The tariff classification of motor vehicle audio amplifiers from Mexico

N026499 April 29, 2008 CLA-2-85:OT:RR:NC:N1:109 CATEGORY: Classification TARIFF NO.: 9802.00.50 Ms. Katie Zunich Sony Electronics Inc. Manager, Trade Affairs 16530 Via Esprillo, San Diego, CA 92127 RE: The tariff classification of motor vehicle audio amplifiers from Mexico Dear Ms. Zunich: In your letter dated April 23, 2008 you requested a tariff classification ruling. The merchandise subject to this ruling is motor vehicle audio amplifiers. Your letter states that the motor vehicle audio amplifiers are manufactured in Thailand and imported into the United States, at which time applicable duty is submitted in accordance with subheading 8518.40.2000, which is the applicable subheading for this merchandise. The motor vehicle audio amplifiers are ultimately exported to Sony’s Baja California facility, located in Tijuana, Mexico where they will undergo the following processes: 1 – Inspection, 2 – Software review and upgrade as deemed necessary, 3 – System reset, 4 – Attachment of a metal bracket to the motor vehicle amplifier utilizing metal screws, 5 – Testing to insure quality measurements are met, and 6 – Random extensive testing for quality control. The amplifiers contain software, which is installed at the factory in Thailand, that enables the amplifiers to perform optimally in various vehicle models with different acoustic parameters. If a new version of the software becomes available while the audio amplifier is in transit from the factory, or the software is not functioning properly, the software will be reinstalled or upgraded and tested for proper performance. The purpose of putting a bracket on the amplifiers is to facilitate their installation into the vehicle. Space in a vehicle is limited and each model vehicle has a specific location for the amplifier. The bracket allows the amplifier to be affixed to the vehicle in the appropriate location. Currently, there are three different brackets. One of the three types of brackets will be attached to the amplifiers by metal screws, depending upon the vehicle model. You inquire as to whether the motor vehicle audio amplifiers qualify for the partial duty exemption provided for in Subheading 9802.00.50 upon re-importation into the United States after undertaking the aforementioned processes in Mexico. Chapter 98, Subchapter II, U.S. Note 3 (d) states: “For the purposes of subheadings 9802.00.40 and 9802.00.50, the rates of duty in the "Special" sub column of column 1 followed by the symbol "CA" or "MX" in parentheses shall apply to any goods which are returned to the United States after having been repaired or altered in Canada or in Mexico, respectively, whether or not such goods are goods of Canada or goods of Mexico under the terms of general note 12 to the tariff schedule.” The “Special” duty rate column for Subheading 9802.00.50, HTSUS, provides for a free rate of duty for articles that are returned after having been exported to Mexico to be advanced in value or improved in condition by means of repairs or alterations. On the basis of the information submitted, we find that the inspecting, software review and installation, system reset, attachment of metal brackets, quality testing, and random extensive quality control testing performed in Mexico are considered alterations. Therefore, the cost of the alterations of the re-imported motor vehicle audio amplifiers are duty free under subheading 9802.00.50, upon compliance with the documentary requirements of section 10.8, Customs Regulations (19 CFR 10.8). 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 Linda M. Hackett at 646-733-3015. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division