There are two textile product components in the kit, a textile bag pack (classified at 4202.92 Harmonized Tariff Schedule of the United States, with rate of duty of 17.60%) and chest mount harness (classified at 6307.90 HTSUS, with rate of duty of 7.00%) ModusLink will lock in Privileged Foreign Status for textile items, meaning that for those textile items the full duty will be paid and the only benefit, as relating to the textile inputs, will be a deferral in the payment of the duty, which will be paid when the finished kits are shipped, rather than when the components were imported.
Wednesday, September 24, 2014
FTZ Approved for Camera and Accessories Kitting
On May 21, 2014, the March Joint Powers Authority, grantee of Foreign Trade Zone ("FTZ") 244, submitted a notification of proposed production activity to the FTZ Board on behalf of ModusLink Global Solutions, within Site 5, in Riverside, California. ModusLink performs assembly, kitting, programming, testing, packaging, final stage processing, warehousing and distribution of GoPro cameras and accessory kits in combination with other related items including but not limited to accessories, gift items and batteries. ModusLink sought production authority for combining imported components and parts into a retail package that will result in a tariff shift for those components. The kitting will cause a tariff shift as the package will be classified according to the essential character, the camera. This will result in the kit falling under a new HTS subheading of the finished product. The result would be a single finished product with a lower duty rate than the rate on the foreign components.