On May 18, 2016 the Commercial Court of Moscow rendered a
decision on the customs dispute of Apple Rus LLC (the
"Company") over the classification of Apple Watch devices
according to the unified Foreign Economic Activity Commodity
Nomenclature of the Eurasian Economic Union (FEACN of the EAEU)
(case No. А40-32818/16).
Based on the court decision, further to the Company's
application the customs authority made advance rulings to classify
personal wireless receiving and transmitting wearable Apple Watch
devices under the following FEACN of the EAEU codes:
9102 12 000 0 – "electrically operated wristwatches
with or without a built-in stopwatch, with optical-electronic
display only," import customs duty rate 10%;
9102 19 000 0 – "electrically operated wristwatches
with or without a built-in stopwatch, other," import customs
duty rate – 7%.
For its part, the Company stated that Apple Watches should be
classified under commodity heading 8517 (subheading 8517 62) as
"machines for the reception, conversion and transmission or
restoration of voice, images or other data, including switching
devices and routers" under the General Rules of Interpretation
of the FEACN of the EAEU 3b because the wireless data sharing
module is a component part that is a key feature of the product.
The import customs duty rate is 0%.
The court considered the customs authority's position to be
more substantiated based on the following:
The Apple Watch, as a wireless device, is capable of performing
different functions that are independent of one another; at the
same time, it does not seem possible to identify a single key and
significant function determining the purpose; thus, it is not
possible to apply General Rules of Interpretation of the FEACN of
the EAEU 3b in classification.
The Apple Watch should be classified in accordance with the
next General Rules of Interpretation of the FEACN of the EAEU 3c,
according to which it is necessary to determine codes for each
equivalent function performed and choose the code that is the last
in ascending order.
A further argument that the Apple Watch is correctly classified
as a watch (chasy), in the court's opinion, is the well-known
fact that the device is worn on the wrist, is a band, shows the
time, and the name Watch translated from the English means
The court considered the fact that the customs authorities
classify the Apple Watch under commodity heading 8517 in many
countries (the United States, Canada, Japan, Turkey, Ireland, etc.)
irrelevant to the subject matter of the dispute.
The court's decision on this case shows once again that the
issue of classifying goods continues to be one of the most
controversial issues in customs relations.
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