Mr. German Roman
Wistron Mexico, S.A. de C.V.
Baudelio Perez Mucharra 420
Ciudad Juarez, Chihuahua 32700
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of a LCD color television from Mexico; Article 509
Dear Mr. Roman:
In your letter received in this office on January 29, 2010, you requested a ruling on the status of an LCD color television from Mexico under the NAFTA.
The subject merchandise, being a 42-inch LCD color television receiver (model number VL420M), is manufactured in Mexico from non-originating Chinese components consisting of an LCD panel unit and a mother board (the main board), which are imported separately into Mexico in different shipments at different times.
When imported into Mexico, the LCD panel unit is composed of such components as the LCD module, the front bezel, the rear cover, the power board unit, the wall mount bracket, the chassis, and the shield cover. The LCD panel unit, which does not contain a tuner, cannot receive or process a broadcast television signal or other types of video or audio signals; this unit does contain a screen and a power supply assembly, which are not properly assembled when imported into Mexico.
The mother board, when imported into Mexico, is stated to have such components as an audio/visual unit, an analog tuner, and an audio program decoder. It is also stated that the mother board does contain the necessary circuitry to receive and process television signals or other types of video or audio signals; it also converts broadcast signals to digital signals suitable for LCDs with a progressive set-up.
In Mexico, the LCD panel unit is disassembled in such a way to allow the mother board to be incorporated into the LCD panel unit with the proper wiring done, in addition to other various operations being performed in assembling this merchandise. In this manner, the components are further manufactured to produce a functioning LCD television.
The country of origin determination is made pursuant to 19 C.F.R. 102.11, which states:
The country of origin of a good is the country in which:
The good is wholly obtained or produced;
The good is produced exclusively from domestic materials; or
Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in §102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied.
19 C.F.R. 102.20 specifies that classification under HTSUS provision 8528 allows for a change to subheading 8528.69 through 8528.73 from any other subheading, including another subheading within that group, except from subheading 8540.11 through 8540.12. This tariff shift has been met.
The country of origin of this LCD television is Mexico based upon meeting the tariff shift specified in C.F.R. 102.20.
The applicable tariff provision for this LCD television, model number VL420M, will be 8528.72.72, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Monitors and projectors, not incorporating television reception apparatus; reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus: Reception apparatus for television, whether or not incorporating radio-broadcast receivers or sound or video recording or reproducing apparatus: Other, color: With a flat panel screen: Other: Other. The general rate of duty will be 5 percent ad valorem.
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 http://www.usitc.gov/tata/hts/.
General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that
For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as “goods originating in the territory of a NAFTA party” only if--
(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or
(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--
(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or
(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note.
Based on the facts provided, the merchandise described above qualifies for NAFTA preferential treatment, because it will meet the requirements of HTSUS General Note 12(b)(ii)(A). Moreover, based on the information submitted, the non-originating components will undergo the appropriate change in tariff classification, as required by HTSUS General Note 12 (t)/85.91(H), which reads: “A change to other reception apparatus for television of subheading 8528.72 from incomplete or unfinished reception apparatus for television (including assemblies for reception apparatus consisting of all the parts specified in chapter rule 3 to chapter 85 plus a power supply), not incorporating a cathode-ray tube, flat panel screen or similar display, of subheading 8528.72 or any other heading.”
Thus, this LCD color television, model number VL420M, will be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).
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 Lisa Cariello at (646) 733-3014.
Robert B. Swierupski
National Commodity Specialist Division