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HQ 953095




APRIL 15 1993

CLA-2:CO:R:C:M 953095 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 7318.15.60, HTSUS

Mr. Joseph B. Castellano
Rudolph Miles & Sons
P.O. Box 2489
Laredo, TX 78044-2489

RE: Steel Screws, Plastic Wall Anchors, Plastic Bag; Mounting Hardware for Wall Thermometer; Sets, GRI 3(b), HTSUS

Dear Mr. Castellano:

In a letter dated December 9, 1992, on behalf of Lux Products Corporation, you inquire as to the tariff classification for an installation kit for use in mounting a household wall thermostat. A sample was submitted. Our Value and Marking Branch will issue a separate ruling on the country of origin marking issue.

FACTS:

Under the facts presented, steel screws of Taiwanese origin will be shipped to Mexico along with plastic wall anchors and plastic bags of United States origin. In Mexico, four (4) screws and two (2) wall anchors will be packaged in one plastic bag and the bag sealed with tape. The packaged screws and wall anchors will then be placed in U.S.-origin cardboard cartons to complete an installation kit. Upon return to the United States, the importer will place one installation kit in a box containing one thermostat ready for retail sale.

ISSUE:

Whether the installation kit is a set for tariff purposes; whether there is an allowance for the components of U.S. origin.

LAW AND ANALYSIS:

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined - 2 -
according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6. GRI 6 provides, in part, that the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes, and by appropriate substitution of terms, according to GRIs 1 through 5.

As to the first issue, General Rule of Interpretation (GRI) 3(b), Harmonized Tariff Schedule of the United States (HTSUS), states in part that goods put up in sets for retail sale which cannot be classified by reference to rule 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable. For purposes of GRI 3(b), the term "goods put up in sets for retail sale" shall be taken to mean goods which: (a) consist of at least two different articles which are, prima facie, classifiable in different headings, (b) consist of products or articles put up together to meet a particular need or carry out a specific activity, and (c) are put in a manner suitable for sale directly to users without repacking.

Two of the screws are type A slotted pan head steel tapping screws of the type classifiable in subheading 7318.14.10, HTSUS, a provision for self-tapping screws having shanks or threads with a diameter of less than 6mm. The other two screws are slotted pan head steel machine screws. Because they do not meet the size requirements under the eo nomine provision for machine screws in subheading 7318.15.40, they are classifiable in subheading 7318.15.60, HTSUS, as other screws having shanks or threads with a diameter of less than 6mm. The two plastic wall anchors are internally threaded. They line the holes in the wall and expand as the tapping screws are screwed into them. The wall anchors are classifiable in subheading 3926.90.90, HTSUS, as other articles of plastics.

The packaged screws and wall anchors meet the requirements for a set under GRI 3(b). However, it is our opinion that none of the articles imparts the essential character to the set. Therefore, under rule 3(c), made applicable at the subheading level by rule 6, the set is classifiable in subheading 7318.15.60, the provision that occurs last in numerical order. The rate of duty under this provision is 6.2 percent ad valorem.

As to the second issue, subheading 9801.00.10, HTSUS, provides for the free entry of products of U.S. origin that are exported and returned without having been advanced in value or improved in condition by any means while abroad, provided the documentary requirements of section 10.1, Customs Regulations, are met. We have previously held that in the absence of an alteration or change in the U.S.-origin articles, the mere - 3 -
repackaging of these articles abroad even for the purpose of resale to the ultimate consumer, is not sufficient to preclude the merchandise from being classified in subheading 9801.00.10. See HQ 555577, dated June 19, 1990. In our opinion, the described operations performed in Mexico are simple packaging operations that do not advance in value or improve in condition the U .S.-origin components. The U.S.-origin plastic bags and cardboard cartons are also entitled to subheading 9801.00.10 treatment pursuant to HQ 731806, dated November 18, 1988.

HOLDING:

The installation kits, as described, are sets for tariff purposes. Upon their return to the Customs territory from Mexico, they are classifiable in subheading 7318.15.60, HTSUS, dutiable at the rate of 6.2 percent ad valorem.

As the components in the set of U.S. origin, and the U.S.- origin packaging materials, will not be advanced in value or improved in condition as a result of the processing operations in Mexico, these items qualify for the duty exemption under subheading 9801.00.10, upon compliance with the documentary requirements of section 10.1, Customs Regulations.

Sincerely,

John Durant, Director
Commercial Rulings Division

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