Newly Released CBP HQ Rulings for Feb. 24
The Customs Rulings Online Search System (CROSS) was updated Feb. 24 with the following headquarters rulings (ruling revocations and modifications will be detailed elsewhere in a separate article as they are announced in the Customs Bulletin):
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H322417: Country of origin marking of a smartwatch; Section 301
| Ruling: The country of origin is Taiwan and Section 301 measures don't apply. |
| Issue: What is the country of origin for marking purposes of the smartwatch? Is the smartwatch subject to Section 301 measures? |
| Items: A smartwatch comprised of: 1) the case, which includes a touchscreen, the electronic components of the smartwatch, and the enclosure that is designed to protect the components in the case from damage; and 2) the silicon wristband, which is attached to a cradle. |
| Reason: The final assembly process in China involves “screwing, gluing, heating, UV curing, rolling, pressing, fastening, buckling and limited laser soldering with the use of relatively simple tools.” That process isn't a complex or time intensive process. The printed circuit board assembly made in Taiwan is the essence of the smartwatch. |
| Ruling Date: Feb. 23, 2022 |
H319517: Request for Binding Ruling on Classification of Aluminum Hydroxide Surface
| Ruling: Classified in subheading 6810.99.0010 |
| Issue: Whether the aluminum hydroxide surface is classified in heading 2506, HTSUS, as quartz; heading 2818, HTSUS, as aluminum hydroxide; heading 3920, HTSUS, as sheets of plastic; heading 6810, HTSUS, as articles of artificial stone; or heading 6815, HTSUS, as other mineral substances not elsewhere specified. |
| Items: aluminum hydroxide surface |
| Reason: The subject merchandise constitutes an article of artificial stone within heading 6810, HTSUS, because it is an imitation of a marble surface that is created by agglomerating pieces of quartz with other binders -- resin and titanium dioxide. |
| Ruling Date: Feb. 23, 2022 |
H323215: Subheading 9817.00.96, HTSUS; “SmartBrake” and “SmartSteer”
| Ruling: Eligible for duty-free treatment under subheading 9817.00.96 |
| Issue: whether the “SmartBrake” and the “SmartSteer” are eligible for duty-free treatment under subheading 9817.00.96 |
| Items: The “SmartBrake” is an electronic braking system designed for tetraplegic and quadriplegic drivers who cannot use their lower extremities to push the regular brake pedal of a motor vehicle. The “SmartSteer” is an ergonomically designed multifunction spinner knob for disabled persons designed to be installed on the steering wheel of a vehicle. It makes it possible for disabled persons to operate vehicle functions such as windscreen wipers and washer, turn signals, and high and low beams with minimal effort while at the same time keeping control of the steering wheel. |
| Reason: The five factors adopted by the CIT and CBP weigh in favor of a determination that the “SmartBrake” and “SmartSteer” are “specially designed” for the use or benefit of disabled persons with inability to use all four limbs to an extent greater than for the general public. |
| Ruling Date: Feb. 18, 2022 |
H302184: Internal Advice Request; Transaction Value; Service Fees; Royalties and License Fees
| Ruling: The payments at issue are not dutiable under the proceeds provision. |
| Issue: Whether the service fee payments that the importer makes to the parent are included in the transaction value of the imported merchandise as part of the price actually paid or payable, or whether they constitute additions to the price actually paid or payable under 19 U.S.C. § 1401a(b)(1). Whether the royalty payments that the Importer makes to the Related Licensor constitute additions to the price actually paid or payable under 19 U.S.C. § 1401a(b)(1). |
| Items: The Importer is a wholly-owned subsidiary of the Parent, a foreign entity that develops, produces, and sells flavors and fragrances. According to the information provided, the Importer manufactures thousands of products from raw materials such as vanilla, citrus products, or plant and flower materials. Its customers include companies in the perfume, cosmetics, and food industries, as well as manufacturers of household products. The Importer made additional payments to the Parent for service fees and to the Related Licensor for royalty fees, and neither of these payments was included in the declared value of the imported merchandise. |
| Reason: The royalty payments at issue are not based on the resale of the imported merchandise. Instead, they are based on merchandise that is manufactured in the United States which may or may not contain the imported merchandise. Additionally, in accordance with sections 1.5 and 9.6 of the license agreement, any imported merchandise that is resold in its condition as imported does not generate a royalty payment. Accordingly, the payments at issue are not dutiable under the proceeds provision. |
| Ruling Date: Dec. 7, 2021 |
H322719: Restricted Merchandise
| Ruling: The item is drug paraphernalia and is prohibited from import. |
| Issue: Whether The LitKit falls within the meaning of drug paraphernalia pursuant to 21 U.S.C. § 863. |
| Items: An accessory to stick to the back of a cell phone with multiple components. |
| Reason: The “Plinko board” component of The LitKit appears to be an herb grinder, which can be used for legitimate uses such as grinding tobacco or herbs, or for illegitimate uses such as grinding marijuana buds for consumption The “knob that can be spun for enjoyment” appears to be a grinding nub, making the “Plinko board” functionable as a grinder. There is also a compartment at the base of the “Plinko board” that could hold ground marijuana. Marijuana grinders advertised online have cranks similar to the “knob,” as well as a compartment for storage similar to The LitKit’s compartment. See, e.g. GTVOK, “Best Crank Weed Grinder -- Reviews & Buying Guide,” |
| Ruling Date: Feb. 23, 2021 |