HQ 0951820 - Classification of 100% silk unisex undershirts; revocation of NYRL 843663 of August 17, 1989; effective date delayed pursuant to 19 CFR 177.9(d)(3) in accordance with HRL 950160 of October 11, 1991 - United States International Trade Commision Rulings

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HQ 951820

December 23, 1992

CLA-2 CO:R:C:T 951820 CAB

CATEGORY: CLASSIFICATION

Mr. Alan R. Klestadt, Esq.
Grunfeld, Desiderio, Lebowitz & Silverman 12 East 49th Street
New York, NY 10017

RE: Classification of 100% silk unisex undershirts; revocation of NYRL 843663 of August 17, 1989; effective date delayed pursuant to 19 CFR 177.9(d)(3) in accordance with HRL 950160 of October 11, 1991

Dear Mr. Klestadt:

This is in reply to your letter of March 12, 1992, on behalf of Terramar Sports Worldwide, Ltd., in which you requested that the effective date of Headquarters Ruling Letter (HRL) 089950, be delayed until November 6, 1991 with respect to Terramar Sports Worldwide, Ltd.

In HRL 089950, dated August 6, 1991, Customs revoked New York Ruling Letter (NYRL) 843663, dated August 17, 1989. That ruling, issued to White Pine Co., classified silk unisex undershirts under Headings 6107 and 6108, of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA); the rate of duty was 4 percent ad valorem. HRL 089950 reclassified the garments in subheading 6109.90.2020, HTSUSA, with a duty rate of 17 percent ad valorem.

In HRL 950160, dated October 11, 1991, Customs determined that White Pine had suffered a detriment since merchandise contracted for prior to the issuance of HRL 089950 was now subject to a higher duty. Thus, the effective date of HRL 089950 was delayed with respect to merchandise imported by White Pine.

It appears that Terramar and White Pine are "friendly competitors" and White Pine furnished a copy of NYRL 843663 to Terramar. After receiving NYRL 843663, Terramar placed a series of purchase orders for silk undershirts, backed by irrevocable letters of credit beginning on March 22, 1991. One of the purchase orders, placed on August 12, 1991, was placed after the August 6, 1991, revocation of NYRL 843663. All of the goods in question arrived between July 26, 1991 and November 3, 1991. You are contending that the garments which were the subject of NYRL 843663 are substantially identical to the garments at issue in this instance. Thus, Terramar relied upon NYRL 843663 to classify the instant merchandise. Since NYRL 843663 was revoked, effective August 6, 1991, Terramar suffered a detriment in regards to the merchandise that was contracted for before August 6, 1991. You claim that Terramar acted reasonably and in good faith in its reliance on NYRL 843663, both when pricing the merchandise and classifying the merchandise. Under 19 C.F.R. 177.9(d)(3), the effective date of a ruling letter that revokes an earlier ruling may be delayed for a period of ninety days, provided that the party seeking delay can demonstrate to the satisfaction of the Customs service that reliance on the revoked ruling was reasonable and such reliance was to the detriment of that party.

After examining the submitted information which consisted of irrevocable letters of credit, purchase orders, entry summaries, and an affidavit signed by an official agent of Terramar, it appears that Terramar suffered a detriment in that merchandise contracted for prior to the issuance of HRL 089950 is presently subject to a higher duty rate. It was reasonable for Terramar to rely on the duty rate set forth in NYRL 843633, and therefore, the prerequisite for relief under 19 CFR 177.9(d)(3) has been met. Any relief provided by Customs, however, shall not extend to purchase orders placed after August 6, 1991. Accordingly, any forthcoming relief shall not pertain to goods listed in entry 230-0150622-1 regarding Style Number SL2006, since the corresponding purchase order is dated August 12, 1991, after the August 6, 1991 revocation of NYRL 843663.

Based upon your submission, the merchandise imported by Terramar that was affected by HRL 089950 is listed in the following entries: 335-0108587-3; 335-0109797-7; 230-0148140-9; 230-0148139-1; 230-0148143-3; 230-0148544-2; 230-0148943-6; 230-0149367-7; 230-0149852-8; 230-0149851-0; 230-0150146-1; 230-0150256-8; 230-0149015-2; 230-0149015-2; 230-0150622-1; 230-0151099-1; 230-0149003-8; 230-0148154-0; 230-0145085-9; 230-0145206-1; 230-0146116-1; 230-0147092-3; 230-0147712-6; 230-0148058-3; 230-0148643-2; 230-0149811-1; 230-0148154-0; 230-0149884-1.

Consequently, with respect to Terramar Sports Worldwide, Ltd., the merchandise as described in NYRL 843663 and covered by the entries listed above, will be classified in accordance with NYRL 843663.

Sincerely,

John Durant, Director
Commercial Rulings Division

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