HQ 115779
August 29,2002
ENT-4-02-RR:IT:EC 115779 GG
Joel K. Simon, Esq.
Serko & Simon LLP
Customs and International Trade Law
1700 Broadway, 31st Floor
New York, NY 10019
RE: Administrative exemption; 19 U.S.C. §1321(a)(2)(C); 19 CFR §§10.151 and 10.153; textiles; Internet sales
Dear Mr. Simon:
This is in response to your ruling request, dated August 13, 2002, made on behalf of your client, GDN Limited T/A Figleaves.com (“Figleaves.com”), of London, England, concerning the importation of low-value shipments of textile articles.
FACTS:
Figleaves.com sells lingerie, items of intimate apparel, hosiery and swimwear for women and men, as appropriate, over the Internet from its web site. In the future it may expand its product line to include other items of apparel, such as shirts and active wear. Customers in the United States place orders for their personal use by accessing the web site. The payments, which are made by credit card, include any applicable shipping charges. Upon being placed, the orders are packaged from inventory and shipped directly to the customers via Federal Express or other express consignment carrier. Almost all of the shipments will be valued at under $200.00 per shipment. No more than one order of merchandise per individual customer will be shipped on any given day.
ISSUE:
Whether the textile items in question are entitled to duty-free informal entry under section 321(a)(2)(C) of the Tariff Act of 1930, as amended (19 U.S.C. 1321(a)(2)(C)), and are exempt from quota and visa requirements?
LAW AND ANALYSIS:
Section 321(a)(2)(C) of the Tariff Act of 1930, as amended (19 U.S.C. §1321(a)(2)(C)), provides for the duty free entry of articles valued at $200 or less which are imported by one person on one day. The purpose of this provision is to minimize expense and inconvenience to the government disproportionate to the revenue that is collected. The applicable regulations for express consignment shipments of this nature are found in sections 10.151, 10.153, 128.24(e), and 143.23(j) of the Customs Regulations (19 CFR §§10.151, 10.153, 128.24(e) and 143.23(j)).
Section 10.151 of the Customs Regulations permits shipments valued at $200 or under to be entered free of duty and tax, unless there is reason to believe that the shipment is one of several lots covered by a single order or contract and that it was sent separately for the express purpose of securing free entry or of avoiding compliance with any pertinent law or regulation. As a general rule, the exemption is not allowed in the case of any merchandise of a class or kind which is subject to an absolute or tariff-rate quota, whether the quota is open or closed. (19 CFR §10.153(g)). However, an exception to this general rule exists in the case of textile and textile products imported for the noncommercial, personal use of the individual importing the merchandise. See Headquarters Ruling Letter (HQ) 226254, dated November 3, 1995 and HQ 114453, dated October 21, 1998.
You indicate that most of the shipments sold by Figleaves.com will contain merchandise that is valued at $200 or less and is for the personal use of the customer. Each shipment will be ordered by and sent directly to the individual purchaser. Provided that a shipment does not exceed $200 and is not one of several increments of a single order sent separately to avoid payment of duty, and that the importer claims the Section 321 exemption only once a day, the administrative exemption from duty will apply. In addition, the shipments will not be subject to quota or visa constraints and may be entered under the simplified informal entry procedures described in sections 128.24(e) and 143.23(j) of the Customs Regulations. Shipments exceeding the $200 limit will not be eligible for the exemption.
HOLDING:
A shipment of textile articles valued at $200 or less imported by one person on one day may be entered free of duty under the administrative exemption of 19 U.S.C. §1321(a)(2)(C), provided the shipment is not one of several increments of a single order sent separately to avoid the payment of duty, and the importer claims the exemption only once a day. The merchandise in question will not be subject to quota or visa requirements if it is being imported for the personal, noncommercial use of the importer.
Sincerely,
Glen E. Vereb
Acting Chief
Entry Procedures and Carriers Branch