CLA-2 CO:R:C:V 544243 EK
Cecilia Castellanos
Edward S. Zerwekh Company
P.O. Box 368
Wilmington, California 90748
RE: Request for Ruling
Dear Ms. Castellanos:
This is in response to your letter of September 6, 1988,
requesting a ruling as to the proper valuation of merchandise
imported by your client.
FACTS:
You state that the merchandise in question will be entered
under the Generalized System of Preferences (GSP). You are not
inquiring and this letter will not address the GSP eligibility
requirements and whether they are met in the instant situation.
You indicate that there may be assists involved with the
importation and you are inquiring as the proper declaration
and valuation of the assists. Since your letter does not
disclose specific details regarding the nature of the assists,
then this letter is to be treated as an "information letter"
pursuant to section 177.1(d)(2) of the Customs Regulations,
19 CFR 177.1(d)(2).
ISSUE:
What is the proper method of declaring the assists and how
will their value be determined?
LAW AND ANALYSIS:
With respect to declaration of the assist, section
152.103(e)(1) of the Customs Regulations allows for the
apportionment of the value of assists to imported merchandise to
be made in a reasonable manner appropriate to the circumstances
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and in accordance with generally accepted accounting principles.
The regulation further provides that if the entire anticipated
production using the assist is for exportation to the United
States, then the total value may be apportioned over the first
shipment. Duty is then paid on the entire value at once.
Regarding the value of the assist, section 152.103(d)(1)
and (2) of the Customs regulations states that, depending upon
the type of assist, the value is either the cost of its
acquisition or the cost of its production. In either case, the
value of the assist includes transportation costs to the place of
production.
Please note that it is possible to depreciate an assist to
a zero value. In Headquarters Ruling No. 543233 CW dated August
9, 1984, the books and records of the importer reflected a zero
value for a mold in accordance with generally accepted accounting
principles. In that case, we held that the value of the assist
was limited to the costs and expenses incurred in transporting
the assist to the place of production.
HOLDING:
Therefore, if in accordance with generally accepted
accounting principles, the value of the assist which you are
providing to the seller has been fully depreciated according to
your records, then the value of the assist will be equal to the
cost of transporting the assist to the place of production.
Sincerely,
John Durant, Director,
Commercial Rulings Division