Mr. Adolfo Saldivar
RM Customhouse Brokers, Inc.
4707 E. Montana Avenue, Ste. 201
El Paso, TX 79903
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of LCD color television receivers from Mexico; Article 509
Dear Mr. Saldivar:
In your letter dated October 25, 2010, on behalf of Technology Solution Services, you requested a ruling on the status of LCD color television receivers from Mexico under the NAFTA.
The subject merchandise, based on the submitted information, is LCD color televisions of various screen sizes ranging from 24 inches to 60 inches. It is stated that these LCD television receivers, which do not incorporate any recording or reproducing apparatus, are manufactured in Mexico from non-originating Chinese components consisting of the LCD screen subassembly and the main board subassembly (the mother board). It is stated that these components will be imported in unequal amounts into Mexico in different shipments at different times.
When imported into Mexico, the LCD screen subassembly is composed essentially of the following: the LCD display panel, the front bezel, the rear cover, the power supply, the wire harness, the infrared receiver and the speakers. The LCD screen subassembly, which does not contain a tuner, cannot receive or process a broadcast television signal or other types of video or audio signals.
The main board subassembly, when imported into Mexico, is a printed circuit board that contains all the television control elements, the television tuner, and all the audio and video components. It also incorporates a system chip that receives all incoming video and audio signals from the input ports, decodes and processes the signals, and then sends the video signal to the LCD panel and the audio signals to the speakers, stereo line outs, or headphones. The main board, which does not have a power supply or a display screen, does contain all the components enumerated in Additional U.S. Note 9 to Chapter 85, HTSUS.
In Mexico, the LCD screen subassembly is disassembled in such a way to allow the main board to be incorporated into the LCD screen subassembly with the proper connections and other operations being performed in assembling this merchandise. In this manner, the components are further manufactured to produce a functioning LCD television.
The applicable tariff provision for these LCD color television receivers 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 above-stated 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, these LCD color television receivers 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.
Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs and Border Protection, Regulations & Rulings, 799 9th Street N.W. - 7th floor, Washington, DC 20229-1177.
Robert B. Swierupski
National Commodity Specialist Division