CLA-2 CO:R:C:V 555685 KAC
Sandra L. Friedman, Esq.
Barnes, Richardson & Colburn
475 Park Avenue South
New York, New York 10016
RE: Applicability of duty exemption available under HTSUS
subheading 9801.00.10 to infant formulas packaged
abroad.Packaging;John V. Carr;C.S.D. 79-184;555624
Dear Ms. Friedman:
This is in response to your letter dated June 27, 1990, on
behalf of Bristol-Myers Company, requesting a ruling concerning
the applicability of subheading 9801.00.10, Harmonized Tariff
Schedule of the United States (HTSUS), to infant formulas
imported from Canada. Samples were submitted for examination.
FACTS:
Bristol-Myers will ship U.S. origin powder infant formulas,
"Enfamil", "Enfamil With Iron", and "ProSobee", in drums to
Canada. In Canada, the infant formulas will be packaged into
consumer size cans. The infant formulas will not undergo any
further processing, such as blending or mixing, in Canada,
except for the above described packaging operations. Upon
completion of the packaging operation, the infant formulas will
be imported into the U.S.
ISSUE:
Whether the infant formulas are eligible for the duty
exemption available under HTSUS subheading 9801.00.10 when
imported into the U.S.
LAW AND ANALYSIS:
Subheading 9801.00.10, HTSUS, provides for duty-free entry
of U.S. products that are exported and returned without having
been advanced in value or improved in condition by any means
while abroad. Articles satisfying the above conditions of the
statute will be afforded duty-free treatment, provided the
documentary requirements of section 10.1, Customs Regulations (19
CFR 10.1), are met.
The packaging abroad of U.S.-made products will not preclude
classification under this tariff provision when there is no
improvement in condition or advancement in value of the products
themselves, apart from their containers. See, United States v.
John V. Carr & Sons, Inc., 69 Cust.Ct. 78, C.D. 4377 (1972),
aff'd 61 CCPA 52, C.A.D. 1118 (1974), in which the court stated
that absent some alteration or change in the item itself, the
mere repackaging of the item, even for the purpose of resale to
the ultimate consumer, is not sufficient to preclude the
merchandise from being classified under item 800.00, Tariff
Schedules of the United States (TSUS) (the precursor to
subheading 9801.00.10, HTSUS).
We have consistently held that packaging a finished product
from large containers into smaller containers for retail sale is
permissible under subheading 9801.00.10, HTSUS. See, C.S.D. 79-
184, 13 Cust.Bull. 1250 (1979), which held that the transfer of
brake fluid from large tanks to 12-ounce cans did not advance the
value or improve the condition of the brake fluid; and
Headquarters Ruling Letter 555624 dated May 1, 1990, which held
that U.S. perfumes packaged into sample pouches qualified for
HTSUS subheading 9801.00.10 treatment.
In the present case, the infant formulas will be exported in
a finished condition to Canada to be packaged into consumer size
cans, and will not be subjected to any other operations prior to
their return. The infant formulas will not be advanced in value
or improved in condition while abroad. Accordingly, the infant
formulas will qualify for treatment under HTSUS subheading
9801.00.10.
HOLDING:
On the basis of the information and samples submitted, as
the infant formulas will not be advanced in value or improved in
condition abroad as a result of the packaging operation, they
will qualify for the duty exemption available under HTSUS
subheading 9801.00.10, upon compliance with the documentary
requirements of 19 CFR 10.1.
Sincerely,
John Durant, Director
Commercial Rulings Division