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HQ 559070




November 20, 1995

CLA-2 R:C:S 559070 AT

CATEGORY: CLASSIFICATION

Port Director of Customs
Dallas/Fort Worth, Texas

RE: Application for Further Review of Protest No. 5501-94-100332 concerning classification and GSP eligibility of ostrich leather; imported directly; 19 CR 10.175

Dear Sir:

This is in response to your memorandum dated February 24, 1995, forwarding the Application for Further Review from The I.C.E. Co., Inc. ("I.C.E."), on behalf of Durland-Larson Sales, Inc. ("Durland") concerning the classification and duty eligibility under the Generalized System of Preferences ("GSP") for ostrich leather imported into the U.S. from South Africa during the period of May 13 through October 21, 1994. We have also considered in connection with this protest information submitted by I.C.E. on November 3, 1995.

FACTS:

The protestant claims that the subject entries of ostrich leather are eligible for duty-free treatment under the GSP and should be classified under 4107.90.6000, Harmonized Schedule of the United States ("HTSUS") as fancy leather, rather than under 4107.90.3000, HTSUS, as liquidated. According to the protestant all the ostrich leather covering the subject entries was imported directly from South Africa into the U.S. to be further processed. In support, protestant has submitted documentary evidence (South African declarations for importation or exportation of fish or wildlife, commercial invoices, airway bills, etc.) indicating that the merchandise covered under the entries of this protest were exported directly from South Africa to the U.S. We have been informed by your office that you agree with protestant that the ostrich leather covered under the subject entries should be classified as "fancy leather" under 4107.00.6000, HTSUS. We also have been advised by your office that with respect to the GSP eligibility issue, you agree with protestant that all of the entries covered under this protest, except Entry No. 1530061643-8, are eligible for duty treatment under the GSP.

On November 3, 1995, I.C.E., faxed a letter to this office requesting that the above-specified entry be deleted for consideration for GSP eligibility, since it failed to look at the invoice to notice that the goods under this entry were shipped directly from Italy, rather than South Africa.

ISSUES:

Whether the imported ostrich leather from South Africa covered under the entries of this protest should be considered "imported directly" for purposes of the GSP.

LAW AND ANALYSIS:

Under the GSP, eligible articles the growth, product or manufacture of a beneficiary developing country ("BDC") which are imported directly into the customs territory of the U.S. from a BDC may receive duty-free treatment if the sum of (1) the cost or value of materials produced in the BDC, plus (2) the direct costs of the processing operations in the BDC, is equivalent to at least 35% of the appraised value of the article at the time of entry into the U.S. See, 19 U.S.C. 2463(b).

As stated in General Note 4(a), HTSUS, South Africa is a designated BDC. We agree with your office and the protestant that the ostrich leather covered under the entries of this protest is properly classified under subheading 4107.90.6000, HTSUS, which provides for "Leather of other animals. . . Of other animals: Fancy". Articles provided for in this provision are eligible for duty-free treatment under the GSP provided that they are a "product of" a BDC, and the GSP imported directly and 35% value-content requirement are met.

The question presented in this protest is whether the subject merchandise which was shipped from South Africa to the U.S. is considered to be "imported directly" into the U.S. from a BDC for purposes of satisfying 19 CFR 10.175. Section 10.175 states in part that:

Eligible articles shall be imported directly from a beneficiary developing country to qualify for treatment under the Generalized System of Preferences. For purposes of section 10.171 through 10.178 the words "imported directly" mean:

(a) Direct shipment from the beneficiary country to the United States without passing through the territory of any other country;

Since the submitted documentation (South African export/import declarations, commercial invoices and airway bills) indicates that the merchandise covered by the entries of this protest, except for the above-specified entry as stated in I.C.E.'s fax dated November 3, 1995, was shipped directly from South Africa to the U.S., the "imported directly" requirement of 10.175(a) is satisfied. Therefore, except for the above-specified entry, the merchandise covered under the remaining entries of this protest are entitled to duty-free treatment under the GSP.

HOLDING:

Upon review of the documentary evidence submitted with the protest, we find that the ostrich leather covered under the entries of this protest is properly classified under subheading 4107.90.6000, HTSUS, as fancy leather. Except for the entry specified above, the ostrich leather covered under the remaining entries of this protest are entitled to duty-free treatment under the GSP. Accordingly, the protest should be granted in part and denied in part in accordance with this discussion.

In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director

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