<html><head><base href="x-msg://5731/"></head><body style="word-wrap: break-word; -webkit-nbsp-mode: space; -webkit-line-break: after-white-space; ">Hi Kelley,<div><br></div><div>It's actually worse than that both in terms of risk and also aggravation.</div><div><br></div><div>In the application you fill out when appealing for duty-free status on those imported tools and instruments, the form you fill out is called:</div><div>ADDITIONAL ANSWERS: INSTRUMENTS AND APPARATUS FOR EDUCATIONAL AND SCIENTIFIC INSTITUTIONS, 15 CFR, Part 301 </div><div><br></div><div>And this form includes a statement to be signed by the purchaser (you) and subject to audit with specified penalties of "fines and imprisonment"</div><div>
<p><span style="font-size: 12.000000pt; font-family: 'TimesNewRomanPSMT'">7.c "I hearby certify that there will not be any use of the foreign instrument by or for
the primary benefit of any Commercial (for-profit) entity within 5 years after
entry of the foreign instrument into the United States customs territory.”</span></p><p><span class="Apple-style-span" style="background-color: transparent;">Note that the language prohibits "any use" "for the primary benefit" of a for-profit entity, as opposed to describing "primary use" by academic or commercial entities. If the latter, we would have some leeway. But given the language, it leaves us with two legal options:</span></p><div>1) pay the customs fees. </div><div><br></div><div>-or-</div><div><br></div><div>2) ask companies to set up a formal sponsored project through OSP, wherein one or more students are trained to operate the tool. Then you can describe how the primary benefit is educational, to the student. </div><div><br></div><div>The more common approach is to plead ignorance altogether or pretend to not know about it and hope that customs officials are too busy or too distracted or just unwilling to enforce this ridiculous regulation.</div><div><br></div><div>I've gone the rounds with general counsel, import attorneys, state economic development officials, chambers of commerce, even the customs officials themselves. I have found no rational way around this from a legal standpoint.</div><div><br></div><div>Good luck to you,</div><div><br></div><div>—Ian</div><div><br></div><div>Utah Nanofab</div><div>801/585-6162</div><div><br></div><div><div>On Aug 28, 2014, at 8:11 AM, Bradley, Kelley wrote:</div><br class="Apple-interchange-newline"><div lang="EN-US" link="blue" vlink="purple"><div class="WordSection1" style="page: WordSection1; "><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Greeting all,<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">CFR 15 B III A 301 was just brought to my attention by colleague at another university. The regulations appear to state that if a US university has equipment shipped duty free from a foreign seller the equipment cannot be used by industrial users. This has not come up for us yet at the University of Houston but I’m wondering how others handle it. Does anyone else have experience with this regulation and if so, how does your university interpret it?<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Here is a link to the regulations: <span class="Apple-converted-space"> </span><a href="http://www.ecfr.gov/cgi-bin/text-idx?SID=38f3e0f5486864d73636db4f13866f4d&node=pt15.2.301&rgn=div5" style="color: blue; text-decoration: underline; ">http://www.ecfr.gov/cgi-bin/text-idx?SID=38f3e0f5486864d73636db4f13866f4d&node=pt15.2.301&rgn=div5</a><o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Specifically we are looking at 301.1 c: <o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i>Summary of statutory procedures and requirements. (1) U.S. Note 1, Subchapter X, Chapter 98, HTSUS, provides, among other things, that articles covered by subheadings 9810.00.60 (scientific instruments and apparatus), 9810.00.65 (repair components therefor) and 9810.00.67 (tools for maintaining and testing the above), HTSUS, must be exclusively for the use of the institutions involved and not for distribution, sale, or other commercial use within five years after entry. These articles may be transferred to another qualified nonprofit institution, but any commercial use within five years of entry shall result in the assessment of applicable duties pursuant to §301.9(c).<o:p></o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">And 301.4 a 3:<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i>Review and determination. The Commissioner shall date each application when received by Customs and Border Protection. If the application appears to be complete, the Commissioner shall determine:<o:p></o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i><o:p> </o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i>Whether the instrument or apparatus is for the exclusive use of the applicant institution and is not intended to be used for commercial purposes. For the purposes of this section, commercial uses would include, but not necessarily be limited to: Distribution, lease or sale of the instrument by the applicant institution; any use by, or for the primary benefit of, a commercial entity; or use of the instrument for demonstration purposes in return for a fee, price discount or other valuable consideration. Evaluation, modification or testing of the foreign instrument, beyond normal, routine acceptance testing and calibration, to enhance or expand its capabilities primarily to benefit the manufacturer in return for a discount or other valuable consideration, may be considered a commercial benefit. In making the above determination, the Commissioner may consider, among other things, whether the results of any research to be performed with the instrument will be fully and timely made available to the public. For the purposes of this section, use of an instrument for the treatment of patients is considered noncommercial.<o:p></o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i><o:p> </o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><i>If any of the Commissioner's determinations is in the negative, the application shall be found to be outside the scope of the Act and shall be returned to the applicant with a statement of the reason(s) for such findings.<o:p></o:p></i></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Thanks<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">-Kelley<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><o:p> </o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">---------------------------------------------<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Robert Kelley Bradley, Ph.D.<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Nanofabrication Facility Manager<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">University of Houston<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">3605 Cullen Blvd, Entrance 14<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Room 1011, SERC Bldg 545<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Houston, TX 77204-5062<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Postal Address: <o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "> 3605 Cullen Blvd, Rm 2027<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "> Houston, TX 77204-5062<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Phone: 832-842-8822<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">FAX: 713-743-0428<o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Email: <span class="Apple-converted-space"> </span><a href="mailto:rkbradley@uh.edu" style="color: blue; text-decoration: underline; ">rkbradley@uh.edu</a><o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; ">Web: <span class="Apple-converted-space"> </span><a href="http://www.uh.edu/nanofab" style="color: blue; text-decoration: underline; ">www.uh.edu/nanofab</a><o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; font-family: Calibri, sans-serif; "><a href="http://www.facebook.com/UH.Nanofab" style="color: blue; text-decoration: underline; ">www.facebook.com/UH.Nanofab</a><o:p></o:p></div><div style="margin-top: 0in; margin-right: 0in; margin-left: 0in; margin-bottom: 0.0001pt; font-size: 11pt; 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