CAFC Affirms CIT's Separate Classifications of Electric and Optical Fiber Cables
CAFC rules that cables imported separately are not classifiable as unassembled pieces. In ABB, Inc. v. U.S., the Court of Appeals for the Federal Circuit (CAFC) affirmed a Court of International Trade (CIT) ruling that two high voltage electric cables should be classified under HTS 8544.60.4000 (3.5%) as other electric conductors for a voltage exceeding 1,000 volts, of copper. The CAFC also affirmed the CIT's decision that a fiber optic cable should be classified under HTS 8544.70.0000 (duty-free), as an optical fiber cable.
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According to the CAFC, ABB imported the fiber optic cable and the pair of high-voltage electric cables to be buried in the sea floor of the Long Island Sound. After importation, but prior to being deposited in an underwater trench, the three cables were manually bundled together with steel straps on a cable-laying boat. Due to their size, it was not feasible to enclose all three cables within a common sheath at the time of manufacture.
Among other things, ABB argues that because the three cables were bundled together after importation, they were imported as the unassembled pieces of a single "optical fiber cableassembled with electric conductors" and thus should be classified under HTS 8544.70.0000.
However, the CAFC finds that the mere bundling of certain articles after importation does not necessarily amount to an "assembly" of another article alleged to have been imported in an "unassembled" condition. The CAFC adds that the three cables each possess the characteristics of a distinct and separate commercial entity as each is a finished article that is capable of functioning independently of the other two cables, such that each cable could have been laid in separate trips across the Long Island Sound without loss of function. The CAFC concludes that because each cable is not a "part," there is no principled basis for classifying the three cables as a single "assembled" article merely because, after importation, they are bundled together for logistical convenience. Therefore, the CAFC concurs with Customs' individualized classification of each cable in the bundle.
(See ITT's Online Archives or 09/27/04 news, 04092745, for BP summary of the CIT's decision to classify these cables separately.) (Court No. 05-1003, decided 08/16/05, available at http://www.fedcir.gov/opinions/05-1003.pdf)