CBP Applied Wrong HTS Subheading on Electronic Wiring Surfaces, Adding 301 Duties, Importer Argues

CBP failed to apply an Office of the U.S. Trade Representative-granted Section 301 exclusion for "flexible pressure sensitive LCD display devices used as a surface for electronic wiring" to importer Kent Displays' merchandise, the importer told the Court of International Trade in an Oct. 27 motion for summary judgment. Kent argued that its Model WT16312 Dashboard is the type of device as described by the exclusion and, as such, should be free of the 25% Section 301 duties under Harmonized Tariff Schedule subheading 9013.80.7000 (Kent Displays v. United States, CIT # 20-00156).

Kent said its product is a battery-powered electronic eWriter device with a flexible pressure sensitive liquid crystal writing film serving as its essential component. In 2019, USTR granted an exclusion from Section 301 tariffs at the importer's request for goods under subheading 9013.80.7000.

However, on import, CBP denied Kent's protest seeking the exclusion, finding that the goods in question are electrical devices with an individual function more properly fitted under HTS subheading 8543.70.9860, which covers other electrical machines, "having individual functions, not specified or included elsewhere in this chapter."

At the trade court, Kent now argues that it was reasonable for the company to tell USTR that its products were classified under HTS subheading 9013.80.7000 "based on its reasonable belief and because that is how the goods had been entered and liquidated by CBP." The importer added that if the court should find CBP's preferred classification preferable, the court should say the products fall under subheading 8543.70.9860 "free of Section 301 duty" since at the time of import, goods under this subheading were not subject to those duties.