SUBCHAPTER II
ARTICLES EXPORTED AND RETURNED, ADVANCED OR IMPROVED ABROAD
XXII
98-II-1
U.S. Notes
    1.    Except for goods subject to USMCA drawback this subchapter shall not apply to any article exported:   
(a) From continuous customs custody with remission, abatement or refund of duty;
(b) With benefit of drawback;
(c) To comply with any law of the United States or regulation of any Federal agency requiring exportation; or
(d) After manufacture or production in the United States under heading 9813.00.05.
2. 
(a) Except as provided in paragraph (b), any product of the United States which is returned after having been advanced in value or improved in condition abroad by any process of manufacture or other means, or any imported article which has been assembled abroad in whole or in part of products of the United States, shall be treated for the purposes of this Act as a foreign article, and, if subject to a duty which is wholly or partly ad valorem, shall be dutiable, except as otherwise prescribed in this part, on its full value determined in accordance with section 402 of the Tariff Act of 1930, as amended. If such product or such article is dutiable at a rate dependent upon its value, the value for the purpose of determining the rate shall be its full value under the said section 402.
(b) No article (except a textile article, apparel article, or petroleum, or any product derived from petroleum, provided for in heading 2709 or 2710) may be treated as a foreign article, or as subject to duty, if--
(i) the article is--
(A) assembled or processed in whole of fabricated components that are a product of the United States, or
(B) processed in whole of ingredients (other than water) that are a product of the United States, in a beneficiary country; and
(ii) neither the fabricated components, materials or ingredients, after exportation from the United States, nor the article itself, before importation into the United States, enters the commerce of any foreign country other than a beneficiary country.
As used in this paragraph, the term "beneficiary country" means a country listed in general note 7(a).
3.  Articles repaired, altered, processed or otherwise changed in condition abroad.--The following provisions apply only to subheadings 9802.00.40 through 9802.00.60, inclusive:
(a) The value of repairs, alterations, processing or other change in condition outside the United States shall be:
(i) The cost to the importer of such change; or
(ii) If no charge is made, the value of such change,
as set out in the invoice and entry papers; except that, if the appraiser concludes that the amount so set out does not represent a reasonable cost or value, then the value of the change shall be determined in accordance with section 402 of the Tariff Act of 1930, as amended.
(b) No appraisement of the imported article in its changed condition shall be required unless necessary to a determination of the rate or rates of duty applicable to such article. 
(c) The duty, if any, upon the value of the change in condition shall be at the rate which would apply to the article itself, as an entirety without constructive separation of its components, in its condition as imported if it were not within the purview of this subchapter. If the article, as returned to the United States, is subject to a specific or compound rate of duty, such rate shall be converted to the ad valorem rate which when applied to the full value of such article determined in accordance with said section 402 would provide the same amount of duties as the specific or compound rate. In order to compute the duties due, the ad valorem rate so obtained shall be applied to the value of the change in condition made outside the United States. 
(d) For the purposes of subheading 9802.00.40 and 9802.00.50, the rates of duty in the "Special" column 1 followed by the symbol "S" in parentheses shall apply to any goods which are returned to the United States after having been repaired in Canada or Mexico, respectively, whether or not such goods are goods of Canada or Mexico under the terms of general note 11 to the tariff schedule.
    (e)     For purposes of subheading 9802.00.60, the term "metal" covers (1) the base metals enumerated in note 3 to section XV; (2) arsenic, barium, boron, calcium, mercury, selenium, silicon, strontium, tellurium, thorium, uranium and the rare-earth elements; and (3) alloys of any of the foregoing.   
    (f) 
(i) For purposes of subheadings 9802.00.40 and 9802.00.50, fungible articles exported from the United States for the purposes described in such subheadings--					
(A) may be commingled; and					
(B) the origin, value, and classification of such articles may be accounted for using an inventory management method.					
(ii) If a person chooses to use an inventory management method under this paragraph with respect to fungible articles, the person shall use the same inventory management method for any other articles with respect to which the person claims fungibility under this paragraph.					
(iii) For the purpose of this paragraph--					
(A) the term 'fungible articles' means merchandise or articles that, for commercial purposes, are identical or interchangeable in all situations; and					
(B) the term 'inventory management method' means any method for managing inventory that is based on generally accepted accounting principles.					
  4.   Articles assembled abroad with components produced in the United States.--The following provisions apply only to headings 9802.00.80 and 9802.00.91:  
(a) The value of the products of the United States assembled into the imported article shall be:
(i) The cost of such products at the time of the last purchase; or
(ii) If no charge is made, the value of such products at the time of the shipment for exportation,
as set out in the invoice and entry papers; except that, if the appraiser concludes that the amount so set out does not represent a reasonable cost or value, then the value of such products shall be determined in accordance with section 402 of the Tariff Act of 1930, as amended.
(b) The duty, if any, on the imported article shall be at the rate which would apply to the imported article itself, as an entirety without constructive separation of its components, in its condition as imported if it were not within the purview of this subchapter. If the imported article is subject to a specific or compound rate of duty, the total duties shall be reduced in such proportion as the cost or value of such products of the United States bears to the full value of the imported article.
5. No imported article shall be accorded partial exemption from duty under more than one provision in this subchapter.
6. Notwithstanding the partial exemption from ordinary customs duties on the value of the metal product exported from the United States provided under subheading 9802.00.60, articles imported under subheading 9802.00.60 are subject to all other duties, and any other restrictions or limitations, imposed pursuant to title VII of the Tariff Act of 1930 (19 U.S.C. 1671 et seq.), or chapter 1 of title II or chapter 1 of title III of the Trade Act of 1974 (19 U.S.C. 2251 et seq., 19 U.S.C. 2411 et seq.).
7. 
(a)  For purposes of the special tariff treatment authorized by the African Growth and Opportunity Act (AGOA) (title I of Pub.L. No. 106-200) for certain goods of heading 9802.00.80 imported directly from those beneficiary sub-Saharan African countries previously designated by proclamation that are subsequently enumerated in a notice published in the Federal Register by the United States Trade Representative (USTR) as having been determined to have satisfied the requirements of the AGOA and therefore to be afforded such tariff treatment, the duty-free treatment indicated for such heading shall apply only to apparel articles sewn or otherwise assembled in one or more such beneficiary countries from fabrics wholly formed and cut, or from components knit-to-shape, in the United States, from yarns wholly formed in the United States, or both (including fabrics not formed from yarns, if such fabrics are classifiable under heading 5602 or 5603 of chapter 56 and are wholly formed and cut in the United States). Articles otherwise eligible to enter under this heading, and which satisfy the conditions set forth in U.S. note 3 to subchapter XIX of this chapter, shall not be ineligible to enter under this heading. Such countries shall be enumerated in this note whenever the USTR issues a Federal Register notice as described herein. Articles covered by the provisions of this note shall be eligible to enter the customs territory of the United States free of quantitative limitations. The USTR has determined that the following countries have adopted an effective visa system and related procedures and have satisfied the customs requirements of the AGOA and, therefore, are to be afforded the tariff treatment provided for in this note:
           Benin, Botswana, Cape Verde, Chad, Cote d'Ivoire, Eswatini, Ghana, Kenya, Lesotho, Republic of Liberia, Madagascar, Malawi, Mauritius, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Sierra Leone, South Africa, Tanzania, Zambia         
(b) 
(i) For purposes of heading 9802.00.80, duty-free treatment shall be accorded to the following articles imported directly from a beneficiary United States-Caribbean Basin Trade Partnership Act (CBTPA) country previously designated by the President in a proclamation issued pursuant to such Act and enumerated in general note 17(a) to the tariff schedule--
(A) apparel articles sewn or otherwise assembled in one or more such beneficiary countries from fabrics wholly formed and cut, or from components knit-to-shape, in the United States, from yarns wholly formed in the United States, or both (including fabrics not formed from yarns, if such fabrics are classifiable under heading 5602 or 5603 of chapter 56 and are wholly formed and cut in the United States) provided they otherwise comply with the provisions of this note; or
(B) textile luggage assembled in a designated beneficiary country from fabric wholly formed and cut in the United States, from yarns wholly formed in the United States.
Articles otherwise eligible to enter under this heading, and which satisfy the conditions set forth in U.S. note 3 to subchapter XX of this chapter, shall not be ineligible to enter under this heading. Articles covered by the terms of this note shall be admitted into the customs territory of the United States free of quantitative limitations. Apparel articles entered on or after September 1, 2002, that are assembled in a beneficiary CBTPA country from knitted or crocheted fabrics or from woven fabrics shall be eligible to receive the duty treatment provided for in this note only if all dyeing, printing and finishing of such fabrics from which the articles are assembled is carried out in the United States. The following countries have been determined by the USTR to have satisfied the customs requirements of the CBTPA and, therefore, to be afforded the tariff treatment provided for in this note:
    Barbados, Belize, Curaao, Guyana, Haiti, Jamaica, Saint Lucia, Trinidad and Tobago   
(ii) Articles that undergo production in a CBTPA beneficiary country and a former CBTPA beneficiary country.
(A) For purposes of determining the eligibility of an article for preferential treatment under this subdivision, references to--
(1) a "CBTPA beneficiary country" shall be considered to include any former CBPTA beneficiary country, and
(2) "CBTPA beneficiary countries" shall be considered to include former CBTPA beneficiary countries,
if the article, or a good used in the production of the article, undergoes production in a CBPTA beneficiary country.
(B) An article that is eligible for preferential treatment under subdivision (ii)(A) of this note shall not be ineligible for such treatment because the article is imported directly from a former CBTPA beneficiary country.
(C) Notwithstanding subdivisions (e)(ii)(A) and (e)(ii)(B), an article that is a good of a former CBTPA beneficiary country for purposes of section 304 of the Tariff Act of 1930 (19 U.S.C. 1304) or section 334 of the Uruguay Round Agreements Act (19 U.S.C. 3592), as the case may be, shall not be eligible for preferential treatment under this note.?
(D) 
(1) The term "former CBTPA beneficiary country" means a country that ceases to be designated as a CBTPA beneficiary country under this note because the country has become a party to a free trade agreement with the United States.
(2) For the purposes of this subdivision, the following countries are former CBTPA beneficiary countries:
El Salvador
Guatemala
Honduras
Nicaragua
Dominican Republic
Costa Rica
Panama
(E) Notwithstanding subdivision (ii)(C) of this note, an article shall be eligible for preferential treatment under this note if--
(1) the article is a good of Dominican Republic for purposes of section 304 of the Tariff Act of 1930 (19 U.S.C. 1304) or section 334 of the Uruguay Round Agreements Act (19 U.S.C. 3592), as the case may be, and
(2) the article, or a good used in the production of the article, undergoes production in Haiti.
Statistical Notes
1.  For articles admitted under statistical reporting number 9802.00.6000, 9802.00.8015, 9802.00.8016, 9802.00.8055 or 9802.00.8068 two values shall be reported--the first following the first statistical reporting number of the statistical citation (i.e., 9802.00.6000, 9802.00.8015, 9802.00.8016, 9802.00.8055 or 9802.00.8068) and the second following the statistical reporting number of the provision in chapters 1-97 from which the rate of duty is derived, as follows:
(a) For statistical reporting number 9802.00.6000:
(i) The total value of the article less the value of the foreign processing; and
(ii) The dutiable value, i.e., the value of the foreign processing, respectively. 
(b)  For statistical reporting number 9802.00.8015, 9802.00.8016, 9802.00.8055 or 9802.00.8068:
(i) The value of the U.S. fabricated components; and
(ii) The dutiable value, i.e., the total value of the articles less the value of the U.S. fabricated components, respectively. 
2. For articles for which duty free treatment is claimed under U.S. note 2(b) or 7 to subchapter II of this chapter, the citation to be used in statistical reporting shall be the 10-digit statistical reporting number provided in this subchapter followed by the reporting number of the provision in chapters 1 through 97 which would ordinarily apply to the articles. The unit of quantity reported hereunder for such articles shall be the same as the unit of quantity for the provision from chapters 1 through 97. 
For articles admitted under statistical reporting numbers 9802.00.5010, 9802.00.8040, 9802.00.8042, 9802.00.8044, 9802.00.8046 and 9802.00.8048 two values shall be reported--the first following the first statistical reporting number of the statistical citation (i.e., 9802.00.5010, 9802.00.8040, 9802.00.8042, 9802.00.8044, 9802.00.8046 or 9802.00.8048) and the second following the statistical reporting number of the provision in chapters 1-97 which would ordinarily apply:
(a) For statistical reporting number 9802.00.5010:
(i) The total value of the article less the value of the foreign processing; and
(ii) The dutiable value, i.e., the value of the foreign processing, respectively. 
(b)  For statistical reporting numbers 9802.00.8040, 9802.00.8042, 9802.00.8044, 9802.00.8046 and 9802.00.8048:
(i) The value of the U.S. fabricated components or materials; and
(ii) The dutiable value, i.e., the total value of the articles less the value of the U.S. fabricated components, respectively.
  3.  For articles admitted under statistical reporting number 9802.00.9100 the citation to be used in statistical reporting shall be 9802.00.9100 followed by the statistical reporting number of the provision in chapters 1-97 which would ordinarily apply to the articles. The unit of quantity reported hereunder for such articles shall be the same as the unit of quantity for the provision from chapters 1 to 97. In addition, two values shall be reported--the first following statistical reporting number 9802.00.9100 and the second following the statistical reporting number from chapters 1-97, as follows:  
(a) The value of the products of the United States assembled into the imported articles; and
(b) The total value of the articles less the value of the products of the United States assembled into the imported articles, respectively. 

Back