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HQ 556799


October 20, 1992

CLA-2 CO:R:C:S 556799 RAH

CATEGORY: CLASSIFICATION

TARIFF NO.: 4015.11.00002

District Director
U.S. Customs Service
880 Front St., Room 5-S-9
San Diego, California 92188

RE: Application for Further Review of Protest Number 2501-92-100022; GSP; Latex Gloves

Dear Sir:

This is in response to your transmittal of June 10, 1992, regarding Protest No. 2501-92-100022.

FACTS:

The record reflects that the subject merchandise (rubber surgical and medical gloves) were imported into the United States from Mexico on November 13, 1991. The three entries subject to this protest were filed on November 12 an 13, 1991, and December 13, 1991. The entry summaries list Malaysia ("MY") as the country of origin of the merchandise. The merchandise was entered under subheading 4015.11.00002, Harmonized Tariff Schedule of the United States (HTSUS).

One entry was liquidated on March 3, 1992, and two entries were liquidated on March 6, 1992. Protest number 2501-92-100022 was timely filed on April 16, 1992, contesting the classification and liquidation of merchandise under subheading 4015.11.00.002, HTSUS, at the rate of 3.7 percent ad valorem.

The protestant claims that the merchandise is a product of Malaysia and was imported into the United States from that country under bond and merely repacked in Mexico in a maquiladora plant. The protestant further argues that the gloves are eligible for duty-free treatment under the Generalized System of Preference (GSP) because Malaysia is a GSP eligible country, and 100 percent of the value of the gloves (without the packing material) was attributed to costs of materials and direct processing in Malaysia.

ISSUE:

Whether latex gloves classified under subheading 4015.11.00.002, HTSUS, which are a product of Malaysia are entitled to duty free treatment under the GSP.

LAW AND ANALYSIS:

Under the GSP, eligible products which are the growth, product, or manufacture of a designated beneficiary developing country (BDC), may enter the U.S. duty-free if such products are imported directly into the U.S. and the sum of 1) the cost or value of the materials produced in the BDC, plus 2) the direct costs involved in processing the eligible article in the BDC, is equivalent to at least 35 percent of the appraised value of the article upon its entry into the U.S. 19 U.S.C. 2463(b).

The GSP eligibility list contains a wide range of products classifiable under approximately 3,000 different subheadings in the HTSUS. These items are identified either by an "A" or "A*" in the "Special" subcolumn under column 1 of the HTSUS. Merchandise classifiable under a subheading designated in this manner may qualify for duty-free entry if imported into the United States directly from any of the designated BDCs. Merchandise may, however, be excluded from the exemption if there is an "A*" in the "Special" column.

The uncontested country of origin of the merchandise in question is Malaysia, which is a designated BDC. See, General Note 3(c)(ii)(A), HTSUS. Moreover, the merchandise was entered under subheading 4015.11.00.002, HTSUS. General Note 3(c)(ii)(D) of the 1991 HTSUS (effective at the time of the subject entry) specifically excludes merchandise from Malaysia entered under that subheading from receiving duty-free treatment under the GSP. Accordingly, the protest should be denied.

HOLDING:

Pursuant to General Note 3(c)(ii)(D), HTSUS, merchandise from Malaysia entered under subheading 4015.11.10, HTSUS, is specifically excluded from receiving duty-free treatment under the GSP.

Sincerely,

John Durant, Director

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