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HQ 086375


May 23, 1990

CLA-2:CO:R:C:G 086375 SR

CATEGORY: CLASSIFICATION

TARIFF NO.: 7103.10.4000; 7116.20.2000

Mr. Eric C. Braunwart
American Gem Trade Association
181 World Trade Center
2050 Stemmons Expressway
Dallas, TX 75207

RE: Gem stones

Dear Mr. Braunwart:

This is in reference to your letter dated January 19, 1990, requesting the tariff classification of certain gemstones under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). The gemstones will be imported from various countries.

FACTS:

The merchandise at issue consists of two form of gemstones. One is semiprecious stone bead necklaces that are imported temporarily strung. The other is "rough" precious and semiprecious stones that have been trimmed or rough-sawn, but not cut, faceted, polished and not suitable for use in the manufacture of jewelry without further fabrication.

ISSUE:

ISSUE 1

What is the classification of semiprecious stone bead necklaces that are imported temporarily strung?

ISSUE 2

What is the classification of rough precious and
semiprecious stones that have been trimmed or rough-sawn, but not cut, faceted, polished and not suitable for use in the manufacture of jewelry without further fabrication?

LAW AND ANALYSIS:

ISSUE 1

Under the Tariff Schedules of the United States (TSUS), the rate of duty applicable to semiprecious stone beads was 2.1 percent ad valorem, whether they were imported loose or temporarily strung and whether the stones were graded or ungraded. The HTSUSA became effective on January 1, 1989. Under heading 7103, HTSUSA, loose semiprecious stones and ungraded semiprecious stone bead necklaces temporarily strung for convenience of transport remain dutiable at the rate of 2.1 percent ad valorem. However, the temporarily-strung semiprecious stone bead necklaces with which you are concerned, are strands of graded semiprecious stone beads. These graded beads are not provided for under heading 7103, HTSUSA.

The Explanatory Notes provide the official interpretation of the tariff at the international level. The Explanatory Notes to heading 7103, HTSUSA, state that the stones of this heading may be strung for the convenience of transport, provided this method of assembly is temporary and the stones have not been graded and are not directly suitable for use as jewelry. In Headquarters Ruling Letter (HRL) 086104, dated December, 14, 1989, graded semiprecious stone necklaces, temporarily strung, were classified under subheading 7116.20.2000, HTSUSA, and dutiable at the rate of 21 percent ad valorem. The issue concerning the tariff classification of graded semiprecious stones that are strung temporarily for the convenience of transport, is currently pending before Congress. Articles of semiprecious stones are covered by Item 202, Section 10517 of H.R. 3150.

ISSUE 2

The other merchandise at issue consists of "rough" (uncut) precious and semiprecious gemstones that have been trimmed or rough-sawn, but not cut, faceted or polished and not suitable for use in jewelry without further fashioning. Under the TSUS, "rough" and semiprecious gemstones that were imported in
rough-sawn or roughly shaped condition were free of duty. Under the HTSUSA, "rough" precious and semiprecious stones that are unworked remain free of duty under subheading 7103.10.2000, HTSUSA. However, "rough" gemstones that have been trimmed or rough-sawn cannot be classified under this provision. They are classifiable under subheading 7103.10.4000, HTSUSA, which provides for precious and semiprecious stones that are other than unworked. They are dutiable at 21 percent ad valorem.

HOLDING:

ISSUE 1

Semiprecious stone bead necklaces that are imported temporarily strung are classifiable under subheading 7116.20.2000, HTSUSA, which provides for articles of precious or semiprecious stones (natural, synthetic or reconstructed): of precious or semiprecious stones, other, of semiprecious stones. The rate of duty is 21 percent ad valorem under the General Duty Rate column.

ISSUE 2

The merchandise at issue that consists of rough precious and semiprecious stones that have been trimmed or rough-sawn, but not cut, faceted, polished and not suitable for use in the manufacture of jewelry without further fabrication, are classifiable under subheading 7103.10.4000, HTSUSA, which provides for precious and semiprecious stones, that are other than unworked. The rate of duty is 21 percent ad valorem under the General Duty Rate column.

The U.S. Customs Service is an administrative agency, and as such has no authority to make any changes in or grant any waiver of the provisions of the tariff schedule. If you wish to further pursue this issue, you can contact the office of the United States Trade Representative at 600 17th Street, N.W., Washington, D.C. 20506.

Sincerely,

John Durant, Director

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