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HQ 555675


November 26, 1990

CLA-2 CO:R:C 555675 RA

CATEGORY: CLASSIFICATION

TARIFF NO.: 9802.00.80

Mr. David S. Simpson, Jr.
Vice President
William F. Joffroy, Inc.
P.O. Box 698
Nogales, Arizona 85628-0698

RE: Applicability of subheading 9802.00.80, HTSUS, to string trimmers assembled in Mexico

Dear Mr. Simpson:

This is in response to your letter of May 14, 1990, requesting a ruling, on behalf of the McCullcch Corporation of Tucson, Arizona, regarding the applicability of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS), to string trimmers assembled in Mexico from U.S.-made components.

FACTS:

Components for a string trimmer are exported to Mexico for assembly operations which result in a finished unit. In these operations, a metal tube used as a handle is cut to a length of 44 inches, deburred, and after removal of the sharp edges is bent to approximately a 55 degree angle one foot from one end. The bending of the tubular handle is required so that when the trimmeris held in the hand and operated to cut grass or weeds, the cutter head is horizontal to the ground. You contend that the bending is merely an adjustment in the shape of the tubing required by the assembly and, therefore, is incidental thereto. The other assembly operations appear to qualify as either assembly steps or incidental to this processing.

ISSUE:

Does the bending of the tubing constitute an operation incidental to assembly so as to qualify this component for an allowance in duty under subheading 9802.00.80, HTSUS?

LAW AND ANALYSIS:

Subheading 9802.00.80, HTSUS, provides a partial duty exemption for articles assembled abroad in whole or in part of fabricated components of U.S. origin with no operations performed thereon except the joining of the components and operations incidental thereto. The U.S. components must be exported in condition ready for assembly without further fabrication, and cannot lose their physical identity in the assembled article by change in form, shape or otherwise. Duty is assessed on the full appraised value of the imported merchandise less the cost or value of the U.S.-made components, upon compliance with the documentation requirements of section 10.24, Customs Regulations (19 CFR 10.24).

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

[t]he components must be in condition ready for assembly without luther 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.

Operations incidental to the assembly process are not considered further fabrication operations, as they are of a minor nature and cannot always be provided for in advance of the assembly operation. Examples of operations considered incidental to the assembly process are delineated at section 10.16(b), Customs Regulations (19 CFR 10.16(b)). One of these examples provides for "[a]djustments in the shape or form of a component to the extent required by the assembly being performed abroad."

However, 19 CFR 10.16(c) provides that any significant process, operation, or treatment other than assembly whose primary purpose is the fabrication, completion, physical or chemical improvement of a component shall not be regarded as incidental to assembly and shall preclude the application of the exemption to such component.

In Samsonite Corporation v. United States, 12 CIT 702 F.Supp. 908 (1988), aff'd, 8 Fed. Cir. __, 889 F.2d 1074 (1989), the court held that the bending of U.S. steel strips to form the frames for luggage did more than "adjust" the article; it created the component to be assembled, the essence
of which was its configuration. The court stated that the statute and attendant regulations do not cover a process which is as necessary to the fabrication of the component as it is to the subsequent assembly thereof. Thus, it was held that the steel strips were not exported in condition ready for assembly without further fabrication, as required by the statute.

As in the Samsonite case, the metal tubes in this case are straight when exported and are not capable of immediately entering into the assembly process as exported, but require the bending operation (in addition to the cutting-to-length and deburring operations) before assembly can begin. In our opinion, bending the tube is more than an "adjustment" of the component; it is a continuation of the fabrication of the tube component, begun in the U.S., and is necessary to the completion of the component to be assembled. In support of this conclusion, see Headquarters Ruling Letters (HRL's) 554962 dated May 15, 1989 (the heating and bending of a pre- cut metal tube into a spiral configuation prior to its incorporation into a range heating element constitute a further fabrication), and 555290 dated April 17, 1990 (a U.S. plastic tube component of a sports bottle which was heated and bent abroad prior to its assembly was not exported in condition ready for assembly without further fabrication).

HOLDING:

The cutting, deburring and bending of metal tubing for a string trimmer to fit the contour required for optimum use in the device constitute a further fabrication of the component abroad. Therefore, no allowance in duty may be made under subheading 9802.00.80, HTSUS, for the cost or value of the metal tubing. However, allowances in duty may be under this tariff provision for the cost or value of the U.S. components (other than the tubing) which are merely assembled abroad to create the string trimmer, upon compliance with the documentation requirements of 19 CFR 10.24.

Sincerely,

John Durant, Director
Commercial Rulings Division


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