Request for binding ruling concerning fungibility of "TYVEK"; 19 U.S.C. 1313(j)(2)

HQ 223377 November 20, 1991 DRA-1-09-CO:R:C:E 223377 CB CATEGORY: Entry/Drawback Margaret T. Solinger, Esq. E. I. Du Pont de Nemours & Company Du Pont International Services Concord Plaza - Read Building Wilmington, Delaware 19898 RE: Request for binding ruling concerning fungibility of "TYVEK"; 19 U.S.C. 1313(j)(2) Dear Ms. Solinger: This is in response to your letter of July 25, 1991, wherein you propose to modify your request for approval to file same condition substitution drawback claims for "TYVEK" spunbonded olefin. "TYVEK" is a registered trademark of Du Pont. FACTS: Du Pont seeks approval to substitute "TYVEK" on a style-for- style basis, which would result in a weight variance of more than one gram per square meter, but less than 20 grams per square meter, as originally requested by Du Pont. You believe that "TYVEK" is fungible within each style number and substitution on this basis should be approved. According to your submisssion, "TYVEK" spunbonded olefin is a sheet product made from high-density polyethylene fibers, offering characteristics that combine some of the qualities of paper, film and cloth. "TYVEK" is formed by a continuous process in which very fine, 0.5-10 micrometer non-directional fibers (plexifilaments) are first spun and then bonded together by heat and pressure, without binders or fillers. "TYVEK" is produced in one "hard" and two "soft" structure types. Type 10, a "hard" structure, area-bonded product, is a smooth, stiff, non- directional, paper-like substrate. Types 14 and 16 are "soft" structure, point-bonded products with an embossed pattern, providing a fabric-like, flexible substrate. In a letter to the New York region, you requested that substitution be allowed with a weight difference of no greater than 20 grams per square meter, because of the wide divergence of -2- weight differences within each type of "TYVEK". However, you were advised by the Head Drawback Specialist in New York that based on the information available to the office regarding "TYVEK", substitution would not be allowed with a greater weight difference. You were advised to submit your request directly to this office. ISSUE: Whether a weight variance within a style destroys the fungibility of "TYVEK" for same condition substitution drawback purposes? LAW AND ANALYSIS: Section 1313(j)(2) of Title 19 was enacted as section 202 of the Trade and Tariff Act of 1984, Pub. L. No. 98-573, 98 Stat. 2948, 2973 (1984). Section 1313(j)(2) provides that, for substitution same condition drawback purposes, the merchandise substituted for exportation must be fungible with the duty-paid merchandise and in the same condition as was the imported merchandise at the time of its importation. In addition, the statute requires other conditions under subsections 1313(j)(2)(B), (C) and (D), which we will presume will be met. This ruling is limited to the issue of fungibility. Fungibility is defined in the Customs Regulations as "merchandise which for commercial purposes is identical and interchangeable in all situations." 19 CFR 191.2(a). Customs has interpreted fungibility as not requiring that merchandise be precisely identical; identical for "commercial purposes" allows some slight differences. The key is complete commercial interchangeability. As stated in C.S.D. 85-52: "[t]he commercial world consists of buyers, sellers, comminglers, government agencies and others. If these groups treat articles or merchandise as fungible or commercially identical, the articles or merchandise are fungible.... When two or more units of apparently identical properties are treated differently by the commercial world for any reason, they are not fungible." 19 Cust. Bull. 605, 607 (1985). You have stated, in your written request, that although each style of "TYVEK" tolerates some weight variance, this does not effect the commercial use of "TYVEK". You also state that a purchaser of "TYVEK" determines which style to obtain based on the intended use. "TYVEK" users do not perform any process to further reduce the weight variance within a style. In your request you included specifications such as thickness, tensile, etc. We find that these specifications have characterized the individual grades of "TYVEK" sufficiently to ensure "fungibility". -3- HOLDING: A style-for-style, pound-for-pound substitution meets the fungibility requirements for same condition drawback purposes under 19 U.S.C. 1313(j)(2). The one gram per square meter requirement is rescinded. Sincerely, John A. Durant, Director Commercial Rulings Division