound frequencies from the microphone headset into a form suitable for transmission to the implant device. It contains custom integrated circuits, and includes a means for storing information of an individual's frequency thresholds and comfort levels. The speech processor also houses the batteries which provide the energy source for the entire system, as well as the control knobs for on/off functioning and sensitivity. The speech processor may be worn in a shirt pocket, clipped to a belt, or fastened in similar fashion inside or outside one's clothing. The speech processor is individually programmed with information to personalize its function for the specific needs of the individual by whom it is used. There are several models of speech processors, and often new upgraded speech processors are developed which allow individuals to upgrade their hearing systems.
The microphone headset contains the microphone that receives sound information, as well as the coil for sending information and power to the implant device. The microphone headset is available in several different models and colors to suit individual preferences and cosmetic needs. For example, one headset model is held in place by a two wire hair-band style which may be covered by hair making it less visible.
Based on demands for various styles of these components, they are imported and sold separately, as opposed to a prepackaged set.
ISSUE:
Whether the components of the hearing aid system, when entered separately, are eligible for duty-free treatment under subheading 9817.00.96, HTSUSA.
LAW AND ANALYSIS:
The Nairobi Protocol to the Agreement on the Importation of Educational, Scientific, and Cultural Materials Act of 1982, established the duty-free treatment for certain articles for the handicapped. Presidential Proclamation 5978 and Section 1121 of the Omnibus Trade and Competitiveness Act of 1988, provided for the implementation of the Nairobi Protocol into subheadings 9817.00.92, 9817.00.94, and 9817.00.96, HTSUSA. These tariff
provisions specifically state that "(a)rticles specially designed or adapted for the use or benefit of the blind or other physically or mentally handicapped persons" are eligible for duty-free treatment.
U.S. Note 4(a), subchapter XVII, Chapter 98, HTSUSA, states that, "the term 'blind or other physically or mentally handicapped persons' includes any person suffering from a permanent or chronic physical or mental impairment which substantially limits one or more major life activities, such as caring for one's self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, or working." Clearly, individuals who are hard-of-hearing are encompassed by this note.
Customs has previously ruled that the subheadings which encompass the Nairobi Protocol apply to "articles" and not "parts" of articles. See, Headquarters Ruling Letters (HRLs) 087559 dated October 9, 1990, and 086303 dated February 13, 1990. The conclusions reached in these rulings were simply a restatement of the well established principle of Customs law, reiterated by the courts, "that a tariff provision which does not specifically provide for parts does not include parts." Westminster Corp. v. United States, 432 F.Supp. 1055, 1058 (1977), Glass Products, Inc. v. United States, 641 F.Supp. 813, 815 (CIT 1986), Murphy & Co. v. United States, 13 Ct.Cust. Appls. 256, T.D.41201 (1925). As the Court in Westminster further elaborated, "Congress, in enacting legislation, would have provided for parts in [a] provision had it so intended."
Whether particular merchandise is considered a "part" for tariff purposes has been the subject of voluminous judicial examination. The traditional rule in this regard is "that a 'part' of an article is something necessary to the completion of that article. It is an integral part, ..., without which the article to which it is joined could not function as such article." United States v. Willoughby Camera Stores, Inc., 21 CCPA 332, T.D. 46851 (1933), cert. denied, 292 U.S. 640, 54
s.ct. 773, 78 L.Ed. 1492 (1933). However, since a determination regarding whether an item constitutes a "part" is highly fact specific, the courts have modified this standard over the years.
Though the separate components of the hearing aid system are used solely in conjunction with each other, this, in itself, does not establish that any of the components are "parts" of the others. The courts have held that "the mere fact that two articles are designed to be used together is not alone sufficient to establish that either is a part of the other, or of their combined entity." Westfield Manufacturing Company v. U.S., 191 F.Supp. 578 (1961). In addition, the courts have stated that "[m]any ... objects, despite the fact that their usefulness is only in conjunction with other articles, retain a separateness of identity and a functional self-sufficiency which preclude their classification as parts. Furthermore, if an article possesses the characteristics of a completely finished and self contained object ...," it will not be considered a "part". Schick X-Ray
Co. v. U.S. 271 F.Supp. 305 (1967). Similarly, Customs has held that a "part" must be identifiable by shape or other characteristics as an article solely or principally used as a "part". See, HRL 086835 dated April 17, 1990.
Consistent with these holdings, it is our opinion that components of the hearing aid system, even when imported separately and used only in conjunction with each other, do not constitute "parts''ยท The components are not identifiable as items which are solely or principally used as "parts". They retain a recognizable separateness of identity as self contained objects. No one component is associated as a subservient component to the others. Therefore, we find that the components are eligible for duty-free treatment under subheading 9817.00.96, HTSUSA.
HOLDING:
The articles at issue--the implant device, the speech processor, and the microphone headset--which together comprise the Nucleus 22 Channel Implant System for the hearing impaired, are articles specially designed for the handicapped and, therefore, are eligible for duty-free treatment under subheading 9817.00.96, HTSUSA.
9817.00.96, HTSUSA.
Sincerely,
John Durant, Director
Commercial Rulings Division