Ms. Helen M. Cousineau
Deloitte Tax LLP
111 South Wacker Drive
Chicago, Illinois 60606
RE: The tariff classification of submarine umbilical cables from Norway
Dear Ms. Cousineau:
In your letter dated November 22, 2011, you requested a tariff classification ruling on behalf of your client Nexans Norway AS.
The two items concerned are referred to as submarine umbilical cables. The first model is called the Nakika Main; the second model is called the Nakika Infield. The umbilical cables enable personnel located on an offshore oil and gas production platform to control and operate multiple oil wells, called trees, located on the ocean floor.
The umbilicals incorporate the following key components:
Several stainless steel tubes (approximately 19-25) of less than one inch inside diameter for conveying hydraulic fluids to actuate directional control valves on the wellhead.
Five electrical quads with four electric conductors of copper in each quad. The electric conductors are insulated and consist of four individual conductors stranded into one cable. The conductors have a maximum rating of 1,000 kV.
Two or three tubes with fiber optic elements, used to provide fiber optic communications. The fiber optic elements consist of 24 single-mode optical fibers. All optical fibers are individually sheathed with plastic for increased strength and color marking.
Termination assemblies, which are used to connect the umbilicals to the oil well on the ocean floor. The terminations provide mechanical, electrical and hydraulic interfaces to make the appropriate connections.
The umbilicals act as conduits and consist of combinations of electric conductors, fiber optic telecommunications cable, and pressure-related steel tubes. The electric conductors and the fiber optic cables transmit down-hole pressure and temperature control signals to the subsea oil well tree and manifold systems on the ocean floor. The pressure-rated stainless steel tubes transmit both hydraulic fluids for opening and closing valves on the wellheads and chemical inhibitors that prevent corrosive buildup within the valves.
The submarine umbilical cables are composite goods consisting of various components, insulated electric conductors, pressure-related stainless steel tubes, optical fiber cables and termination assemblies. These cables do not possess one clear function that predominates over the others; as such classification is controlled by GRI 3(c).
The applicable subheading for both submarine umbilical cables, the Nakika Main and the Nakika Infield will be 8544.70.0000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Insulated wire, cable…: Optical fiber cables”. The rate of duty will be Free.
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/.
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 Steven Pollichino at (646) 733-3008.
Robert B. Swierupski
National Commodity Specialist Division