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Cablegate: Taiwan Mulling Over Thermistor Classification

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS TAIPEI 003728

SIPDIS

E.O. 12958: N/A
TAGS: ECON ETRD EIND
SUBJECT: TAIWAN MULLING OVER THERMISTOR CLASSIFICATION

REF: SECSTATE 243653

1. Summary: AIT Econ Chief delivered reftel demarche to
Ministry of Economic Affairs Vice Minister Steve Chen on
November 17, 2004. Chen was familiar with the case and said
that Taiwan has about a month before it would need to submit
a report to the World Customs Organization. Apparently,
Taiwan has yet to make a final determination on the proper
classification of the Tyco thermistors. End Summary.

2. On November 17, 2004, AIT Econ Chief used a previously
scheduled meeting with Ministry of Economic Affairs Vice
Minister Chen Ruey-long (Steve Chen) to deliver reftel
demarche regarding Tyco's appeal of Taiwan Customs'
classification of its electronic thermistor devices. Even
though we had not been able to give Chen advance notice of
this topic, he was clearly familiar with the issues involved.


3. Citing the relevant Harmonized System tariff numbers from
memory, he noted that the World Customs Organization had
recommended that the devices be classified as resistors, but
added that the WCO has some divergent views on this issue.
As he explained it, the WCO recommends classifying the
devices under HS 8533, but also believes that a case can be
made for classifying them under HS 8536.

4. Chen said that he had chaired a recent meeting with the
Ministry of Finance and Customs about Tyco's appeal of
Customs' classification of the devices. Clearly aware of
Taiwan's obligations to respond to WCO rulings, Chen said
that he has asked Taiwan Customs to review the case. If
Customs continues to believe that the devices should be
classified as fuses rather than resistors, then he has
requested Customs to prepare a report for the WCO explaining
this decision. Chen said that Taiwan has a two month period
in which to provide comments to WCO and has about one month
left before the report is due. We expect that Taiwan will
use the full two months to mull over this classification
decision.

5. Finally, Chen noted that the issue is complicated by the
fact that a Taiwan company has filed a case against Taiwan
Customs over classification of the devices. He also noted
that a fine of some type has been levied against Tyco and
that Tyco believes the fine is unjustified.
PAAL

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