CLA-2 CO:R:C:S 556580 SER
District Director of Customs
La Puntillo #1
Old San Juan, Puerto Rico 00903
RE: Internal Advice 29/91; Section 215 and 222 Customs and Trade
Act of 1990; classification; CBERA; Puerto Rico, Haiti;
medical products
Dear Sir:
This is in reference to your memorandum, dated May 8, 1991,
received by this office on March 2, 1992, forwarding a request
for internal advice from Fermin R. Morales, Inc., on behalf of
Bauer and Black, concerning eligibility under the Caribbean Basin
Economic Recovery Act (CBERA)(19 U.S.C. 2701-2706) for rigid
wrist braces, wristlets, hernia belts and sacro-iliac belts for
men and women.
FACTS:
The articles at issue are rigid wrist braces, hernia belts,
wristlets and sacro-iliac belts for men and women. The rigid
wrist brace is used to immobilize an injured wrist joint and
protect the injured wrist from sudden movements which would
aggravate the injury. The provided sample (large size) is
approximately six inches long and is made of a soft stretch knit
fabric. It has three velcro tab closures, an adjustable velcro
strap and loop, and a removable bent aluminum splint. It is
stated to fit either the left or right wrists.
The hernia belt is used by individuals who have suffered
from an inguinal rupture. The belt is approximately four inches
wide and is made of tightly woven fabric with two side elastic
panels to fit the contour of the hips, two adjustable leg straps,
hook and eye fasteners in the front, and adjustable buckles and
lace closure in the back. The belt also has two movable pads for
precise positioning over the hernia.
The wristlet is a wrist band made of a lightweight elastic
textile material with a velcro fasteners. It is approximately
nine inches long and three inches wide. It is stated that the
article reduces swelling, supports weakened muscles and helps
minimize pain in the wrists.n
-2-
The sacro-iliac belt for men and women is stated to help
relieve lower back pain and spasms. In addition, they also are
stated to provide support and may be used as a posture aid. They
are made of a tightly woven rigid fabric that is doubled the
whole length of the belt. They are approximately six inches wide
and a minimum of approximately four inches long. The belts have
adjustable hook and eye fasteners in the front, adjustable
straps and buckles in the back, four flexible stays, a removable
reinforced foam rubber pad in a back pouch, and two half-moon
shaped elastic panels that fit the contour of the hips.
The manufacture of all these articles is done by Bauer &
Black, Inc., and is stated to use components "wholly the product
of the U.S. (Mainland U.S.A. and Puerto Rico)." Based on the
importer's submission, it appears that U.S.-origin yarn is
manufactured into fabric in Puerto Rico. In Puerto Rico the
fabric is then cut to shape, and exported in a condition ready
for assembly, by sewing, to Haiti. Other parts and accessories,
stated to be wholly of U.S.-origin, and used in the manufacture
of the articles at issue, are also sent with the cut fabric to
Haiti. It is stated that no materials of non-U.S. origin are
added in Haiti. These articles are then to be directly imported
to Puerto Rico.
ISSUE:
1. What is the proper classification of the articles at issue?
2. Whether the merchandise at issue is entitled to duty-free
treatment under the CBERA or under U.S. Note 2(b),
subchapter II, Chapter 98, Harmonized Tariff Schedule of the
United States Annotated (HTSUSA).
LAW AND ANALYSIS:
1. Classification
Classification of goods under the HTSUSA is governed by the
General Rules of Interpretation (GRI's), taken in order. GRI 1
provides that classification shall be determined according to the
terms of the headings and any relative section or chapter notes.
Heading 9021, HTSUSA, provides for "orthopedic appliances,
including crutches, surgical belts and trusses; splints and other
fracture appliances" ...." The Explanatory Notes, which
constitute the official interpretation of the HTSUSA at the
international level, state that this provision encompasses
trusses used for inguinal support purposes, corset trusses with
various special features used for posture purposes, and
appliances with splints for the arms. The sacro-iliac belt, the
hernia belt and the rigid wrist brace would fall withinn-3-
subheading 9021.19.8000, HTSUSA. In Headquarters Ruling Letter
(HRL) 083995 dated May 1, 1989, Customs ruled that similar
articles are properly classified in heading 9021, HTSUSA.
Subheading 3005.90.5090, HTSUSA, provides for wadding, gauze
bandages and similar articles, ... put up in forms or packing for
retail sale for medical, ... [or] surgical purposes .... The
wristlets would be properly classified in this tariff provision.
2. Sections 215 and 222 of the Customs and Trade Act of 1990
There are two alternative statutory provisions which may be
applicable for the products at issue in this case. Section 215
of the Customs and Trade Act of 1990 (Public Law 101-382) amended
section 213(a) of the CBERA (19 U.S.C. 2703(a)) to provide for
the duty-free treatment of articles (other than those ineligible
for CBERA treatment), which are the growth, product, or
manufacture of Puerto Rico and which subsequently are processed
in a CBERA beneficiary country (BC). The duty-free
treatment provided under 19 U.S.C. 2703(a)(5) applies to an
article which is the growth, product, or manufacture of Puerto
Rico, if:
(A) the article is imported directly from the beneficiary
country into the customs territory of the United
States,
(B) the article was by any means advanced in value or
improved in condition in a beneficiary country, and
(C) if any materials are added to the article in a
beneficiary country, such materials are a product of a
beneficiary country or the United States.
Based on the present information, we find that the hernia
belts, wrist braces, wristlets and sacro-iliac belts at issue
satisfy the above requirements. The primary component-- fabric-
-used in the assembly of the articles in Haiti appears to be the
product or manufacture of Puerto Rico. Any components not
manufactured in Puerto Rico are stated to be the product of the
U.S. In addition, as stated in General Note 3(c)(v)(A),
Harmonized Tariff Schedule of the United States Annotated
(HTSUSA), Haiti, the country in which the articles are
subsequently processed, is a BC for purposes of the CBERA.
Moreover, these articles are CBERA-eligible articles. They
are properly classified in heading 9021, HTSUSA, or subheading
3005.90.5090, HTSUSA, which are CBERA eligible provisions. It is
also required that the articles be advanced in value or improved
in condition by any means in a BC. The operations that are
performed in Haiti clearly fulfill this requirement of the
legislation.n -4-
Section 222 of the Customs and Trade Act of 1990 (P.L. 101-
382) amended U.S. Note 2, subchapter II, Chapter 98, HTSUSA,
("Note 2(b)") to provide for duty-free treatment of articles,
other than certain specified products, which are assembled or
processed in a Caribbean Basin Initiative beneficiary country
(BC) wholly of fabricated components or ingredients (except
water) of U.S. origin.
Specifically, Note 2(b) provides as follows:
(b) No article (except a textile article, apparel article,
or petroleum, or any product derived from petroleum,
provided for in heading 2709 or 2710) may be treated as a
foreign article, or as subject to duty, if-
(i) the article is--
(A) assembled or processed in whole of fabricated
components that are a product of the United
States, or
(B) processed in whole of ingredients (other than
water) that are a product of the United
States, in a beneficiary country; and
(ii) neither the fabricated components, materials or
ingredients, after exportation from the United
States, nor the article itself, before importation
into the United States, enters the commerce of any
foreign country other than a beneficiary country.
As used in this paragraph, the term "beneficiary country"
(BC) means a country listed in General Note 3(c)(v)(A),
HTSUSA.
As stated above, Note 2(b) specifies four categories of
products which are excluded from duty-free treatment under this
provision: textile articles; apparel articles; petroleum; and
certain petroleum products. The issue presented here concerns
whether the articles are included in the "textile and apparel
article" exclusion for purposes of Note 2(b). It is the position
of Customs that what constitutes "textile and apparel articles"
for purposes of Note 2(b), are those articles which are subject
to textile agreements as evidenced by a textile category number
in the HTSUSA provision in which they are classified. See,
Treasury Decision 91-88, 25 Cus.Bull. 45, p.1 (November 6, 1991).
Since none of the articles at issue are subject to textile
agreements, they are all eligible for duty-free treatment under
this note.
Note 2(b)(i) specifies that an eligible article will be
entitled to duty-free treatment if it is:n-5-
(A) assembled or processed in whole of fabricated
components that are a product of the U.S., or
(B) processed in whole of ingredients (other than
water) that are a product of the U.S., in a
BC.
Although a detailed description of the assembly operations
to be performed in Haiti was not provided, based on the
information provided, sewing the cut-to-shape materials and other
parts and accessories together to form the final article would be
encompassed by the operations specified in Note 2(b)(i).
Therefore, if, in fact, all materials are of U.S. origin and have
been shipped directly to Haiti, and the articles are shipped
directly to the customs territory of the U.S. without entering
into the commerce of any foreign country other than a BC, the
medical articles will be entitled to duty-free treatment under
Note 2(b), provided all of the documentation requirements set
forth in Headquarter Telex 9264071 dated September 28, 1990 (copy
enclosed) are met.
HOLDING:
The articles at issue are CBERA eligible articles, which
were produced from fabric, the growth, product, or manufacture of
Puerto Rico and were advanced in value or improved in condition
in a BC by the assembly of the fabric with components which are
exclusively of U.S. origin. Therefore, assuming that the
articles are imported directly to the customs territory of the
United States, they are entitled to duty-free treatment under 19
U.S.C. 2703(b)(5), upon compliance with the documentation
requirements set forth in Headquarters' telexes dated September
28, 1990 (9271073) and December 20, 1990 (1354071)(copies
enclosed).
In addition, based on the information presented, the
articles at issue would also be eligible for duty-free treatment
under U.S. Note 2(b), subchapter II, Chapter 98, HTSUSA, upon
compliance with the imported directly requirement and the
documentation requirements as set forth in Headquarter telex of
September 28, 1990 (9264071).
It should be noted that trade between the United States and
Haiti has been restricted pursuant to Presidential Executive
Order 12779 dated October 28, 1991, Vol. 56, Federal Register No.
210 October 30, 1991, p. 55973. Customs Headquarters has issued
seven telexes concerning the trade restrictions. The most recent
telex 2037113 dated February 6, 1992 (copy enclosed), states in
pertinent part that, effective February 5, 1992, U.S.-origin
goods, processed or assembled in Haiti may be entered and
released from Customs if accompanied by an appropriate specificn-6-
license issued by the Office of Foreign Assets Control to the
importer. This license, in effect, will be a blanket
authorization covering all such importations from and
exportations to Haiti by such firm for the time period specified
in such license. Any further questions regarding the
restrictions on trade with Haiti should be directed to the OFAC.
The proper classification of the sacro-iliac belt, the
hernia belt and the rigid wrist brace is subheading 9021.19.8000,
HTSUSA, with a rate of duty of 5.8% ad valorem. The proper
classification subheading of the wristlet is 3005.90.5090,
HTSUSA, with a rate of duty of 7% ad valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division