CLA-2 CO:R:C:G JS 086700

TARIFF NO: 6210.10.2000

Shelton Townley
Rogers & Brown Custom Brokers, Inc.
P.O. Box 937
Greer, South Carolina 29652

RE: Surgical Pack

Dear Ms. Townley:

This is in reference to your letter of February 28, 1990, and January 26, 1990, on behalf of Mars White Knight, requesting classification of a surgical pack under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), to be imported from Mexico. The sample you provided will be returned under separate cover.

FACTS:

The merchandise at issue is called Lap Ultrapack 14-8824 and is comprised of sixteen items as follows:

1 large Sontara scrub nurse gown (in over wrap) 2 large Sontara sterile back gowns 3 hand towels 2 absorbent towels 4 utility drapes with tape 1 wing laparotomy sheet with tape 1 suture bag 1 table cover 1 mayo stand cover

These items are intended for one-time use in a surgical procedure known as a "laparotomy". The Sontara gowns are made of a material which is composed of a polyester fiber batt and a wood pulp paper which are hydraulically combined by a patented water jet process. Our telephone conversation of May 8, 1990, confirmed that all of the items, with the exception of the

Sontara gowns and the laparotomy sheet, are shipped in completed form from the United States to Mexico where they are packaged for retail sale. The Sontara items and laparotomy sheet, however, are shipped to Mexico as cut fabricated components, which are then sewn together and packaged with the other items stated above. The completed surgical pack is then subjected to a sterilization process in the United States.

Whereas Haiti was mentioned as a country of importation in a letter by the importer dated January 15, 1990, only Mexico will be considered for Chapter 98 treatment pursuant to the information provided in your subsequent letters and the telephone conversation referenced above.

ISSUE:

1) Is the Lap Ultrapack 14-8824 "goods put up in sets for retail sale" within the meaning of GRI 3, HTSUSA?

2) If considered a set, which item(s) provides the essential character for classification under the HTSUSA; if not a set, how are the items properly classified?

3) Are such products eligible for duty free treatment under the Generalized System of Preferences ("GSP"), or, in the alternative, for a duty exemption under subheading 9801.00.10 and/or 9802.00.80, HTSUSA?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is in accordance with the General Rules of Interpretation (GRI), taken in order. GRI 1 provides that the classification shall be determined according to the terms of the headings and any relevant section or chapter notes. Where goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI many be applied, taken in order.

GRI 3 states, in pertinent part:

When by application of Rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be affected as follows:

(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only ... of the items in a

set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.

Since the surgical pack at issue consists of, at least, both paper and plastic articles, which are separately provided for in the Nomenclature, GRI 3(b) applies as follows:

(b) ...goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character.

Explanatory Note X to GRI 3(b) of the HTSUSA, which constitutes the official interpretation of the tariff at the international level, provides, in part:

(X) For the purposes of this Rule, the term "goods put up in sets for retail sale" shall be taken to mean goods which:

(a) consist of at least two different articles which are, prima facie, classifiable in different headings;

(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and

(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or in cases or on boards).

In this case, the items qualify as a set within the meaning of GRI 3. The laparotomy pack consists of at least two different articles which are classifiable in different headings. The set contains articles which are intended for use during a specific surgical procedure. And, although these packs as imported are not "suitable for sale directly to users" due to the fact that they must first be sterilized, sterilization of goods while still in the packages is not considered "constructive unpacking and repacking" so as to disqualify this merchandise as a set. See, HRL 083137 dated October 31, 1989.

Since the laparotomy pack is a set, and classification of its component parts cannot be made pursuant to GRI 3(a), we must determine the essential character of the set in accordance with GRI 3(b).

Explanatory Note VIII to GRI 3(b) states that:

The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.

In this case, the essential character of the Lap Ultrapack 14-8824 is not readily apparent. Each component plays a significant role in the surgical purpose for which the set is designed. No single item imparts a unique character to the function of the set as a whole, and, moreover, none of the factors given above prove determinative in any respect.

When, as in the instant case, the component which gives the goods at issue their essential character cannot be determined, classification is ascertained by utilizing GRI 3(c). GRI 3(c) provides:

When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.

Thus, the competing provisions are as follows: The table cover and mayo stand cover are made of polyethylene plastic, and are classified under subheading 3926.90.9050, HTSUSA, which provides for other articles of plastics and articles of other materials of headings 3901 to 3914: other, other, other.

The hand towels, absorbent towels, utility drapes with tape, and the wing laparotomy sheet with tape are made of paper and as such are classified under subheading 4818.90.0000, HTSUSA, which provides for toilet paper, handkerchiefs, cleansing tissues, towels, tablecloths, table napkins, diapers, tampons, bed sheets and similar household, sanitary or hospital articles, articles of apparel and clothing accessories, of paper pulp, paper, cellulose wadding or webs of cellulose fibers: other.

The suture bag is classified under subheading 4819.40.0040, HTSUSA, which provides for cartons, boxes, cases, bags and other packing containers, of paper, paperboard, cellulose wadding or webs of cellulose fibers; box files, letter trays and similar articles, of paper or paperboard of a kind used in offices, shops or the like: other sacks and bags, including cones, other.

The large scrub nurse gown and sterile back gowns are made of Sontara, which is classified as a textile fabric. See, HRL 086629 dated May 4, 1990 (Customs laboratory analysis confirms that the essential character of Sontara is not imparted by the paper portion of the product; correct classification is under the

provision for woven textile products formed on a base of paper). Classification is therefore appropriate in subheading 6210.10. 2000, HTSUSA, which provides for garments, made up of fabrics of heading 5602, 5603, 5903, 5906 or 5907: of fabrics of heading 5602 or 5603: of fabrics formed on a base of paper or covered or lined with paper.

Applying GRI 3(c), the Lap Ultrapack 14-8824 is classified under heading 6210, HTSUSA, which appears last in numerical order among the competing headings which equally merit consideration.

Certain articles from Mexico are eligible for special tariff treatment under the Generalized System of Preferences (GSP) pursuant to section 502(a)(3) of the Trade Act of 1974. However, General Note 3(c)(ii)(C) of the HTSUSA states that:

The symbol "A*" indicates that certain beneficiary developing countries, specifically enumerated in subdivision (c)(ii)(D) of this note, are not eligible for such preferential treatment with regard to any article provided for in the designated provision.

Subdivision (c)(ii)(D) includes all articles produced in Mexico which are classified under subheading 6210.10.20, HTSUSA. Therefore, duty-free treatment of the Lap Ultrapack 14-8824 under GSP is denied.

In the alternative, HTSUSA subheading 9802.00.80, which provides a partial duty exemption for the following, is considered:

[a]rticles assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process such as cleaning, lubrication, and painting...

All three requirements of HTSUSA 9802.00.80 must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to duty upon the full value of the imported assembled article, less the cost or value of such U.S. components, upon compliance with the documentary requirements of section 10.24, Customs Regulations (19 C.F.R. 10.24).

Section 10.16(a), Customs Regulations (19 C.F.R. 10.16(a)), provides that the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners.

The sewing of the pre-cut Sontara fabric into gowns, and the gluing of the various wing laparotomy sheet parts and tape, are considered acceptable assembly operations pursuant to 19 C.F.R. 10.16(a). Therefore, the surgical pack at issue is entitled to an allowance in duty for the cost or value of the U.S. components incorporated into the two large Sontara gowns and the wing laparotomy sheet with tape under HTSUSA subheading 9802.00.80 when imported into the U.S. in the Lap Ultrapack 14-8824.

HTSUS subheading 9801.00.10 provides for the free entry of U.S. products that are exported and returned without having been advanced in value or improved in condition by any means while abroad, provided the documentary requirements of section 10.1, Customs Regulations (19 C.F.R. 10.1), are met. In Superscope, Inc. v. United States, 13 CIT , 727 F.Supp. 629 (CIT 1989), the court found that glass panels of U.S. manufacture that were exported, packaged with other components to make unassembled stereo cabinets, and then imported into the U.S. as an entirety were not advanced in value or improved in condition while abroad, but were merely repacked. Therefore, the court held that the glass panels were entitled to duty free entry under item 800.00, Tariff Schedules of the United States (TSUS) (the precursor provision to HTSUSA subheading 9801.00.10).

With the exception of the Sontara gowns and the wing laparotomy sheet with tape, the operations performed in Mexico consist merely of repackaging the U.S. products with the assembled Sontara garments and the wing laparotomy sheet. Therefore, as the mere packaging of U.S. products with other products does not advance in value or improve in condition the U.S. products, the portion of the surgical pack consisting of U.S. products, excluding the assembled Sontara gowns and wing laparotomy sheet with tape, will be eligible for the duty exemption under HTSUS subheading 9801.00.10. This assumes that the documentation requirements of 19 C.F.R. 10.1 are met and that the district director of Customs at the port of entry is satisfied of the U.S. origin of each product claimed to be entitled to this duty exemption.

HOLDING:

The merchandise at issue, Lap Ultrapack 14-8824, is a set, and as such is classified in accordance with GRI 3(c) under subheading 6210.10.2000, HTSUSA, which provides for garments,

made up of fabrics of heading 5602, 5603, 5903, 5906 or 5907: of fabrics of heading 5602 or 5603: of fabrics formed on a base of paper or covered or lined with paper, dutiable at a rate of 5.6 percent ad valorem.

On the basis of the information and samples provided, it is our opinion that an allowance in duty may be made under the HTSUS subheading 9802.00.80 for the cost or value of the U.S. components incorporated into the large Sontara gowns and wing laparotomy sheet when the assembled articles are returned to the U.S., upon compliance with the documentary requirements of 19 C.F.R. 10.24. Moreover, the packaging operations do not advance in value or improve in condition the other U.S. products. Therefore, the other U.S. products will qualify for the duty exemption under HTSUS subheading 9801.00.10, upon compliance with the documentation requirements of 19 C.F.R. 10.1.

Due to the changeable nature of the statistical annotation (the ninth and tenth digits of the classification) and the restraint (quota/visa) categories, you should contact your local Customs office prior to importation of this merchandise to determine the current status of any import restraints or requirements.

Sincerely,

John Durant, Director
Commercial Rulings Division