CSMS Message: 99-000721

TO : ALL ABI BROKERS.

FROM : JIM H. TOKMENKO

SUBJECT : HTS- ABI DAILY MESAGE

DATE : 09/01/1999

ABI DAILY MESSAGE

THE PURPOSE OF THIS ABI DAILY MESSAGE IS CALL ATTENTION TO A
PATTERN OF DISCREPANCIES AND NON-COMPLIANCE INVOLVING HTS 8459
WHICH HAVE LED TO AN UNACCEPTABLE COMPLIANCE RATE IN THE PAST
SEVERAL FISCAL YEARS. HTS HEADING 8459 COVERS MACHINE TOOLS
MACHINE TOOLS FOR DRILLING, BORING, MILLING, THREADING OR
TAPPING BY REMOVING METAL, OTHER THAN LATHES OF HEADING 8458.
MACHINE TOOLS OF HTS HEADING 8459 MUST WORK METAL, AND INCLUDE
WAY-TYPE UNIT HEAD MACHINES. THESE MACHINES, HAVE NO ATTACHED
BASE. THEY CONSIST ONLY OF A "FRAME" HOLDING A MOTOR AND TOOL
HOLDER AND ARE EQUIPPED WITH GUIDES AND CAN THEREFORE MOVE BACK
AND FORTH REPETITIVELY WHEN PLACED ON A SUITABLE BASE. THE
WORKPIECE IS INSERTED IN A WORK HOLDER INDEPENDENT OF THE WAY
TYPE UNIT HEAD MACHINE WHICH MOVES BACK AND FORTH HORIZONTALLY
FOR DRILLING, BORING, ETC.

RESEARCH CONDUCTED BY THE U.S. CUSTOMS STRATEGIC TRADE CENTER IN
SOUTH FLORIDA, WHICH HAS INCLUDED A REVIEW OF ALL NON-COMPLIANT
IMPORTATIONS OF MACHINE TOOLS UNDER HTS 8459, IMPORTED FROM
JUNE1, 1998, THROUGH MAY, 31,1999, HAS IDENTIFIED SEVERAL
SIGNIFICANT PATTERNS TO THESE DISCREPANCIES:

(1) MACHINE PARTS AND ACCESSORIES ARE NOT PROVIDED FOR
WITHIN HTS HEADING 8459. THEREFORE, IF AN IMPORTED SHIPMENT
CONTAINS NO MACHINES, JUST PARTS AND ACCESSORIES FOR THE
MACHINES, THESE PARTS AND ACCESSORIES MUST NOT BE CLASSIFIED
UNDER HTS 8459, AND SHOULD BE INDIVIDUALLY CLASSIFIED
ELSEWHERE WITHIN THE HARMONIZED TARIFF SCHEDULE.
WHEN CLASSIFYING THESE PARTS AND ACCESSORIES, IMPORTERS
MUST ABIDE BY THE RELEVANT SECTION NOTES AND CHAPTER NOTES
TO THE HARMONIZED TARIFF SCHEDULE SINCE THESE NOTES PROVIDE
THE LEGAL GUIDANCE AS TO WHAT ITEMS CAN AND CANNOT BE CLASSIFIED
UNDER SPECIFIC TARIFF HEADINGS. FOR EXAMPLE, HTS SECTION XVI
NOTE 1(G) STATES THAT PARTS OF GENERAL USE, SUCH AS
NUTS, BOLTS, SCREWS, AND SPRINGS, ARE EXCLUDED FROM
CLASSIFICATION UNDER HTS CHAPTERS 84 AND 85, AND MUST BE
CLASSIFIED UNDER THEIR OWN APPROPRIATE HEADING.

MANY MACHINE PARTS AND ACCESSORIES FOR THE MACHINES
COVERED BY HTS 8459 MAY BE CLASSIFIED UNDER HTS 8466,
UNLESS THESE PARTS AND ACCESSORIES ARE SPECIFICALLY
PROVIDED FOR ELSEWHERE WITHIN THE HARMONIZED TARIFF
SCHEDULE. IMPORTERS SHOULD REMEMBER, THAT IN ACCORDANCE
WITH THE GENERAL RULES OF INTERPRETATION AND ANY RELEVANT
LEGAL NOTES, CERTAIN MACHINE PARTS ARE ALWAYS CLASSIFIED
IN THEIR OWN APPROPRIATE TARIFF HEADING, EVEN IF
SPECIALLY DESIGNED TO WORK AS PART OF A SPECIFIC
MACHINE. EXAMPLES INCLUDE BEARINGS, MOTORS, PUMPS,
VALVES, CONTROLS, AND MEASURING DEVICES. ADDITIONAL
EXAMPLES OF MACHINE PARTS WHICH ARE ALWAYS CLASSIFIED IN
THEIR OWN APPROPRIATE TARIFF HEADING, EVEN IF SPECIALLY
DESIGNED TO WORK AS PART OF A SPECIFIC MACHINE, CAN BE
FOUND IN THE SECTION XVI NOTES TO THE HTS, AND ON PAGE
1225 OF THE EXPLANATORY NOTES .

IF THE IMPORTED SHIPMENT CONSISTS OF MACHINES ONLY, YET
THE IMPORT INVOICE FOR THE MACHINE LISTS A BASE PRICE
AND SEPARATELY LISTS VARIOUS OPTIONS OR ACCESSORIES
PROVIDED WITH THE MACHINE, THE ITEMS REMAIN
CLASSIFIED WITH THE MACHINE IN HTS 8459. IF THE IMPORTED
MACHINES CONTAIN SPARE PARTS, THESE SPARE PARTS MUST BE
SEPARATELY IDENTIFIED ON YOUR INVOICE AND SEPARATELY
CLASSIFIED.

(2) HAND HELD ELECTRIC DRILLS FOR WORKING IN THE HAND,
EITHER PNEUMATIC OR WITH SELF-CONTAINED
NON-ELECTRIC MOTORS, SHOULD BE CLASSIFIED UNDER HTS 8467
OR 8508. THESE TYPES OF HAND TOOLS ARE OFTEN
MISCLASSIFIED MACHINE TOOLS UNDER HTS 8459.

(3) OTHER DISCREPANCIES INCLUDE FAILURE TO PROPERLY MARK
IMPORTED GOODS WITH THE COUNTRY OF ORIGIN.

(4) SEPARATELY IMPORTED TOOL HOLDERS OR DIEHEADS FOR
MACHINES OF HTS 8459 ARE OFTEN FOUND MISCLASSIFIED AS A
MACHINE UNDER HTS HEADING 8459. TOOL HOLDERS ARE PROVIDED
FOR UNDER HTS 8466.10, WHILE WORK HOLDERS ARE CLASSIFIED
UNDER 8466.20.

(5) MACHINING CENTERS OF HTS 8457.10 ARE COMMONLY
MISCLASSIFIED AS MILLING MACHINES OR AS COMBINATION
BORING MILLING MACHINES UNDER HTS HEADING 8459.
ADDITIONALLY, MULTISTATION TRANSFER MACHINES UNDER HTS
8457.30 ARE ALSO MISCLASSIFIED UNDER HTS HEADING 8459.

(6) KNEE TYPE MILLING MACHINES UNDER HTS 8459.51.00 OR
HTS 8459.59.00 ARE MISCLASSIFIED AS OTHER MILLING
MACHINES UNDER HTS 8459.61 OR HTS 8459.69. THESE TYPES OF
DISCREPANCIES MAY BE CAUSED BY INSUFFICIENT INVOICES.

(7) SEPARATELY IMPORTED INTERCHANGEABLE TOOLS FOR MACHINE
TOOLS UNDER HEADING 8207, SUCH AS END MILLS, TWIST DRILLS
ETC., ARE OFTEN FOUND MISCLASSIFIED UNDER HEADING 8459.

(8) NUMERICALLY CONTROLLED MACHINES ARE CLASSIFIED AS
NON-NUMERICALLY CONTROLLED; USED MACHINES ARE CLASSIFIED
AS NEW; MACHINES VALUED UNDER $3,025 ARE CLASSIFIED AS
MACHINES VALUED OVER $3,025. THESE TYPES OF
DISCREPANCIES ARE EASILY AVOIDED IF THE INVOICE IS
SUFFICIENT, AND THE IMPORTER/BROKER USES REASONABLE CARE
WHEN CLASSIFYING THE IMPORTED MERCHANDISE. (** NOTE: A
COMPUTER NUMERICAL CONTROL, OR CNC, IS ESSENTIALLY A
MICROPROCESSOR BASED CONTROL FOR CONTROLLING THE
COORDINATED MOTIONS AND FUNCTIONS OF A MACHINE.)

ON AUGUST 26,1999, THE SOUTH FLORIDA STRATEGIC TRADE CENTER
ISSUED INFORMED COMPLIANCE LETTERS TO 322 SIGNIFICANT IMPORTERS
OF MACHINE TOOLS HTS HEADING 8456 COVERS MACHINE TOOLS MACHINE
TOOLS FOR DRILLING, BORING, MILLING, THREADING OR TAPPING BY
REMOVING METAL, OTHER THAN LATHES OF HEADING 8458, ALL OF WHICH
ARE CLASSIFIABLE UNDER HTS 8459. THE PURPOSE OF THESE LETTERS
WAS TO INFORM THE IMPORTERS OF OUR CONCERNS AND THE CURRENT
TREND OF DISCREPANCIES. THESE FIRMS WERE ALSO NOTIFIED THAT IF
THEIR COMPANY=S INDIVIDUAL IMPORT TRANSACTIONS ARE NOT FREE FROM
THESE TYPE OF ERRORS OUTLINED IN THE LETTERS, AND THEY DO NOT
TAKE IMMEDIATE CORRECTIVE ACTIONS DESIGNED TO FOSTER COMPLIANCE,
THEIR COMPANY COULD FIND ITSELF SUBJECT TO INCREASED ENTRY
REVIEWS AND/OR CARGO EXAMINATIONS, PENALTIES, OR OTHER REMEDIAL
ACTIONS.

THIS ABI DAILY MESSAGE IS BEING PROVIDED TO HELP MAXIMIZE
COMPLIANCE AND AVOID THE ERRORS WHICH ARE COMMON TO MERCHANDISE
CLASSIFIED UNDER HTS 8459. FOR FURTHER INFORMATION, PLEASE
CONTACT THE IMPORT SPECIALISTS AT YOUR LOCAL PORT OF ENTRY, OR
INTERNATIONAL TRADE SPECIALIST MICHELLE NUALART AT THE SOUTH
FLORIDA STRATEGIC TRADE CENTER AT (954) 327-2806.