AMENDMENTS TO HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES.

SEC. 1433. AMENDMENTS TO HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES. (a) Heading.—Subchapter XVII of Chapter 98 is amended by inserting in numerical sequence the following new heading: “ 9817 85.01 Prototypes to be used exclusively for development, testing, product evaluation, or quality control purposes Free The rate applicable in the absence of this heading ”. (b) U.S. Note.—The U.S. Notes to subchapter XVII of chapter 98 are amended by adding at the end the following: “6. The following provisions apply to heading 9817.85.01: “(a) For purposes of this subchapter, including heading 9817.85.01, the term ‘prototypes’ means originals or models of articles that— “(i) are either in the preproduction, production, or postproduction stage and are to be used exclusively for development, testing, product evaluation, or quality control purposes; and “(ii) in the case of originals or models of articles that are either in the production or postproduction stage, are associated with a design change from current production (including a refinement, advancement, improvement, development, or quality control in either the product itself or the means for producing the product). For purposes of clause (i), automobile racing for purse, prize, or commercial competition shall not be considered to be “development, testing, product evaluation, or quality control.”. “(b)(i) Prototypes may be imported only in limited noncommercial quantities in accordance with industry practice. “(ii) Except as provided for by the Secretary of the Treasury, prototypes or parts of prototypes may not be sold after importation into the United States or be incorporated into other products that are sold. “(c) Articles subject to quantitative restrictions, antidumping orders, or countervailing duty orders may not be classified as prototypes under this note. Articles subject to licensing requirements, or which must comply with laws, rules, or regulations administered by agencies other than the United States Customs Service before being imported, may be classified as prototypes if they comply with all applicable provisions of law and otherwise meet the definition of ‘prototypes’ under paragraph (a).”.