ENT-1-03/ENT-5-01/QUO-1-RR:IT:EC 114067 CC

Port Director of Customs
9 North Grand Avenue
Nogales, Arizona 85621

RE: Revocation of HQ 225410; Date of Entry; 19 CFR  141.68; Tariff Rate Quota

Dear Sir or Madam:

Headquarters Ruling (HQ) 225410, dated September 20, 1994, was issued in response to your request for advice concerning the date of entry for produce released prior to the opening of a quota period. You used as an example the importation of eggplant in your port. We found in that decision that when the merchandise was released in a time period when it was not under any quota restrictions, and entry summary is subsequently filed when the merchandise is subject to a tariff rate quota, the date of entry is the date that the entry summary was filed in proper form, with estimated duties attached (unless ABI procedures are used). Therefore, the eggplant was found to be subject to quota. We have reviewed HQ 225410 and believe it is incorrect.

Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub.L. 103-182, 107 Stat. 2057), notice of the proposed revocation of HQ 225410 was published on October 8, 1997, in the CUSTOMS BULLETIN, Volume 31, Number 41.

FACTS:

It was stated in your request that on the Mexican /United States border all produce is normally released under the immediate delivery procedures. Before implementation of NAFTA, when a vegetable or fruit changed from a lower duty rate to a higher duty rate, the broker would request that for a week to 10 days before the change, the particular product be released under the entry procedures in 19 CFR  141.68(a).

The general rate of duty for eggplant was increased on April 1, 1994, but under NAFTA eggplant also went from a non-quota to a tariff rate quota (citing subheadings 0709.30.4000, 0709.30.2000, 9906.07.35, and 9906.07.36, Harmonized Tariff Schedule of the United States (HTSUS)). You stated that all eggplant entered after April 1 is considered to be subject to a tariff rate quota and reported as such but, since the quota is not an absolute one, eggplant may be released through an immediate delivery or entry procedures in 19 CFR  141.68(a).

In the middle of March, in anticipation of the April change in duty, some brokers in your (then) district asked that for the last week in March all of their eggplant releases be released under 19 CFR  141.68(a). Eggplant subject to such requests was released in March, and the broker filed the entry summary in April with a March date of entry and a free rate of duty.

ISSUE:

When merchandise is released without filing the entry summary, pursuant to 19 CFR  141.68(a), in a time period when the merchandise is not under any quota restrictions, but the entry summary is subsequently filed when the merchandise is subject to a tariff rate quota, what is the date of entry.

LAW AND ANALYSIS:

The effective rates of duty for merchandise imported into the United States are provided for in 19 U.S.C.  1315. That statute, as amended, provides, in pertinent part, the following:

(a) Except as otherwise specially provided for, the rate or rates of duty imposed by or pursuant to this chapter or any other law on any article entered for consumption or withdrawn from warehouse for consumption shall be the rate or rates in effect when the documents comprising the entry for consumption or withdrawal from warehouse for consumption and any estimated or liquidated duties then required to be paid have been deposited with the Customs Service by written, electronic or such other means as the Secretary by regulation shall prescribe, except that-- (1) ... (2) ... (3) any article for which duties may, under section 1505 of this title, be paid at a time later than the time of making entry shall be subject to the rate or rates in effect at the time of entry. 19 U.S.C.  1505(a) provides, in pertinent part, "[u]nless merchandise is entered for warehouse or transportation, or under bond, the importer of record shall deposit with the Customs Service at the time of making entry or at such later time as the Secretary may prescribe by regulation, the amount of duties and fees estimated to be payable thereon....

Customs Regulations issued pursuant to, or that are relevant to, the above statutes, are set forth, in part, below. 19 CFR  141.69 provides, "[t]he rates of duty applicable to merchandise shall be the rates in effect at the time of entry, as specified in  141.68, except [in cases not pertinent in this case]..."

As stated in HQ 225410, 19 CFR  141.68 provides the time of entry for merchandise imported into the United States. Subsection (a) of section 141.68 provides the general rule for establishing the time of entry when entry documentation is filed without an entry summary, and subsection (b) of section 141.68 provides the rule for establishing the time of entry when an entry summary serves as both the entry documentation and entry summary. Subsection (c) specifically provides for merchandise released under the immediate delivery procedure (the time of entry is the time the entry summary is filed in proper form, with estimated duties attached). Subsection (d) specifically provides for the time of entry for quota-class merchandise (i.e., "[t]he time of entry for quota-class merchandise shall be the time of presentation of the entry summary or withdrawal for consumption in proper form, with estimated duties attached or, if the entry/entry summary information and a valid scheduled statement date... have been successfully received by Customs via [ABI], without estimated duties attached, as provided in [19 CFR  132.11a]").

19 CFR  142.12 provides the following:

(b) If the importer is not required to file the entry summary documentation at the time of entry under the provisions of  142.13, or if he does not elect to do so, the entry summary documentation shall be filed, with estimated duties attached, within 10 working days after the time of entry. In HQ 225410 we stated, "[i]n interpreting these provisions, we are guided by the rule of interpretation that a general rule will not be held to apply to a matter specifically dealt with in another part of the same provision." We found that because 141.68(d) specifically applies to the date of entry for quota-class merchandise, it applied to the factual situation presented. Consequently, we concluded that in application of  141.68(d), the date of entry for the eggplant was the date of presentation: the date entry summary was filed with estimated duties attached (unless ABI procedures are used).

After reconsideration of that decision, we believe it is incorrect. Section 141.68(d) equates the date of entry for quota-class merchandise as the time of presentation. Presentation is only applicable to quota-class merchandise. The time of presentation is the delivery to Customs in proper form of the entry summary with estimated duties attached (unless ABI procedures are used). The time of presentation is important because it determines quota-status, and becomes particularly important when a quota becomes nearly filled.

Thus, 19 CFR  141.68(d) applies only to quota class merchandise and serves to reiterate what the time of presentation is for quota-class merchandise. To determine that 141.68(d) applies, it must first be determined that the merchandise in question is subject to quota. To determine whether merchandise is subject to quota, it must be determined what is the date of entry for the merchandise, and what quota restraints apply at that time.

As stated above, 19 CFR  141.68(a) applies to a situation in which entry documentation is filed without entry summary. Depending on the particular situation, 19 CFR  141.68(a) provides the date of entry is the time (1) Customs authorizes release of the merchandise, (2) the entry documentation is filed, or (3) the time the merchandise arrives in the port limits. Entry summary, with estimated duties attached, is required to be filed within 10 working days of the date of entry. Absent any applicable law or regulation that states the date of entry is the date the entry summary is filed for a class of merchandise that becomes subject to quota after it is released with entry documentation having been filed, and the date of entry is prior to the opening of the quota period pursuant to 19 CFR  141.68(a), then 19 CFR  141.68(a) must apply. In this situation, section 141.68(d) does not apply because the merchandise is not considered quota-class merchandise.

Consequently, for the example of the importation of eggplant, the date of entry would be in March when the entry documentation was filed and the eggplant was released, pursuant to section 141.68(a). The date the entry summary was filed, in April, would not serve as the date of entry. Thus, the eggplants should not have been subject to quota since that class of merchandise did not have any quota constraints until April 1. Since duties are determined on the date of entry, the applicable subheadings would be those that applied to the eggplant in March.

HOLDING:

When merchandise is released without filing the entry summary, pursuant to 19 CFR  141.68(a), in a time period when the merchandise is not under any quota restrictions, but the entry summary is subsequently filed when the merchandise is subject to a tariff rate quota, the date of entry is not when the entry summary is filed, but the date of entry provided by 19 CFR  141.68(a). The merchandise would not be subject to quota, and the dutiable rate would be that applicable at the date of entry as provided by 19 CFR  141.68(a).

HQ 225410 is revoked.

In accordance with 19 U.S.C. 1625(c)(1), this ruling will become effective 60 days after its publication in the CUSTOMS BULLETIN. Publication of rulings or decisions pursuant to 19 U.S.C. 1625(c)(1) does not constitute a change of practice or position in accordance with section 177.10(c)(1) of the Customs Regulations (19 CFR 177.10(c)(1)).

Sincerely,


Acting Director,
International Trade Compliance Division