CON-9-04-CO:R:C:E 223640 CB
Mr. Eric Jones
Eric Jones Customs Brokerage
5777 W. Century Boulevard
Suite 380
Los Angeles, CA 90045
RE: Temporary Importation under Bond; HTS 9813.00.05;
Fabric Imported and Processed
Dear Mr. Jones:
This is in response to your request for a binding ruling
dated December 2, 1991 on behalf of Embroidertex West Ltd.
(Embroidertex) which you addressed to the Customs Information
Exchange in New York. Your request was forwarded to our office
for a reply.
FACTS:
Embroidertex intends to import woven fabric into the United
States from India. After importation the fabric will be
processed by using a Schiffli embroidery machine to embroider a
design. By using an elasticized yarn as a bobbin yarn, the
fabric puckers and a unique fabric construction is produced.
You have described the imported fabric as a rayon printed
georgette. However, our analysis indicates that it is composed
of 100% filament acetate which has been dyed a single uniform
color and has been woven with a satin weave.
ISSUE:
Whether the imported product and the processing it undergoes
in the United States qualify for temporary importation under HTS
9813.00.05?
LAW AND ANALSYIS:
All merchandise imported into the United States is subject
to duty unless specifically exempted therefrom. Subheading
9813.00.05, HTSUS, provides for duty-free entry, under bond, for
merchandise imported into the United States for a temporary
period for the purpose of repair, alteration, or processing. The
latter may include processing that transforms an article into one -2-
that is considered manufactured or produced in the United States.
The provision requires that the imported merchandise be exported
or destroyed within one year of the date of importation. This
period may be extended for one or more periods which, when added
to the initial one year, do not exceed a total of three years.
In order to qualify for this duty-free treatment, merchandise
cannot be imported for the purpose of sale (or sale on approval).
Textiles are permitted duty-free treatment under subheading
9813.00.05, HTSUS, if they are not subject to quota and visa
restrictions. Entry under this provision would not be precluded
if the textiles are subject to a quota and the quota is not
filled. However, the merchandise would be charged against the
quota, since TIB entries are considered consumption entries for
purposes of administering quotas.
You state that the woven fabric is imported with a textile
visa from India. Once the product is in the United States it is
processed by using a Schiffli embroidery machine to embroider an
elasticized design. From the description of the operation given,
all indications are that a process takes place. Thus,
the embroidery procedure falls within subheading 9813.00.05,
HTSUS. It is our opinion that the embroidery creates a new and
different article of commerce resulting in an article produced or
manufactured in the United States. Therefore, you must meet all
of the accountability requirements under the U.S. Notes of
Subchapter XIII, HTSUS. In particular, subheading 9813.00.05,
HTS, U.S. Note 2(b) states that if any processing of such
merchandise results in an article manufactured or produced in the
United States: (i) a complete accounting will be made to the
Customs Service for all articles, wastes and irrecoverable losses
resulting from such processing; and (ii) all articles and
valuable wastes resulting from such processing will be exported
or destroyed under Customs supervision within the bonded period;
except that in lieu of the exportation or destruction of valuable
wastes, duties may be tendered on such wastes at rates of duties
in effect for such wastes at the time of importation.
The applicable Customs regulations may be found at 19 CFR
10.31 through 10.40. Section 10.31(f) states that a bond shall
be given on Customs Form 301 in an amount equal to double the
duties which it is estimated would accrue (or such larger amount
as the district director shall state in writing to the entrant is
necessary to protect the revenue) had all the articles covered by
the entry been entered under an ordinary consumption entry. The
basis for the computation of the amount of a temporary
importation bond is estimated duties determined in accordance
with sections 141.90 and 141.103 of the Customs Regulations (19
CFR 141.90 and 19 CFR 141.103). To this amount is added any -3-
other duties that the district director ascertains may become due
on the articles so entered and, as well, estimated expenses of
reimbursable supervision such as may arise, for instance, when
the articles are not properly marked.
The Chief, National Import Specialist Branch 3, at the New
York Seaport has indicated that the fabric is classifiable in
subheading 5408.22.00, HTSUS, which provides for woven fabrics of
artificial filament yarn, including woven fabrics obtained from
the materials of heading 5405, other woven fabrics, containing 85
percent or more by weight of artificial filament or strip or the
like, dyed. The textile category for this subheading is 618.
HOLDING:
Entry is permitted in this case under a temporary
importation under bond as a process under subheading 9813.00.05,
HTSUS. The importer must meet all of the accountability
requirements under the U.S. Notes of Subchapter XIII to the
satisfaction of the District Director.
The subject merchandise is classifiable in subheading
5408.22.00 HTSUS, which provides for woven fabrics of artificial
filament yarn, including woven fabrics obtained from the
materials of heading 5405, other woven fabrics, containing 85
percent or more by weight of artificial filament or strip or the
like, dyed. The rate of duty is 17% ad valorem and the textile
category is 618.
Sincerely,
John A. Durant, Director
Commercial Rulings Division
cc: New York Seaport