Eligibility of woven shirts for partial duty exemption under subheading 9802.00.50, HTSUS

NY M80438 March 20, 2006 CLA-2-62:RR:NC:N3:360 M80438 CATEGORY: Classification TARIFF NO.: 9802.00.50 Joan Studeny Account Manager GHY USA Inc. Customs Brokers/Trade Consultants 572 South Fifth Street Pembina, ND 58271 RE: Eligibility of woven shirts for partial duty exemption under subheading 9802.00.50, HTSUS Dear Ms. Studeny: In your letter dated February 13, 2006, on behalf of Western Glove Works, you requested a ruling on the eligibility for reduced duty status under 9802.00.50, Harmonized Tariff Schedule of the United States (HTSUS) for men’s and women’s woven shirts subject to embellishing operations such as hand painting, patch work, beading and riveting and appliqué. You submitted samples of the finished items showing the garments after the embellishments have been added. As requested, your samples will be returned. Representative styles L016-21W, L016-L, M014-21W and L033-LW were submitted for review. The submitted samples are men’s and women’s woven shirts constructed from either 100% cotton or 100% linen fabric. You have indicated that the shirts are manufactured in China and imported into the United States with the appropriate invoices and documentation. The garments are then exported to Japan where they will have the following operations performed: hand painting, patch work, beading and riveting and appliqué. The garments will then be re-imported into the United States by the original importer of record. Subheading 9802.00.50, HTSUS, provides a partial or complete duty exemption for articles exported from and returned to the U.S. after having been advanced in value or improved in condition by repairs or alterations, provided that documentary requirements of Section 10.8, Customs Regulations (19 C.F.R. 10.8), are satisfied. However, entitlement to this tariff treatment is precluded in circumstances where the operations performed abroad destroy the identity of the exported articles or create new or commercially different articles through a process of manufacture. Subheading 9802.00.50, HTSUS, treatment is also precluded where the exported articles are incomplete for their intended use and the foreign processing operation is a necessary step in the preparation or manufacture of finished articles. In the Customs Bulletin of October 4, 2000, several rulings were revoked or modified to reflect a change in the manner in which Customs treated decoration or embellishment of articles. It was determined that decoration of articles was an acceptable alteration, and did not result in a new or different good. This office believes that the embellishing operations that occur in Japan qualify as acceptable operations under subheading 9802.00.50, HTSUS. The garments in condition as exported and returned to the United States have the same use when sold to consumers. The operations in Japan do not result in the loss of the good’s identity; neither do they create a new article with a new and different commercial use. Therefore, the operations that occur in Japan constitute an acceptable alteration within the meaning of 9802.00.50, HTSUS, and the garments qualify for the special tariff treatment of that provision. You also question whether the garments are subject to visa and quota restrictions upon reimportation into the United States. The Committee for the Implementation of Textile Agreements (CITA) published a notice in the Federal Register of December 29, 2004 (69 Fed Register 78001) exempting certain textile and textile products from China from Safeguard Import Limits. The notice states in part: Properly marked commercial samples valued at U.S.$800 or less and importations under HTS items: 9801.00.20 9801.00.25 9801.00.26 9802.00.40 9802.00.50 9811.00.60 9813.00.05 9817.60.00 shall not be charged to applicable quota limits. Therefore, the garments undergoing the alteration process outlined in this ruling are not subject to visa and quota requirements. Quota and visa status are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information as to whether quota and visa requirements apply to this merchandise, we suggest that you check, close to the time of shipment, the “Textile Status Report for Absolute Quotas” available at our web site at www.cbp.gov. In addition, you will find current information on textile import quotas, textile safeguard actions and related issues at the web site of the Office of Textiles and Apparel, at otexa.ita.doc.gov. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Patricia Schiazzano at 646-733-3051. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division