CLA-2-85:OT:RR:NC:N1:109
Meredith DeMent
Baker and McKenzie LLP.
815 Connecticut Avenue N.W.
Washington, DC 20006
RE: The tariff classification of a sound system from an unspecified country of origin
Dear Ms. DeMent:
In your letter dated August 26, 2015, you requested a tariff classification ruling on behalf of your client, Turtle Beach Corporation.
The item concerned is referred to as the “HyperSound Clear 500P System.” This device is an audio sound system comprised primarily of an amplifier and two speakers. The HyperSound System is used to amplify audio frequency input and project sound waves along a narrow ultrasonic beam of energy. This method of amplification and sound projection creates a highly directional and intelligible sound over a greater distance than traditional sound systems.
Unlike traditional audio speakers which radiate audible sound in all directions, the HyperSound System uses software to electronically mix audible tones with ultrasonic waves that act as a carrier for the audible sound. Sound is not generated at the surface of the speakers. Rather, sound is generated in the air as the audible sound waves demodulate within and along the conical ultrasonic beam. This results in a focused, directional delivery of sound, similar to the focused beam of light emitted from a flashlight. Individuals standing outside the narrow, conical beam of sound are unable to hear most of the sound carried within the ultrasonic beam.
The “HyperSound Clear 500P System” is a hearing aid that produces high-quality, focused sound within a conically-shaped beam, employing ultrasonic frequencies ranging from 96 kilohertz to 116 kilohertz to deliver improved sound clarity and speech intelligibility to individuals with hearing loss. The system is designed to be used by hearing impaired individuals in their homes with their home theater systems to improve their understanding and enjoyment of music, television, and movies without the use of headphones and without disrupting these experiences for individuals with normal hearing.
The“HyperSound Clear 500P System” is specifically adapted to individuals with hearing loss. Unlike traditional audio sound systems, the HyperSound System improves the clarity of sound and focuses that sound along a directional, ultrasonic beam to deliver sound to a specific, targeted individual while reducing the effects of background noise and interference. Additionally, the HyperSound System is programmable and customizable by a hearing professional to a listener’s hearing profile and preferences, as described above.
The HyperSound System will be marketed to individuals with hearing loss and will only be available for purchase through hearing loss professionals, such as audiologists and otologists. It will not be available at traditional consumer retail outlets.
The applicable subheading for the “HyperSound Clear 500P System” will be 8518.40.2000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Audio frequency electric amplifiers: Other.” The general rate of duty will be 4.9%.
You also request for consideration of the instant product under the Nairobi Protocol.
Specifically, you ask whether the “HyperSound Clear 500P System” is "specially designed or adapted" for the handicapped within the meaning of the Nairobi Protocol, and, therefore, eligible for duty-free treatment under subheading 9817.00.96, HTSUSA. 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." U.S. Note 4(b), subchapter XVII, Chapter 98, HTSUSA, 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 article is specially designed or adapted for the “use or benefit of the handicapped” 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 “HyperSound Clear 500P System” in subheading 9817.00.96, HTSUS, as specially designed or adapted for the use or benefit of the permanently or chronically physically or mentally handicapped, free of duty and user fees (if any). 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.
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 [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division