CLA-2-90:OT:RR:NC:N1:135
Mr. Todd Witkum
Insulet Corporation
600 Technology Park Drive, Suite 200
Billerica, MA 01821
RE: The tariff classification of a Personal Diabetes Manager and eligibility for preferential tariff treatment under the Nairobi Protocol from China
Dear Mr. Witkum:
In your letter dated November 17, 2017, you requested a tariff classification ruling.
Descriptive literature was provided with your letter. The Insulet Omnipod Insulin Management system consists of two devices – a disposable insulin delivery device (“POD”) and non-disposable handheld Personal Diabetes Manager (“PDM”) that a patient keeps nearby to wirelessly program his or her insulin delivery. The POD is a small adhesive-backed device with a built-in 200-unit insulin reservoir, angled infusion set, automated cannula insertion mechanism, and power supply. The POD can be attached to a patient’s body anywhere the patient would give him- or herself an injection and can provide up to 3 days of continuous insulin delivery. It is packaged five-to-ten per box. The PDM is a handheld, battery powered, wireless device with a color LCD screen. Some PDMs have a built-in glucometer; some do not. The device is primarily used to activate the POD, and manage insulin delivery settings based on an individual patient’s needs. The PDM must be within five feet of a POD to adjust settings through a custom RF communication protocol. The PDM transmits commands and data to an activated POD and the POD returns data and statuses to the PDM.
In your letter, you requested a ruling only for a classification of the PDMs with and without an incorporated glucometer. The classification of the POD is not part of this ruling request. You suggested classification of both types of the PDMs in subheading 9018.90.7580, Harmonized Tariff Schedule of the United States (HTSUS), which provides for other electro-medical instruments and appliances and parts and accessories thereof. Heading 9018 covers “Instruments and appliances used in medical, surgical, dental or veterinary sciences, including scintigraphic apparatus, other electro-medical apparatus and sight-testing instruments; parts and accessories thereof.” The Explanatory Notes (EN) for heading 9018, HTSUS, states in pertinent part: [t]his heading covers a very wide range of instruments and appliances which, in the vast majority of cases, are used only in professional practice (e.g., by doctors, surgeons, dentists, veterinary surgeons, midwives), either to make a diagnosis, to prevent or treat an illness or to operate, etc. The PDMs are used by patients to wirelessly program their insulin delivery at home. They are more appropriately considered an accessory of the PODs.
The applicable subheading for the Personal Diabetes Managers whether they come with a built-in glucometer or not will be 9021.90.8100, HTSUS, which provides for “Orthopedic appliances, including crutches, surgical belts and trusses; splints and other fracture appliances; artificial parts of the body; hearing aids and other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability; parts and accessories thereof: Other: Other.” The general rate of duty will be Free.
You also requested consideration of the Insulet Omnipod Insulin Management system (the POD and PDM) and their associated parts and accessories under the Nairobi Protocol. 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, HTSUS. 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: parts and accessories (except parts and accessories of braces and artificial limb prosthetics) that are specially designed or adapted for use in the foregoing article" are eligible for duty-free treatment. U.S. Note 4(a), subchapter XVII, Chapter 98, HTSUS, 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."
U.S. Note 4(b), subchapter XVII, Chapter 98, HTSUS, which establishes limits on classification of products in these subheadings, states as follows: (b) Subheadings 9817.00.92, 9817.00.94 and 9817.00.96 do not cover-- (i) articles for acute or transient disability; (ii) spectacles, dentures, and cosmetic articles for individuals not substantially disabled; (iii) therapeutic and diagnostic articles; or (iv) medicine or drugs. The primary issue is whether the Insulet Omnipod Insulin Management system is specially designed or adapted for the “use or benefit of the handicapped” and whether parts and accessories that are specially designed or adapted for use in the foregoing article fall within the meaning of Nairobi Protocol. Although the legislative history of the Nairobi Protocol discusses the concerns of Congress that the design, modification or adaptation of an article must be significant so as to clearly render the article for use by handicapped individuals, no specific definition of these terms was established by Congress. See, Senate Report (Finance Committee) No. 97-564, September 21, 1982). See also, Headquarters Ruling Letter (HRL) 951004 dated March 3, 1992. Since it is difficult to establish a clear definition of what is “specially designed or adapted," various factors must be utilized on a case-by-case basis to determine whether a given article is "specially designed or adapted" within the meaning of this statute.
Based on the information supplied, it is the opinion of this office that a secondary classification will apply for the Insulet Omnipod Insulin Management system (the POD and PDM) and for the POD and PDM when imported separately in subheading 9817.00.96, HTSUS, as “Articles specially designed or adapted for the use or benefit of the blind or other physically or mentally handicapped persons; parts and accessories (except parts and accessories of braces and artificial limb prosthetics) that are specially designed or adapted for use in the foregoing article: Other”, free of duty and the Merchandise Processing Fee (MPF). Note that the requirement that the importer prepare and file a U.S. Department of Commerce form ITA-362P has been eliminated via a notice from the International Trade Administration, published in the Federal Register of June 1, 2010. Also note that this classification has no effect on any quota, visa, or restricted merchandise requirements or countervailing or dumping duties.
You further asked if “their associated parts and accessories” are eligible for classification in subheading 9817.00.96, HTSUS, under the Nairobi Protocol. Our understanding is that you referred to the associated parts and accessories of the POD and PDM. However, your inquiry did not provide enough information for us to determine if “their associated parts and accessories” of the POD and PDM are eligible for classification in subheading 9817.00.96, HTSUS, under the Nairobi Protocol. Your request should clearly identify the specific parts and accessories for which you seek a ruling, and a complete description and picture of each item should be provided. When this information is available, you may wish to consider resubmission of your request.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at https://hts.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Fei Chen at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division