CLA-2-61:OT:RR:NC:N3:356
Ms. Rachael Goding
International Automated Brokers, Inc.
1655 St. Andrew’s Cove
San Diego, CA 92154
RE: The tariff classification and eligibility under subheading 9802.00.50, HTSUS, for men’s and women’s knit garments.
Dear Ms. Goding:
In your letter dated August 5, 2013, you requested a ruling on behalf of Aquasea, Inc., concerning the eligibility under subheading 9802.00.50, HTSUS, for certain men’s and women’s knit garments that will imported into the United States.
You state that Aquasea, Inc., will purchase men’s or women’s T-shirt “blanks” in the United States. “Blanks” are finished garments that are acceptable, as is, for retail sale. The blanks, which have a fiber content of either 50% cotton, 50% polyester or 100% cotton, are exported to Mexico to undergo various printing and embellishing operations. You state that the operations performed in Mexico will involve any of the following printing techniques: silk-screen, heat transfer, sublimation printing, flocking, puff printing, foil printing and/or embellishing with embroidery or rhinestone appliques. The garments will then be relabeled as required, tagged, and packaged before return to the United States.
You state that, upon return to the United States, Aquasea will import the garments under heading 6110, HTSUS, with the appropriate HTSUS number according to the fiber content, sex and age of the intended wearer of the garment along with classification under 9802.00.5060, HTSUS. We are unable to determine whether the garments are properly classifiable under heading 6109, as men’s or women’s T-shirts and similar garments, or under heading 6110, as men’s or women’s pullovers, without a sample of the garment with each of the printing or embellishing techniques applied.
Subheading 9802.00.50, HTSUS, provides a partial or complete duty exemption for articles exported from and returned to the United States after having been advanced in value or improved in condition by repairs or alterations, provided that the documentary requirements of Section 181.64, Customs Regulations (19 C.F.R. § 181.64), are satisfied.
19 C.F.R. § 181.64 (a) states that “repairs or alterations” means restoration, addition, renovation, redyeing, cleaning, resterilizing, or other treatment which does not destroy the essential characteristics of, or create a new and commercially different good from, the good exported from the United States. However, entitlement to this tariff treatment is precluded in circumstances where the operations performed abroad destroy the identity of the exported articles or create new or commercially different articles through a process of manufacture.
Subheading 9802.00.50, HTSUS, treatment is also precluded where the exported articles are incomplete for their intended use and the foreign processing operation is a necessary step in the preparation or manufacture of finished articles. Furthermore, the merchandise must be in compliance with the pertinent legal notes of the HTSUS. For example, Section XXII, Chapter 98, Subchapter II, U.S. Note 1(b) states that heading 9802 HTSUS shall not apply to any article exported with benefit of drawback (other than NAFTA drawback).
In this instance, the garments are complete for their intended use prior to being exported to Mexico to undergo the stated operations. As exported from the United States, the garments are finished products in that they are suitable for use as wearing apparel. Although the operations performed in Mexico alter the appearance of the garments, such operations do not otherwise enhance the character of the garments. They are shipped to Mexico solely for printing and embellishment before being returned to the United States.
The merchandise in its condition as exported from the United States and as returned from Mexico can be marketed and sold to consumers for the same use. The operations performed in Mexico do not result in the loss of the good’s identity nor create a new article with a different commercial use. Therefore, the operations performed in Mexico constitute acceptable repairs and alterations within the meaning of subheading 9802.00.50, HTSUS. The garments will qualify for the special tariff treatment of that provision, provided that the documentary requirements of 19 C.F.R. § 181.64 are met.
You also provide information regarding the documentation that will be presented to substantiate your claim for eligibility under 9802.00.50, HTSUS, and request a ruling regarding the acceptability of these documents. Section 181.64 (c ) indicates that the documentation required for acceptance of claims under this provision are at the discretion of the port director. We suggest that you contact the port director at the involved port of entry regarding the acceptability of the proposed documentation.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of this ruling letter 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 this ruling, contact National Import Specialist Mary Ryan at 646-733-3271.
Sincerely,
Myles B. Harmon
Acting Director
National Commodity Specialist Division