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HQ 556177


December 9, 1991

CLA- 2 CO:R:C:S 556177 DSN

CATEGORY: CLASSIFICATION

TARIFF NO.: 9802.00.80

Mr. Ernesto Bustamante
William F. Joffroy Inc.
P.O. 698
Nogales, Arizona 85628-0698

RE: Textile tarpaulins; assembly; cutting; sewing; L'Eggs; 19 CFR 10.14(a); 19 CFR 10.16(a)(b); 555671

Dear Mr. Bustamante:

This is in response to your letter of August 7, 1991, to the Area Director, New York Seaport, on behalf of M & M Manufacturing, requesting a ruling on the applicability of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS), to textile tarpaulins imported from Mexico. Your request was forwarded to this office for a reply.

FACTS:

According to your submissions, tarpaulins are constructed from woven polyethylene monofilament fabric. Your client intends to send rolls of polyethylene fabric, textile reinforcement straps, nylon thread, grommets and packing materials all of U.S. origin to Mexico for assembly. In Mexico, the fabric and reinforcement straps are cut to length. The tarpaulins are hemmed with the textile strap sewn on for reinforcement. The grommets are attached with the use of a hammer or press machine two feet apart along the hem before the tarpaulins are packed for shipment to the U.S.

ISSUE:

Whether the tarpaulins qualify for the partial duty exemption available under subheading 9802.00.80, HTSUS, when imported into the U.S.

LAW AND ANALYSIS:

Subheading 9802.00.80, HTSUS, provides a partial duty exemption for:

[a]rticles 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 without further fabrication, (b) have not lost their physical 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 assembled and except by operations incidental to the assembly process, such as cleaning, lubricating, and painting.

All three requirements of subheading 9802.00.80, HTSUS, must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to duty upon the full cost or value of the imported assembled article, less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of section 10.24, Customs Regulations 919 CFR 10.24).

Section 10.14(a), Customs Regulations (19 CFR 10.14(a)), states in part that:

(t)he components must be in condition ready for assembly without further fabrication at the time of their exportation from the United States to qualify for the exemption. Components will not lose their entitlement to the exemption by being subjected to operations incidental to the assembly either before, during, or after their assembly with other components.

Section 10.16(a), Customs Regulations (19 CFR 10.16(a)), provides that the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners.

Operations incidental to the assembly process whether performed before, during, or after assembly, do not constitute further fabrication, and shall not preclude the application of the exemption. An example of an operation which is considered incidental to the assembly process is the cutting to length of wire, thread, tape, foil, and similar products exported in continuous length. See, section 10.16(b)(6), Customs Regulations

In the instant case, the cutting to length of the fabric and strapping constitute an operation incidental to the assembly process pursuant to the above-cited regulation. Hemming the tarpaulins and sewing the textile strap for reinforcement are considered acceptable assembly operations. See, 19 CFR 10.16(a) and L'Eggs Products v. United States, Slip Op. 89-5, 13 CIT ___ 704 F.Supp. 1127 (CIT 1989), which held that sewing together the end of a pantyhose tube is considered an acceptable assembly operation as the thread serves as a joining agent by joining the tube to itself. Moreover, the operation whereby the grommets are attached to the tarpaulins is also considered an acceptable assembly operation pursuant to 19 CFR 10.16(a) and Headquarters Ruling Letter (HRL) 555671 of March 15, 1991.

HOLDING:

On the basis of the information presented, it is our opinion that the operations performed abroad to create textile tarpaulins are considered proper assembly operations or operations incidental to the assembly process. Therefore, the tarpaulins may enter under subheading 9802.00.80, HTSUS, with allowances in duty for the cost or value of the U.S. components incorporated therein, upon compliance with the documentary requirements of 19 CFR 10.24.

Sincerely,

John Durant, Director
Commercial Rulings Division

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