ITC Issues Final Report on Proposed HTS Changes for January 1, 2007 (Part III)

This final report, entitled, Proposed Modifications to the Harmonized Tariff Schedule of the U.S., is part of ITC investigation number 1205-6 which was instituted in September 2004, in conjunction with the third review cycle of the International Convention on the Harmonized Commodity Description and Coding System (HS).

This is Part III of a multi-part series of summaries on the ITC's final report. Part III discusses proposed modifications to the HTS that were requested by U.S. Customs and Border Protection (CBP) in light of certain decisions taken by the Harmonized System Committee (HSC) that did not change the international HS, but which were counter to established U.S. Customs practices and/or U.S. court rulings. According to ITC sources, these proposed changes would preserve current duty rate treatment while complying with the HSC's decisions. See future issues of ITT for additional summaries.

ITC Discusses Proposed HTS Changes Requested by CBP

In its final report, the ITC discusses several proposed HTS modifications that were requested by CBP in light of certain HSC decisions, as follows (see ITC report for complete details):

Drilled or notched lumber. CBP indicated that drilled or notched lumber studs had been classified by the HSC as builders' joinery in HS 4418, whereas CBP's practice was to classify such products in HTS 4407. In order to conform to the decision, CBP asked that an additional U.S. note (AUSN) be inserted in the HTS to provide a legal basis for the classification in HTS 4418, and that a separate rate line for drilled or notched lumber studs be inserted in HTS 4418 to carry over the established duty treatment from HTS 4407. The ITC states that these amendments are reflected in appendix B of this final report.

Safety seats for infants and toddlers. As indicated by CBP, the HSC had classified certain child safety seats, not as "seats of a kind used for motor vehicles" (HS 9401.20), but rather as "other seats" of HS 9401.80. CBP requested an AUSN to provide legal clarification of this classification in the HTS. Given that the duty rate involved is "free" in either case, CBP did not ask for a separate rate line for child safety seats under HS 9401.80, but did ask that the statistical annotation for such seats under the present HS 9401.20 be maintained in the 2007 HTS under HTS 9401.80.

Certain hygienic articles of plastics. The ITC states that given that the HSC has agreed that hygienic articles of plastics should be classified together in HS 3924, certain hygienic articles traditionally classified by CBP in HTS 3926 would be transferred after January 1, 2007. To reflect these transfers, CBP requested a new subheading for "nursing nipples and finger cots" under HTS 3924, as well as amendments to the article descriptions for existing HTS 3926.90.15 and 3926.90.20. These two subheadings will be renumbered in 2007 to indicate a change in their scope. CBP also noted that "crutch tips and grips" (in existing HTS 3926.90.20) were more properly classifiable in HTS 9021. The ITC states that it has not proposed a separate subheading for these products in HTS 9021, but merely indicated the transfer by renumbering the residual or "basket" subheading to HTS 9021.90.81 (from 9021.90.80) to reflect a change in scope of that subheading.

Multilayer parquet panels. The HSC considered the classification of certain multilayer flooring panels, consisting of 2 or 3 layers, the face layer being finished wood measuring 4 mm in thickness. The ITC states that the HSC classified the products as builders' joinery in HS 4418, despite the U.S. argument that they met the criteria for veneered or laminated wood panels of HS 4412. According to the ITC, the established Customs practice of classifying these products in heading 4412 was consistent with the Boen Hardwood Flooring Inc. v. U.S. In order to have a legal basis for following the HSC decision in this regard, CBP asked for a new AUSN note 4 to HTS Chapter 44 (see appendix B of this final report) as well as new rate lines in HTS 4418 to cover the products in question. (See ITT's Online Archives or 03/11/04 news, 04031140, for BP summary of the Boen court decision.)

Photo frame albums. Though CBP had a long history of classifying photo albums of plastics as household articles of HTS 3924, the HSC recent classified two different samples of such albums in HS 3926 (other articles of plastics). Here again, CBP requested an AUSN to chapter 39 and a new rate line for photo albums in HTS 3926, in order to provide a sufficient legal basis for classifying these goods in that heading.

(See ITT's Online Archives 06/08/06 and 06/09/06 news, 06060815 and 06060915, for Parts I-II of BP summary of the ITC's final report on these proposed changes. See ITT's Online Archives or 04/25/05 and 04/26/05 news, 05042505 and 05042610, for Parts I and II of BP summary on the ITC's preliminary report.

See ITT's Online Archives or 08/30/05 news, 05083005, for BP summary of ITC's request for proposals to amend the international HS in 2012.)

ITC Final Report (Inv. No. 1205-6 (Final), USITC Publication 3851, dated April 2006) available at http://hotdocs.usitc.gov/docs/tata/hts/Pub3851.pdf