A car manufacturer is importing parts from its overseas subsidiary for testing in its new electric vehicle model that is in pre-production. The parts are being tested to determine whether changes need to be made before the vehicle goes to market. Under which of the following scenarios would these parts be eligible to receive duty-free treatment under subheading 9817.85.01? (2025 October No.74 – Valuation, Appraisement and Duty Assessment)
A) After the manufacturer uses the parts, the parts will be sold at a discounted rate to a local school for use in its shop classes.
B) The company is using the parts in quality control tests for the vehicle.
C) The manufacturer is importing 10 times more parts than other manufacturers have used in the development of similar electric vehicles.
D) To avoid waste, the best-functioning imported parts will be incorporated into vehicles that will be sold to the public.
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The Answer is: B
Citation: 9817.85.01, HTSUS
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