The tariff classification of PET polyester sheets and clamshells from Thailand

N234115 November 8, 2012 CLA-2-39:OT:RR:NC:N4:421 CATEGORY: Classification TARIFF NO.: 3920.62.0090; 3923.10.0000 Mr. David Harlow ITC Diligence, Inc. 15350 Stafford Street City of Industry, CA 91744 RE: The tariff classification of PET polyester sheets and clamshells from Thailand Dear Mr. Harlow: In your letter dated October 9, 2012, on behalf of Royal Inter Pack, Inc., you requested a tariff classification ruling. The imported merchandise consists of sheets of polyethylene terephthalate (PET) manufactured in Thailand from a blend of recycled and virgin PET pellets. You state that after importation the PET sheet will be thermoformed into the shapes of lidded clamshell containers. The containers will be used for packaging fresh produce such as grapes, berries, apples and tomatoes. You propose performing this operation in a Foreign Trade Zone (FTZ) located in the United States. You ask whether such merchandise may be eligible for duty free treatment under the Generalized System of Preferences (GSP) in subheading 3923.10.0000, Harmonized Tariff Schedule of the United States (HTSUS), as articles for the conveyance or packing of goods, of plastics. The applicable subheading for PET sheets will be 3920.62.0090, HTSUS, which provides for other plates, sheets, film, foil and strip, of plastics, noncellular and not reinforced, laminated, supported or similarly combined with other materials: of polycarbonates, alkyd resins, polyallyl esters or other polyesters: of poly(ethylene terephthalate)…other. The general rate of duty will be 4.2 percent ad valorem. The applicable subheading for clamshell packages made of PET will be 3923.10.0000, HTSUS, which provides for articles for the conveyance or packing of goods, of plastics…boxes, cases, crates and similar articles. The general rate of duty will be 3 percent ad valorem. Products classifiable in subheading 3920.62.0090, HTSUS, which are products of Thailand, are not entitled to duty free treatment under the GSP. Products classifiable in subheading 3923.10.0000, which are products of Thailand, may be entitled to duty free treatment under the GSP upon compliance with all applicable regulations. Under the GSP, eligible articles the growth, product or manufacture of a designated beneficiary developing country ("BDC"), which are imported directly into the customs territory of the United States 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 performed in the BDC, is equivalent to at least 35 percent of the appraised value of the article at the time of entry into the United States. In the circumstances that you describe, i.e., where sheets from Thailand are further manufactured in a U.S. FTZ into packaging articles, the packaging articles are not considered to be imported directly into the United States from the BDC, and thus would not be eligible for duty free treatment under the GSP. It appears that you may be requesting approval to perform manufacturing functions in a FTZ. Questions concerning such approval should be directed to the Foreign-Trade Zones Board, U.S. Department of Commerce, 1401 Constitution Ave., NW, Room 21013, Washington, DC 20230. 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 Joan Mazzola at (646) 733-3023. Sincerely, Thomas J. Russo Director National Commodity Specialist Division