The applicability of tariff classification in subheading 9801.00.2000, HTSUS, to Handbags, Wallets, and other articles from Italy, France, Germany and Thailand

N204922 March 15, 2012 CLA-2-42:OT:RR:NC:N4:441 CATEGORY: Classification TARIFF NO.: 9801.00.2000 Christopher L. Guzman Christian Dior NY Inc. 19 East 57th Street, 12 Floor New York, NY 10022 RE: The applicability of tariff classification in subheading 9801.00.2000, HTSUS, to Handbags, Wallets, and other articles from Italy, France, Germany and Thailand Dear Mr. Guzman: In your letter dated February 15, 2012, you requested a tariff classification ruling on whether handbag, wallets, and other articles were eligible for treatment in subheading 9801.00.2000, Harmonized Tariff Schedule of the United States (HTSUS). The imported products consist of handbags, wallets, and shoes made in Italy, women’s and men’s clothing made in France and Italy, and scarves, fashion jewelry and other accessories made in Italy, Germany, and Thailand. You state that the articles are non-mutilated samples that are at times exported internationally to other Dior offices located throughout the world for photo shoots and marketing purposes, only. The samples are owned by the Dior Press department in the United States and are limited in quantity. You have provided a copy of a use agreement. Dior retains legal ownership of the articles throughout the processes of photographing, marketing, and public relations. Section 141.2 of the Customs Regulations (19 CFR 141.2) states that "Dutiable merchandise imported and afterwards exported even though duty thereon may have been paid on the first importation, is liable to duty on every subsequent importation into the Customs territory of the United States" unless specifically exempted therefrom under the HTSUS. Subheading 9801.00.20, HTSUS, provides for duty-free treatment for "articles previously imported, with respect to which the duty was paid upon such previous importation or which were previously free of duty pursuant to the Caribbean Basin Economic Recovery Act of Title V of the Trade Act of 1974 if (1) reimported, without having been advanced in value or improved in condition by any process of manufacture or other means while abroad, after having been exported under lease or similar use agreements, and (2) reimported by or for the account of the same person who imported it into, and exported it from, the United States." Customs and Border Protection does not consider the mere photographing of a good for marketing purposes or otherwise as an advancement in value or improvement in condition. Section 10.108, Customs Regulations (19 CFR 10.108), provides, in relevant part, that free entry shall be accorded under subheading 9801.00.2000, HTSUS, whenever it is established to the satisfaction of the district director that the article for which free entry is claimed was exported from the United States under a lease or similar use agreement. The copy of the use agreement supplied indicates that Dior will loan the sample for a limited period of time for the purposes of marketing and public relations and that the items will be returned to the United States. Throughout this time period, ownership and title remain with Dior. Based on the information submitted, the handbags, wallets and other articles that are manufactured in Italy, France, Germany and Thailand will be eligible for duty-free treatment under subheading 9801.00.2000, HTSUS, when returned to the United States, provided that the district director at the port of entry is satisfied that Dior previously imported the bags and paid duty thereon; they are reimported by or for the account Dior; Dior exported the bags from the U.S. under a lease or a similar use agreement; and the documentary requirements of section 10.108, Customs Regulations, are satisfied. 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 Vikki Lazaro at 646-733-3041. Sincerely, Thomas J. Russo Director National Commodity Specialist Division