United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1990 HQ Rulings > HQ 0544283 - HQ 0554945 > HQ 0554920

Previous Ruling Next Ruling


HQ 554920


January 3, 1989

CLA-2 CO:R:C:V 554920 GRV

CATEGORY: CLASSIFICATION

TARIFF NO.: 9802.00.80; 807.00

Mr. R. B. McKenny
C. S. Emery & Company, Inc.
P.O. Box 307
Derby Line, Vermont 05830

RE: Applicability of partial duty exemption under HTSUS subhead- ing 9802.00.80 to certain vertical blinds to be imported from Canada.

Dear Mr. McKenny:

This is in response to your letter of February 11, 1988, on behalf of Frontenac Fabrics, Inc., requesting a ruling on the ap- plicability of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS) (formerly item 807.00, Tariff Sched- ules of the United States (TSUS)), to certain vertical blinds to be imported from Canada. Samples of both the fabric rolls to be exported and the vertical blinds to be imported were submitted for examination.

FACTS:

You state that rolls of fabric of U.S. origin, measuring three and half inches wide by approximately 100 yards, will be exported to Canada for assembly operations consisting of:

(1) cutting the rolled fabric to length;
(2) punching a one-half inch hole near one end of the fabric for receipt of a removable plastic hanger insert;
(3) folding the punched end over and sewing a one inch hem in it to receive the removable plastic hanger insert; and
(4) folding the opposite end over and sewing a two and a half inch hem in it, the resultant pocket either containing an inserted metal weight or not.

The completed articles--vertical blinds--will then be returned to the U.S.

ISSUE:

Whether the foreign operation constitutes an "assembly," thereby entitling the vertical blinds to the partial duty
exemption under HTSUS subheading 9802.00.80 (item 807.00, TSUS) when returned to the U.S.

LAW & ANALYSIS:

As you are probably aware, on January 1, 1989, the Harmo- nized Tariff Schedule of the United States (HTSUS) superseded and replaced the Tariff Schedules of the United States (TSUS). TSUS item 807.00 was carried over into the HTSUS without change as subheading 9802.00.80. This tariff provision provides a partial duty exemption for articles:

... assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly with- out further fabrication, (b) have not lost their physi- cal identity in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assem- bled and except by operations incidental to the assembly process such as cleaning, lubricating, and painting.

Under this tariff provision, there is a duty upon the full value of the imported assembled article less the cost or value of such U.S. components, provided the documentation requirements of sec- tion 10.24, Customs Regulations (19 CFR 10.24), are satisfied.

Of importance to the sample fabric material submitted is the term "assembled." Section 10.16(a), Customs Regulations (19 CFR 10.16(a)), provides that:

The assembly operations performed abroad may consist of any method used to join or fit together solid com- ponents, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners....

Court decisions construing the term "assembly" have uni- formly held that the term "assembly," for purposes of TSUS item 807.00, involves the joining or coming together of solids. See, for example, United States v. Baylis Brothers Co., 59 CCPA 9, C.A.D. 1026, 451 F.2d 643 (1971). Implicit in this construction of the term "assembly" is that multiple solid components are joined together in a manner that permanently fixes their respective positions.

One of the problems presented in the instant case is that the process of sewing a one-inch hem to the end of the cut fabric containing the punched hole results in merely joining the fabric to itself. We have previously ruled that the joining of fabric to itself rather than to another component is not an acceptable
assembly operation or an operation incidental to assembly for purposes of TSUS item 807.00. See Headquarters Ruling Letter 554959 (August 29, 1988). Punching the one-half inch hole in the fabric also clearly is not an operation which is incidental to assembly under the circumstances of this case. The operations of punching the hole in the fabric and sewing the one-inch hem advance the value and improve the condition of the fabric by means other than assembly and demonstrate that the fabric was not in condition ready for assembly with other components at the time of exportation. As a result, no allowance in duty may be made for the value of the fabric under HTSUS subheading 9802.00.80 upon importation of the vertical blinds.

Moreover, because the plastic hanger to be inserted into the end of the fabric with the one-inch hem is not permanently fixed by an assembly process, but is removable, no allowance may be made for the value of the plastic hanger under this tariff provision. However, the process of enclosing a metal weight in the two and a half inch hem on the other end of the fabric strip constitutes an acceptable assembly operation since the weight will be permanently joined to the fabric by the sewing operation. Therefore, with respect to those vertical blinds which will have metal weights inserted therein, allowances in duty may be made for the value of the weights under HTSUS subheading 9802.00.80, provided the weights are of U.S. origin.

CONCLUSION:

On the basis of the information and samples submitted, no exemption from duty may be given under HTSUS subheading 9802.00.80 for the value of the U.S. fabric to be exported or for the value of the plastic hangers. However, in regard to those vertical blinds to be imported containing metal weights, allowances in duty may be made under this tariff provision for the cost or value of the weights if they are of U.S. origin and the documentation requirements set forth in 19 CFR 10.24 are satisfied.

Sincerely,


Previous Ruling Next Ruling

See also: