CLA-2:CO:R:C:G 082330 JAS
John R. Pope
William M. Orr Company, Inc.
2600 Freedland Road
West Middlesex, Pennsylvania 16159
RE: Classification and Duty Drawback on Stainless Steel Sheet
in Coils
Dear Mr. Pope:
In your letter of May 18, 1988, you inquire as to the
tariff classification and applicability for duty drawback of
stainless steel sheet in coil.
FACTS:
Stainless steel sheet in coil form, from the U.K., Mexico
or Canada, is the subject of this inquiry. You informed us by
telephone that the merchandise is a cold rolled stainless
product imported in 36, 42, 48, and 60 in. widths. It has a
maximum thickness of 0.135 in. and a minimum thickness of 0.015
in. This merchandise will be exported from Canada to your
facility where it will be uncoiled, leveled or flattened, and
cut to sheet metal lengths of 120 in. to 144 in. or more.
Alternatively, the product will be uncoiled and slit to smaller
widths, then re-coiled. In both cases, the merchandise will be
exported to Canada after processing and warehoused for eventual
sale to end users.
ISSUE(S):
Is the imported merchandise classifiable as a basic shape
or form of iron or steel? Is it eligible for duty drawback,
or may it enter free of duty under bond?
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LAW AND ANALYSIS:
For tariff purposes, sheets are flat rolled products
whether or not corrugated or crimped, in coils or cut to
length, under 0.1875 inch in thickness and over 12 inches in
width. Note the definition of Plates and sheets in Schedule 6,
Part 2, Subpart B, Headnote 3(g), Tariff Schedules of the
United States (TSUS).
In its condition as imported, the merchandise in question
is classifiable under the provision for plates and sheets of
stainless steel, pickled or cold rolled, in item 607.9020,
Tariff Schedules of the United States Annotated (TSUSA),
dutiable at the rate of 10 percent ad valorem, plus additional
cumulative duties on the alloying elements, by weight, speci-
fied in Schedule 6, Part 2, Subpart B, Headnote 4, TSUS.
There is insufficient information to issue a binding
ruling on whether the cutting or slitting operations would
qualify the product for drawback. It is unlikely that the cut
or slit steel could be considered to be in the same condition
as imported because cutting and slitting are beyond the
incidental operations allowable under 19 U.S.C. 1313(j).
While the cutting and slitting change the condition of the
steel, neither operation appears to be a manufacture or
production, as required for eligibility for manufacturing
drawback under 19 U.S.C. 1313(a). In order to be a manufacture
or production for drawback purposes, a new article must result,
one having a new name, use, or characteristic.
However, articles to be repaired, altered, or processed
(including processes which result in articles manufactured in
the United States), may be eligible for duty-free entry under
bond, in item 864.05, TSUS, upon compliance with applicable
headnotes in Schedule 8, Part 5, Subpart C, TSUS.
HOLDING:
The stainless steel sheets in coil are classifiable in
item 607.9020, TSUSA, as indicated.
The Harmonized Tariff Schedule of the United States
Annotated (HTSUSA), is scheduled to replace the TSUS as the
tariff code of the United States on January 1, 1989. The
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HTSUSA provision applicable to stainless steel sheets in coil
form is Flat-rolled products of stainless steel, not further
worked than cold-rolled, in subheading 7219.32.0010 if of a
thickness of 3 mm or more but less than 4.75 mm; in subheading
7219.33.0010 if of a thickness exceeding 1 mm but less than 3
mm; or in subheading 7219.34.0010 if of a thickness of 0.5 mm
or more but not exceeding 1 mm. Merchandise classifiable in
these subheadings may be subject to an additional duty under
subheading 9903.72.00. This represents Customs current
position on the classification of this merchandise. However,
if there are changes in these provisions prior to the date the
HTSUSA becomes effective, this advice may not continue to
apply.
Merchandise from Mexico and the U.K. classifiable in item
607.9020, TSUSA, may be covered by steel arrangements the
United States has with those countries. We are referring a
copy of your letter, and this response, to the International
Trade Administration, Import Administration, Office of Agree-
ments Compliance, Department of Commerce, Washington, D.C.
20230. That office will correspond directly with you in this
regard.
The stainless steel sheets in coil may be eligible for
entry free of duty under bond, in item 864.05, TSUS, upon
compliance with the applicable headnotes. If this merchandise
is covered by a steel arrangement, an export certificate will
be required at the time of entry. The described processing
operations in the United States will not result in a substan-
tial transformation of the imported merchandise. Therefore,
assuming the requirements for entry under item 864.05 are met,
upon satisfactory proof of exportation to Canada you may apply
to have the quantity exported recredited to your allocation
under the particular steel arrangement. The Office of Agree-
ments Compliance will provide more information on this pro-
cedure.
We are enclosing for your reference materials on Customs
drawback and temporary importation under bond (T.I.B.)
procedures, as well as copies of all cited provisions.
Sincerely,
John Durant, Director
Commercial Rulings Division
Enclosures