CON-9-04-CO:R:C:E 224687 JRS
Mr. George Cigarroa
Cigarroa Dispatch
518 E. Matamoros
Laredo, Texas 78042
RE: Subheading 9813.00.05, HTSUS
Dear Mr. Cigarroa:
This is in response to your letter dated April 30, 1993,
requesting a ruling on the eligibility of the following procedure
to qualify for free importation under bond. Our ruling follows.
FACTS:
Joan Fabrics Corporation, a U.S. corporation, desires to
import temporarily, free under bond, polypropylene yarn to be
woven into fabric for furniture under subheading 9813.00.05,
Harmonized Tariff Schedule of the United States (HTSUS), and then
export the resulting article back to the exporter, Industrias
Polifil, in Mexico.
The description of the process in the United States is
briefly summarized as follows. The imported 100% polypropylene
continuous filament yarn is woven (warp and weft) into a jacquard
fabric for furniture (which has 40 yarns per inch and 11 picks
per inch) and is finished with backing and needle punched. You
do not state whether any waste occurs during this operation.
ISSUE:
Whether the above-described operation qualifies as a process
for purposes of temporary duty-free treatment under subheading
9813.00.05, HTSUS.
LAW AND ANALYSIS:
Subheading 9813.00.05, HTSUS, provides for the importation
into the United States temporarily free of duty under bond (TIB),
of articles to be repaired, altered or processed, including
processes which result in articles manufactured or produced in
the United States.
If merchandise entered under a TIB results in articles
produced or manufactured in the United States, a complete
accounting of all articles, wastes (i.e., scrap fabric) and
recoverable losses must be made to the Customs Service. U.S.
Note 2(b), Chapter 98, Subchapter XIII, HTSUS. Exportation of
the articles and valuable wastes must take place within the bond
period under Customs supervision. U.S. Note 1(a) to Chapter 98,
Subchapter XIII, HTSUS, provides in part that merchandise
imported under TIB procedures may not be imported for sale or
sale on approval. Further, U.S. Note 1(a) allows the initial TIB
period, one year from the date of importation, to be extended,
upon application to the district director, for one or more
further periods which, when added to the initial one year, shall
not exceed a total of three years. See 19 CFR 10.37.
We have held, for purposes of our drawback statute (19
U.S.C. 1313), that the use of yarn to make upholstery fabric
produces a new and different article satisfying the requirement
of a manufacture or production. See 212899 WR, dated April 28,
1981, abstracted as T.D. 81-190-U. Processes under a TIB are
given a more liberal construction than what is permitted under
our drawback statute. It is our opinion, therefore, that the
weaving of the yarn is clearly a process within the meaning of
subheading 9813.00.05, HTSUS.
Please note that the imported yarn may be subject to visa
requirements as well as quota. Any merchandise subject to a
quota which has been filled cannot be released under a temporary
importation bond. See T.D. 54802(53) and (54)(Copies enclosed
for your information). If the quota is open, the merchandise may
be entered under TIB procedures, but there will be a charge
against the quota.
Merchandise entered in the United States under any item in
Chapter 98 of the HTSUS, except subheading 9802.00.60 or
9802.00.80, is exempt from the merchandise processing fee of 0.17
percent ad valorem, see 19 U.S.C. 58c(a)(9)(A).
HOLDING:
Based on the information provided, the weaving of imported
yarn into upholstery fabric qualifies as a process under
subheading 9813.00.05, HTSUS, for temporary admission into the
United States, under bond, without the payment of duty.
Sincerely,
John Durant, Director
Commercial Rulings Division