CLA-2 RR:TC:TE 961213 jb
Gail T. Cumins, Esq.
Sharrets, Paley, Carter & Blauvelt, P.C.
67 Broad Street
New York, NY 10004
RE: Claim for detrimental reliance; "Hydro Fleece" garments
Dear Ms. Cumins:
On January 6, 1998, this office issued HQ 960450, in
response to your application for further review of protest number
4503-96-100026, on behalf of your client, Browning Arms Division,
regarding the classification of certain Hydro Fleece garments.
This letter is in response to the claim of detrimental reliance
addressed by you in that letter.
FACTS:
The merchandise that was the subject of the protest
addressed in HQ 960450 consists of hunting garments comprised of
jackets, pants and bib overalls, made from a knit fabric
laminated to a plastic Goretex membrane. This material is
described as "Hydrofleece". As confirmed by a Customs Laboratory
report these garments are of knit pile construction and are
properly classified in the appropriate subheadings of Chapter 61,
HTSUS.
You claim that as a result of the importation history of
this merchandise (previously detailed in HQ 960450), your client
relied to his detriment on Customs classification of this
merchandise in Chapter 62, HTSUS, when it purchased and sold the
garments covered by the entries under the protest addressed in HQ
960450. Accordingly you are seeking relief on behalf of your
client for those entries.
ISSUE:
Whether the Protestant has substantiated the claim for
"detrimental reliance"?
LAW AND ANALYSIS:
As provided for under 19 CFR 177.9(e)(1):
The Customs Service will from time to time issue a ruling
letter covering a transaction or issue not previously the
subject of a ruling letter and which has the effect of
modifying the treatment previously accorded by the Customs
Service to substantially identical transactions of either
the recipient of the ruling letter or other parties.
Although such a ruling letter will generally be effective on
the date it is issued, the Customs Service may, upon
application by an affected party, delay the effective date
of the ruling letter, and continue the treatment previously
accorded the substantially identical transaction, for a
period of up to 90 days from the date the ruling letter is
issued.
CFR 177.9(e)(2) states:
In applying to the Customs Service for a delay in the
effective date of a ruling letter described in paragraph
(e)(1) of this section, an affected party must demonstrate
to the satisfaction of the Customs Service that the
treatment previously accorded by Customs to the
substantially identical transactions was sufficiently
consistent and continuous that such party reasonably relied
thereon in arranging for future transactions. The evidence
of past treatment by the Customs Service shall cover the 2-year period immediately prior to the date of the ruling
letter, listing all substantially identical transactions by
entry number (or other Customs assigned number), the
quantity and value of merchandise covered by each such
transaction (where applicable), the ports of entry, and the
dates of final action by the Customs Service. The evidence
of reliance shall include contracts, purchase orders, or
other materials tending to establish that the future
transactions were arranged based on the treatment previously
accorded by the Customs Service.
Based upon your submission, the following is established:
1. All references to this merchandise on the invoices
indicate that the garments are of knit construction;
2. Samples were presented to the Customs laboratory for
testing;
3. In 1995 your client protested entries which were
classified in 6201 and 6211, HTSUS, based on a
memorandum (HQ 081134, dated April 17, 1989) addressing
woven garments with a Goretex lamination. This protest
was granted by Customs and the classification of those
garments was changed to 6210, HTSUS;
4. Importation of this merchandise has continued from 1992
through 1996.
The rules of law defining detrimental reliance are
explicitly and clearly delineated in the Code of Federal
Regulations as noted above. The critical elements in
substantiating a claim for detrimental reliance are that the
reliance was reasonable and that the importer suffered a
detriment based on that reliance. Reliance is predicated on a
ruling, issued to the importer or to a third party addressing
identical or virtually identical merchandise, or consistent
treatment. In the case before us your client does not satisfy
all of these aforementioned elements.
First, although your client submitted samples of the
garments to Customs, there was never any reliance on a Customs
binding ruling which classified garments similar to the subject
knit garments in a provision for woven garments. Secondly, it is
clear that Customs erred when it examined the garments and
determined that they were classified in chapter 62, HTSUS,
despite the clear description on the invoices stating "polyester
knitted fabric shell". Thereafter, subsequent importations of a
variety of coated knit garments were entered by your client in
headings 6201 or 6211, HTSUS. As such, when your client
protested those classifications in headings 6201 or 6211, HTSUS,
and asked for reclassification in heading 6210, HTSUS, based on
HQ 081134 which addressed the classification of woven garments
with a Goretex laminate, Customs believed the garments were woven
garments and granted the protest. Although we are not trying to
exonerate Customs completely for the confusion which occurred
with this merchandise, this office is of the opinion that the
importer should have cleared up the confusion at its onset. This
issue does not involve complex issues of law, but simple facts-
knit garments versus woven garments. Once the knit garments were
classified in a provision for woven garments, giving the importer
an advantage in the tariff rate, the importer should have
corrected this oversight immediately and not continued to take
advantage of an obvious error on the part of Customs. Based on
these facts we find that the importer's reliance on the
classification of knit garments in a provision for woven garments
was not reasonable.
Consequently, your request for detrimental reliance is
denied.
This action is being taken in accordance with 19 CFR
177.9(e)(1) and 19 CFR 177.9(e)(3). Any questions concerning
this letter should be directed to the Textile Classification
Branch, Office of Regulations and Rulings.
Sincerely,
John Durant, Director
Commercial Rulings Division