CLA-2-81:RR:NC:1:118 C81626
Mr. Steven J. Strulowitz
President
Sovereign Recycling International
P.O. Box 10308
Bettendorf, IA 52722
RE: The tariff classification of tungsten (wolfram) powder and unwrought tungsten rods and bars from Uzbekistan.
Dear Mr. Strulowitz:
In your letter dated October 31, 1997, you requested a tariff classification ruling.
You state your products, tungsten powder and unwrought tungsten bars and rods, are composed of 99.8% tungsten. This material will be purchased from the UZKTZ HM plant in Uzbekistan by a metal broker in the United Kingdom. This metal broker will then sell this material to you prior to the shipment leaving Uzbekistan. The material will be shipped from the Uzbekistan plant by truck to a European port for shipment to a Custom Bonded warehouse in the United Kingdom. The tungsten will be unloaded at this warehouse where it will be inspected and repackaged for shipment to the United States.
Under the Generalized System of Preference (GSP), eligible articles which are imported directly from a designated beneficiary developing country (BDC) into the U.S. qualify for duty-free treatment if the sum of the cost or value of the constituent materials produced in the BDC plus the direct costs involved in processing the eligible article in the BDC is at least 35 percent of the article's appraised value at the time it is entered into the U.S. The phrase "imported directly" is defined in section 10.175 of the Customs Regulations (19 CFR 10.175).
Under 19 CFR 10.175, merchandise shipped through a non-BDC to the U.S. is "imported directly" if: 1) the merchandise does not enter into the commerce of the intermediate country while en route to the U.S., and the invoices, bills of lading and other shipping documents show the U.S. as the final destination (19 CFR 10.175(b)); or 2) the merchandise does not enter into the commerce of the intermediate country except for the purpose of sale other than at retail, the shipment remains under the control of the customs authority of the intermediate country and the shipment is not subjected to operations other than loading and unloading and other activities necessary to preserve the articles in good condition (19 CFR 10.175(d)).
The shipment described in your letter does not appear to meet the requirements of either subsection. Manipulation of the merchandise permitted in the non-BDC under 19 CFR 10.175(d) is limited to "loading and unloading, and other activities necessary to preserve the articles in good condition." 19 CFR 10.175(d)(3). Testing and repackaging constitutes more than a loading and unloading operation. Accordingly, the imported products, although they may be produced in Uzbekistan, will not qualify for GSP eligibility because they do not meet the "imported directly" requirement.
The applicable subheading for the tungsten powder produced in Uzbekistan will be 8101.10.0000, Harmonized Tariff Schedule of the United States (HTS), which provides for Tungsten (wolfram) and articles thereof, including waste and scrap: Powders. The rate of duty will be 8.4 percent ad valorem. The applicable subheading for the unwrought tungsten bars and rods will be 8101.91.5000, HTS, which provides for Tungsten (wolfram) and articles thereof, including waste and scrap: Other: Unwrought tungsten, including bars and rods obtained simply by sintering; Waste and scrap: Unwrought. The rate of duty will be 3.4 percent ad valorem.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR 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 Kathy Campanelli at 212-466-5492.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division