Inseto (UK) Ltd v Revenue and Customs (CUSTOMS DUTY : Classification - nomenclature)

CUSTOMS DUTIES � specialised aluminium wire used in manufacture of semiconductors, printed circuits� and similar devices � whether within CN heading 7605 (aluminium wire) or 8541 (diodes, transistors etc) � appeal against BTI in heading 7605 � whether BTI correct � yes � appeal dismissed

Mr Ben Lloyd, counsel, instructed by the General Counsel and Solicitor to HM Revenue and Customs, for the respondents

The question I must determine is whether the wire should be classified in heading 7605 or heading 8541 of the Combined Nomenclature (�the CN�). HMRC say the former, and have issued a binding tariff information (�BTI�) in that heading. Inseto argues that the correct heading is 8541, and it has accordingly appealed against the BTI, which was upheld on the customary review. The underlying reason for the appeal is that goods of heading 7506 attract customs duty at 7.5% while goods of heading 8451 are free of duty. The parties are agreed that no other heading of the CN might be relevant.

That interpretation was, he said, consistent with the Notes to Chapter 85 which, at 8(b), described �electronic integrated circuits� as, among other things:

�Hybrid integrated circuits in which passive elements (resistors, capacitors, inductances, etc) obtained by thin- or thick-film technology, and active elements (diodes, transistors, monolithic integrated circuits, etc), obtained by semiconductor technology, are combined to all intents and purposes indivisibly, by interconnections or interconnecting cables, on a single insulating substrate (glass, ceramic, etc).�