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| 7th Report of Market Access Ombudsman Council (March 18, 2002) |
1. Complainant: South Korean Embassy
2. Ministry concerned: Ministry of Finance
3. Complaint:
With regard to carpeting automobiles, those "of size and shape suitable for incorporation in motor vehicles" are subject to no duty, but other articles are subject to a 9.6% tariff.
Our client in Japan requests that our carpeting for automobiles be delivered in rolled form. Since it is clear from the materials that the product in question is for use in motor vehicles, the tariff classification of carpeting for automobiles should be applied to the product if the client (a subcontractor of an automobile maker) presents a "purpose-of-use certificate" or other relevant documents at the time of customs clearance.
(Second complaint)
Considering that the distinction between carpeting for automobiles and carpeting for general indoor use is clear from the use and materials of the carpeting, it is unfair to impose duty on the product in question.
In order to fundamentally solve the problem, we want the ministry to apply the HS number for "carpeting for automobiles" to the product in question.
4. Corresponding Policy of the Ministries concerned:
(1) In accordance with Article 4 of the Customs Law, the tariff classification for imported goods is determined not by the final use of the product but by its state when the import declaration is made.
(2) Regarding application of tariff classification 5703.20, 5703.30, and 5704.90, of carpeting for automobiles "of size and shape suitable for incorporation in motor vehicles," which is subject to no duty under the provisions of the Customs Tariff Law, it is not sufficient for the goods to be for use in automobiles, the actual product must be judged to be of suitable size and shape at the time of the import declaration.
(3) Accordingly, since the product in question is in rolled form, and not cut or sized in any way, at the time of the import declaration, the tariff classification 5703.20, 5703.30, and 5704.90, of carpeting for automobiles "of size and shape suitable for incorporation in motor vehicles" (subject to no duty) does not apply.
(Second corresponding policy)
(1) In accordance with Article 4 of the Customs Tariff Law, the tariff classification for imported goods is determined not by the final use of the product but by its state when the import declaration is made.
(2) Regarding application of tariff classification 5703.20, 5703.30, and 5704.90, of carpeting for automobiles "of size and shape suitable for incorporation in motor vehicles," which is subject to duty under the provisions of the Customs Tariff Law, the actual product must be judged to be of suitable size and shape at the time of the import declaration.
(3) Since the product in question is in rolled form, and not cut or sized in any way, we cannot accept the complainant's claim that the product can clearly be judged as carpeting for automobiles from its use and materials. The product cannot be classified as "of size and shape suitable for incorporation in motor vehicles."
(Reference)
< Article 4 of the Customs Law >
The nature and quantity of freight on which customs duty is based is determined by its state when the import declaration for the freight in question is made.
< Attached table of the Customs Tariff Law: Customs tariff table regulations >
57.03 Carpets or other textile floor coverings (tufted covering regardless of whether it is a product or not)
5703.20 Those made of nylon or other polyamides: Applicable rate
5703.20-1 Of size and shape suitable for incorporation in motor vehicles: No duty
5703.20-2 Other articles: 7%
5703.30 Those made of other synthetic fibers
5703.30-1 Of size and shape suitable for incorporation in motor vehicles: No duty
5703.30-2 Other articles: 7%
57.04 Carpets or other textile floor coverings (limited to felt covering regardless of whether it is a product or not, but not tufted or flocked)
5704.90 Other articles
5704.90-1 Of size and shape suitable for incorporation in motor vehicles: No duty
5704.90-2 Other articles: 8.2%
5. Remarks
The complainant is now examining the matter.