Application for Advance Ruling for Surgical Implants>>Tax Consultant

Janron Consult - Customs Tax News - Clients Work 2022-Case Studies - Application for Advance Ruling for Surgical Implants>>Tax Consultant

28th July,2023

 

The Chief Manager, Business Intelligence & Analysis

Kenya Revenue Authority

Times Towers

Nairobi, Kenya

 

Dear Madam,

 

REF: Application for Advance Ruling for Surgical Implants

We are writing to request for a HS classification, advance ruling,  for two types of Surgical implants namely:

The structure of the application consists of:

Similar products were canvassed in October 2022, and this resulted in the update of the description of subheading 9021.90 in the Simba/ICMS system as well as classification of similar products under subheading 9021.10.00

Description of Products

A burr-hole cover was created to cover small cranial defects and craniostomies. Using high-density polyethylene, this cover was designed to resemble the bony structure of the skull. Its porous architecture allows for tissue ingrowth and bony integration. It consists of a cylinder which fits into the burr hole and a cap which can be sutured or anchored with titanium screws.

Burr Hole Cover is intended for use following cranial surgery to cover a burr hole.

What are burr holes?

Burr holes are small holes that a neurosurgeon makes in the skull. Burr holes are used to help relieve pressure on the brain when fluid, such as blood, builds up and starts to compress brain tissue.

A layer of thin tissues called meninges surround and help protect the brain. These meninges contain blood vessels that carry blood to and from the brain. The dura is the outermost of these meninges.

A head injury can cause one or more of these blood vessels to tear and bleed. A sudden tear might cause blood to build up very suddenly. With a small tear, the blood might build up more slowly. Blood might start to build up just below the dura mater. This causes something called a subdural hematoma. Tears in different blood vessels may cause blood to build up just above the dura layer, causing an epidural hematoma. A hematoma is when blood collects in an area and causes swelling.

 

This buildup of blood is dangerous. As the blood builds, it pushes up against the skull and has nowhere to go. If the blood starts to compress the brain, it can lead to symptoms or even death if not treated.

Why might I need burr holes?

One of the most common reasons burr holes are needed is for a subdural hematoma. This is when blood slowly builds up under the dura layer after a mild head injury. The veins here are fragile and easy to break, especially in older adults. This can lead to symptoms like headache, changes in behaviour, seizures, and one-sided muscle weakness. If the blood continues to build, it may cause coma and brain damage.

There are other reasons why you might need a burr hole procedure. Neurosurgeons may perform a burr hole procedure to relieve pressure around the brain due to:

In cases of large hematomas or solid clots, your healthcare provider may advise another procedure to remove the material around the brain. For example, a surgeon may remove a larger piece of bone from the skull to treat the brain, and then put the piece of skull back in place to heal. This is called a craniotomy. This is called a craniectomy.

These types of surgery may have a higher rate of complications than a burr hole procedure. They may be needed if you have chronic subdural hematomas.

Aneurysm Clips

A surgical procedure to treat brain aneurysms involves opening the skull, finding the affected artery, and then placing a metal clip over the neck of the aneurysm.

Brain aneurysm clipping is a type of microsurgery in which a metal surgical clip is used to close off an aneurysm in the brain. The surgeon makes a small opening in your skull to reach your brain.

Brain aneurysm clipping is a complex procedure used by cerebrovascular surgeons to treat ruptured and unruptured brain aneurysms.

 

What Is Aneurysm Clipping?

Brain aneurysm clipping is a type of microsurgery in which a metal surgical clip is used to close off an aneurysm in the brain. The surgeon makes a small opening in your skull to reach your brain. They use an operating microscope and very small instruments to perform detailed surgical procedures. Precision is key during microsurgery to avoid harming nerves, blood vessels and brain tissue.

In aneurysm clipping surgery, the surgeon:

 

Understanding Cerebral Aneurysms and Their Impact on the Brain

A brain aneurysm, also called a cerebral aneurysm, is a weak spot in the wall of an artery that balloons out. Most aneurysms in the brain look like a round sac off the side of the artery. The neck of the aneurysm between the artery and sac can be narrow or wide and is the typical target of an aneurysm clip.

The greatest risk of a brain aneurysm is that it will rupture and cause a life-threatening haemorrhagic stroke. About half of people who experience a stroke due to a ruptured aneurysm die within three months. Aneurysm clipping procedures close off the cerebral aneurysm to prevent blood from entering the spaces around the brain that may lead to a stroke.

 

Summary of the functions of the 2 Products

They are used for internal fixation in orthopaedic surgery to support healing.

 

Difference between other artificial body parts and the instant products

Orthopaedic implants are those materials that are used for hard tissue applications to replace bones and joints.  Orthopaedic implants are categorized into two groups including permanent joint replacements and temporary fracture fixation devices. Permanent orthopaedic implants include the hip, knee, ankle, shoulder, elbow, wrist, and finger joints, which are expected to serve in the human body throughout the life span of the patients. The permanent body parts are classifiable under subheading 9021.3. Fracture fixation devices are to be classified under subheading 9021.10.00

The Burr hole covers, and aneurysm clips are for temporary support of the above-mentioned organs to fast-track healing of the organ.  They do not replace the organ.

 

Analysis of Relevant Explanatory Notes

Chapter 90 Explanatory Notes

1.‑  This Chapter does not cover :

(f)    Parts of general use, as defined in Note 2 to Section XV, of base metal (Section XV) or similar goods of plastics (Chapter 39);however, articles specially designed for use exclusively in implants in medical, surgical, dental or veterinary sciences are to be classified in heading 90.21.

 

2.‑  Subject to Note 1 above, parts and accessories for machines, apparatus, instruments or articles of this Chapter are to be classified according to the following rules :

(b)    Other parts and accessories, if suitable for use solely or principally with a particular kind of machine, instrument or apparatus, or with a number of machines, instruments or apparatus of the same heading (including a machine, instrument or apparatus of heading 90.10, 90.13 or 90.31) are to be classified with the machines, instruments or apparatus of that kind;

(III) PARTS AND ACCESSORIES

Subject to Chapter Note 1, parts or accessories identifiable as suitable for use solely or principally with the machines, appliances, instruments or apparatus of this Chapter are classified with those machines, appliances, etc.

The extracts of the notes above instruct us to classify parts of general use under heading 90.21 if they are exclusively used in medical, surgical, dental, or veterinary sciences.  Therefore, that note allows the classification of the instant products under heading 90.21.

Parts and accessories of products of chapter 90 are to be classified with the corresponding machines, apparatus, instruments, or articles.

 

Analysis of Relevant Explanatory Notes

Chapter 90 Explanatory Notes

Chapter 90 Note 6.‑  For the purposes of heading 90.21, the expression “orthopaedic appliances” means appliances for :

–     Preventing or correcting bodily deformities; or

–     Supporting or holding parts of the body following an illness, operation, or injury.

Orthopaedic appliances include footwear and special insoles designed to correct orthopaedic conditions, provided that they are either (1) made to measure or (2) mass-produced, presented singly and not in pairs, and designed to fit either foot equally.

Chapter 90 Note 6, defines the precise meaning of Orthopaedic Appliances as per the Terms of Heading 90.21 and Terms of Subheading 9021.10.00.  This note is very important in the consideration of the type of the goods classifiable under subheading  9021.10.00.  The definition describes the functions of the burr hole covers and aneurysm clips.  This note supports the descriptions of the burr hole covers, aneurysm clips done above, that is prevention, correction, support, holding but not replacement which would change the proposed classification.

Analysis of Relevant Explanatory Notes

Heading 9021 Explanatory Notes

90.21 ‑ Orthopaedic appliances, including crutches, surgical belts and trusses; splints and other fracture appliances; artificial parts of the body; hearing aids and other appliances which are worn or carried, or implanted in the body, to compensate for a defect or disability.

9021.10 – Orthopaedic or fracture appliances

9021.21 – – Artificial teeth

9021.29 – – Other

9021.31 – – Artificial joints

9021.39 – – Other

9021.40 ‑ Hearing aids, excluding parts and accessories

9021.50 ‑ Pacemakers for stimulating heart muscles, excluding parts and accessories

9021.90 ‑ Other

 

(I) ORTHOPAEDIC APPLIANCES

Orthopaedic appliances are defined in Note 6 to this Chapter.  These are appliances for :

–    Preventing or correcting bodily deformities; or

–    Supporting or holding parts of the body following an illness, operation or injury.

They include :

(1)   Appliances for hip diseases (coxalgia, etc.).

(2)   Humerus splints (to enable use of an arm after resection), (extension splints).

(3)   Appliances for the jaw.

(4)   Traction, etc., appliances for the fingers.

(5)    Appliances for treating Pott’s disease (straightening head and spine).

(6)  Orthopaedic footwear and special insoles designed to correct orthopaedic conditions, provided that they are either (1) made to measure or (2) mass-produced, presented singly and not in pairs and designed to fit either foot equally.

(7)   Dental appliances for correcting deformities of the teeth (braces, rings, etc.).

(8)  Orthopaedic foot appliances (talipes appliances, leg braces, with or without spring support for the foot, surgical boots, etc.).

(9)    Trusses (inguinal, crural, umbilical, etc., trusses) and rupture appliances.

(10)  Appliances for correcting scoliosis and curvature of the spine as well as all medical or surgical corsets and belts (including certain supporting belts) characterised by :

(a)      Special pads, springs, etc., adjustable to fit the patient.

(b)      The materials of which they are made (leather, metal, plastics, etc.); or

(c)      The presence of reinforced parts, rigid pieces of fabric or bands of various widths.

The special design of these articles for a particular orthopaedic purpose distinguishes them from ordinary corsets and belts, whether or not the latter also serve to support or hold.

(11)  Orthopaedic suspenders (other than simple suspenders of knitted, netted, or crocheted materials, etc.).

This group also includes crutches and crutch‑sticks. (It should, however, be noted that ordinary walking‑sticks, even if specially made for disabled persons, are excluded (heading 66.02).)

This group further includes walking aids known as “walker-rollators”, which provide support for the users as they push them.  They generally consist of a tubular metal frame on three or four wheels (some or all of which may swivel), handles and handbrakes.  “Walker-rollators” can be adjustable in height and can be equipped with a seat between the handles and with a wire basket for carrying personal items.  The seat allows the user to take short rest breaks whenever necessary.

The heading does not include :

(a)   Stockings for varicose veins (heading 61.15).

(b)   Simple protectors or devices designed to reduce pressure on certain parts of the foot, (heading 39.26, if made of plastics, or heading 40.14, if of cellular rubber fixed on gauze with adhesive plaster).

(c)   Supporting belts or other support articles of the kind referred to in Note 1 (b) to this Chapter, e.g., pre‑natal or maternity belts (generally heading 62.12 or 63.07).

(d)   Mass‑produced footwear the inner soles of which have been simply arched to alleviate flat‑footedness (Chapter 64).

This group also covers orthopaedic appliances for animals, for example, hernia trusses or straps; leg or foot fixation apparatus; special straps and tubes to prevent animals from crib‑biting, etc.; prolapsus bands (to retain an organ, rectum, uterus, etc.); horn supports, etc. But it excludes protective devices having the character of articles of ordinary saddlery and harness for animals (e.g., shin pads for horses) (heading 42.01).

 

(II) SPLINTS AND OTHER FRACTURE APPLIANCES

Fracture appliances are used either to immobilise injured parts of the body (for extension or protection), or for setting fractures.  They are also used in the treatment of dislocations and other joint injuries.

 

Some of these articles are designed for fitting onto the patient (e.g., wire, zinc or wooden cradles for holding limbs, plaster bandage splints, fracture appliances for ribs, etc.); others are designed to be fixed to a bed, a table or another support (protective bed cradles, extension fracture apparatus made of tubing, to be used in the place of splints or cradles, etc.).  However, when the latter appliances form an inseparable part of the bed, table or another support, they are excluded from this heading.

 

Subject to the provisions of Note 1 (f) to this Chapter, the heading also includes plates, nails, etc., which are inserted inside the human body by surgeons to hold together the two parts of a broken bone or for similar treatment of fractures.

 

Analysis of Heading 9021

These are appliances for :

–    Preventing or correcting bodily deformities; or

–    Supporting or holding parts of the body following an illness, operation, or injury.

Comparison of the definition with the functions of our products fits them precisely under this definition, therefore they will be classifiable under subheading 9021.10.

Fracture appliances are used either to immobilise injured parts of the body (for extension or protection), or for setting fractures.  They are also used in the treatment of dislocations and other joint injuries.

Comparison of the definition with the functions of our products fits them precisely under this definition, therefore they will be classifiable under subheading 9021.10.

 

Subject to the provisions of Note 1 (f) to this Chapter, the heading also includes plates, nails, etc., which are inserted inside the human body by surgeons to hold together the two parts of a broken bone or for similar treatment of fractures.

WCO Rulings on Subheading 9021.10

  1. Screw designed for use in the field of trauma surgery, made of extra hard, colour-finished titanium alloy, of a length of approximately 12 mm. It has a wholly threaded shank with a constant outer diameter of 3 mm and a head. The shank has an asymmetrical thread. The head is also threaded, allowing it to lock into a compression plate in fixation systems, with a recessed socket drive. The product corresponds to the ISO/TC 150 standards for implant screws. It is presented in a sterilized packing. The product is marked with a number and thereby traceable throughout production, distribution and use. Application of GIRs 1 and 6. Adoption : 2017

 

  1. Screw designed for use in the field of trauma surgery as a part of a system for posterior stabilization of the spine, made of extra-hard titanium alloy, of a length of 20 to 45 mm. It has a wholly threaded shank with a constant outer diameter of 4 mm and a dual core thread containing a transition zone for the core diameter change. It has also a self-tapping profile and a blunt, threaded tip. The product has a polyaxial (movable) U-shaped, internally threaded head that offers 25° of angulation around its axis allowing its adjustment and a specialized locking cap for fixing a rod (presented separately) in its head. The product corresponds to the ISO/TC 150 standards for implant screws. The product is marked with a number and thereby traceable throughout production, distribution and use. Application of GIRs 1 and 6. Adoption : 2017

 

 

Analysis of the WCO Rulings

Ruling 2 places screws used for medical purposes, and  which are parts of general use as classifiable under subheading 9021.10.00.

The Screws are used in conjunction with compression plates, which also supports our assertion that the plates and similar trauma surgery articles are classifiable under subheading 9021.10.00

Note the use of the term ‘’fixation systems’’. The implication is that articles for trauma surgery as described in Description Note 6 are for corrective, treatment, and do not replace the body parts

 

 

Conclusions

 

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We hereby enclose copies of the following documents for your reference.

 

From our assessment, these products should be classified under subheading 9021.10.00 – Orthopaedic or fracture appliances as per GIR 1 and 6

 

Our Technical experts will be readily available for any clarification required.

 

In light of the above, we kindly request you to guide us on the suitable tariff classification for above-mentioned products.

Thanking you for your valued consideration.

 

Yours faithfully

 

 

Janron Consult