CLA-2-94:OT:RR:NC:N4:433
Paul S. Anderson
The Anderson Law Firm, LLC
111 Barclay Boulevard
Lincolnshire, Illinois 60069
RE: Applicability of the Nairobi Protocol for seat components from China.
Dear Mr. Anderson:
In your letter dated July 10, 2020, on behalf of EDS International, Inc., you requested a binding tariff classification ruling regarding the duty-free entry of seat components under the Nairobi Protocol. In lieu of samples, illustrative literature, a product description, and manufacturing processes were provided.
Item number SRE-30459, identified as the “Backbone Top,” is an aluminum die-cast component forming a partial section to the top frame of a seat backrest. After importation, the individual component is assembled to a seat frame and will provide structural support.
Item number SRE-30460, identified as the “Backbone Base,” is an aluminum die-cast component forming a seat base. After importation, the individual component is assembled to a seat frame and will provide structural support.
Item number SRE-30461R, identified as the “Arm Rest Structure - Right,” is an aluminum die-cast component forming a seat armrest. After importation, the individual component is assembled to a seat frame and will provide structural support.
Item number SRE-30461L, identified as the “Arm Rest Structure - Left,” is an aluminum die-cast component forming a seat armrest. After importation, the individual component is assembled to a seat frame and will provide structural support.
The 4 die-cast components do not form a complete “Stair Lift” seat. Each item is a specific component casted to EDS design specifications that will then be exhausted in the assembly of a seat after importation into the United States. The finished good will be a carriage-mounted seat that will move on an inclined guide rail when installed along a stairway.
The applicable subheading for items 1 thru 4 will be 9401.90.5081, Harmonized Tariff Schedule of the United States, (HTSUS), which provides for “Seats (other than those of heading 9402), whether or not convertible into beds, and parts thereof: Parts: Other: Other: Other.” The rate of duty will be free.
You request classification of items 1 thru 4 in subheading 9817.00.96, HTSUS, which provides for “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 articles: Other.”
Nairobi Protocol
Subheading 9817.00.96, HTSUS, came into effect in the United States through a series of international agreements and acts of Congress. Its basis is in the Agreement on the Importation of Educational, Scientific and Cultural Materials, opened for signature November 22, 1950, 17 U.S.T. 1835, 131 U.N.T.S. 25, or “Florence Agreement,” drafted by the United Nations Educational, Scientific, and Cultural Materials (“UNESCO”) in July of 1950. In 1976, UNESCO adopted the Nairobi Protocol to the Florence Agreement, which expanded the scope of products to include materials specially designed for handicapped persons. See Protocol to the Agreement on the Importation of Educational, Scientific, or Cultural Materials, opened for signature March 1, 1977, 1259 U.N.T.S. 3.
Congress ratified the Nairobi Protocol and enacted it into law in 1983. Pub. L. 97-446, § 161, 96 Stat. 2329, 2346 (1983). The Senate stated in its Report that one of the goals of this law was to benefit the handicapped and show support by the United States for the rights of the handicapped. The Senate was concerned, however, that people would misuse this tariff provision to avoid paying duties on expensive products. As a result, it stated that it did not intend “that an insignificant adaptation would result in duty-free treatment for an entire relatively expansive article . . . the modification or adaptation must be significant so as to clearly render the article for use by handicapped persons.” S. Rep. (Finance Committee) No. 97-564, 97th Cong. 2nd Sess., Sept. 21, 1989.
Section 1121 of the Omnibus Trade and Competitiveness Act of 1988 (Pub. L. No. 100-418, 102 Stat. 1107) and Presidential Proclamation 5978 implemented the Nairobi Protocol by inserting permanent provisions—specifically, subheadings 9817.00.92, 9817.00.94, and 9817.00.96—into the HTSUS. These tariff provisions provide 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. Notes in subchapter XVII of Chapter 98 of the HTSUS define the terms “blind or other physically or mentally handicapped persons” and limit the classification of certain products under subheadings 9817.00.92, 9817.00.94, and 9817.00.96, HTSUS. U.S. Note 4(a), subchapter XVII, Chapter 98, HTSUS, defines the term “blind or other physically or mentally handicapped persons” as “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, excludes four categories of goods from subheadings 9817.00.92, 9817.00.94, and 9817.00.96, HTSUS:
(i) articles for acute or transient disability;
(ii) spectacles, dentures, and cosmetic articles for individuals not substantially disabled;
(iii) therapeutic and diagnostic articles; and,
(iv) medicine or drugs.
As noted above, U.S. Note 4(a), subchapter XVII, Chapter 98, HTSUS, defines the term “blind or other physically or mentally handicapped persons” as “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.” Treasury Decision (T.D.) 92-77 provides further guidance for interpreting this term as follows:
The only ruling by Customs on the issue of what constitutes a “handicapped” person under this statute was HQ 556090, dated November 8, 1991. In this ruling, Customs held that individuals who suffer from chronic arthritis, scoliosis, severe hernia problems and post-polio syndrome and who need heavy-duty support corsets, are “handicapped” within the meaning of the Nairobi Protocol, and therefore, the corsets are eligible for duty-free treatment. However, Customs also held in this ruling that brassieres designed for women who have mastectomies are not eligible for duty-free treatment. Customs determined that women with mastectomies are not substantially limited in any major life activity. The focus of post-operative therapy for women who have had mastectomies is the reassurance that they are fully capable of leading full, productive lives after the operation.
Other physical ailments that CBP has considered to be physical handicaps that limit one or more major life activities include: people who cannot walk (see HQ H024976, dated March 23, 2009 (concerning a wheel chair securement system for motor vehicles)); diabetes (see HQ 561020, dated October 14, 1998 (concerning a diabetes organizer)); hearing loss/impairment (see HQ 563415, dated January 25, 2006 (concerning a carrying case for a hearing aid and its components)); chronic incontinence (see HQ 560278, dated April 7, 1997 (concerning adult pull-on pants)); permanent or chronic pain (see HQ 563002, dated May 26, 2004 (concerning a pouch for holding a pump that would be implanted into the body and deliver medication)); arrhythmia and other heart problems (see HQ 563125, dated December 27, 2004, and HQ 557302, dated March 17, 1993 (concerning pacemakers, defibrillators, and accessories to such medical equipment)); and, people with speech defects (see HQ 088503, dated May 3, 1991 (concerning a speech synthesizer that converted typed words into a synthesized voice)).
The meaning of the phrase “specially designed or adapted” with regard to imported articles has been decided on a case-by-case basis. In HQ 556449, dated May 5, 1992, CBP set forth five factors it would consider in making this case-by-case determination. The same factors are relevant in determining whether a part is “specially designed or adapted” for an article for the use or benefit of handicapped persons. These factors include:
(i) the physical properties of the article itself (i.e., whether the article is easily distinguishable by properties of the design, form, and the corresponding use specific to this unique design, from articles useful to non-handicapped persons);
(ii) whether any characteristics are present that create a substantial probability of use by the chronically handicapped so that the article is easily distinguishable from articles useful to the general public and any use thereof by the general public is so improbable that it would be fugitive;
(iii) whether articles are imported by manufacturers or distributors recognized or proven to be involved in this class or kind of articles for the handicapped;
(iv) whether the articles are sold in specialty stores which serve handicapped individuals; and,
(v) whether the condition of the articles at the time of importation indicates that these articles are for the handicapped.
CBP examines merchandise in the condition as imported. Although certain finished articles qualify for classification in subheading 9817.00.96, HTSUS, the parts of such systems do not automatically qualify. An examination of the parts must occur to determine whether the parts are specially designed or adapted. The documentation you provide explains post-importation U.S. assembly of a seat. The documentation offers no basis of how the four parts possess any distinguishable features to be recognizable as “specially designed or adapted” for the use or benefit of handicapped persons prior to U.S. importation. As a result, the subject parts will not be eligible for the duty free treatment under subheading 9817.00.96, HTSUS.
Trade Remedy
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 9401.90.5081, HTSUS, unless specifically excluded, are subject to an additional 25 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.03, in addition to subheading 9401.90.5081, HTSUS, listed above.
The HTSUS is subject to periodic amendment so you should exercise reasonable care in monitoring the status of goods covered by the Note cited above and the applicable Chapter 99 subheading. For background information regarding the trade remedy initiated pursuant to Section 301 of the Trade Act of 1974, you may refer to the relevant parts of the USTR and CBP websites, which are available at https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions and https://www.cbp.gov/trade/remedies/301-certain-products-china, respectively.
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 the 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 Dharmendra Lilia at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division