CLA-2 CO:R:C:T 089080 HP
5401.10.0000; 5515.19.0090; 5807.10.1090;
5608.19.2090; 6002.43.0010; 7318.15.80;
8302.30.3000; 9801.00.1099
District Director
U.S. Customs Service
111 West Huron Street
Buffalo, NY 14202
RE: Further Review of Protest Number 0901-0-000399
Dear Sir or Madam:
This is in reply to your Memorandum of June 27, 1990,
forwarding Application for Further Review of Protest Number 0901-
0-000399. Please reference PRO-2-06:COD:LM.
FACTS:
The merchandise at issue consists of various items described
by protestant's counsel, Dorsey & Whitney, as follows:
[Importer's] facilities manufacture
automobile map pockets and cargo restraint
net assemblies (Assemblies) for installation
as original motor vehicle equipment in
automobiles assembled in the United States by
bona-fide motor-vehicle manufacturers. The
components of the Assemblies are: (1) man-
made fiber netting, which can be either (a)
raschel or (b) knotted; (2) webbing, which is
woven from polyester and sewn on the
lengthwise borders of the netting; (3)
polypropylene and neoprene bungee border
cords (bungee), which are inserted through
the webbing, and have a loop sewn on each
end; (4) thread, which is used to sew the
webbing onto the netting; (5) plastic and
metal hardware, which is used to connect the
Assemblies to the automobiles by fitting in
the loops of the bungee; and (6) patent-
pending and warning labels which are sewn on
the Assemblies.
Assemblies are installed in the United
States by [domestic automobile manufacturers]
in the trunks of their new passenger
vehicles.
The Assemblies are used to prevent luggage or
other articles from moving around in the
motor vehicles. The Assemblies are
manufactured to the precise size and shape
required for the specific location in the
particular automobiles in which they will be
installed.
U.S. motor-vehicle manufacturers order
Assemblies from [Importer] for installation
in new automobiles. in the past, all the
Assemblies were assembled in Canada and
supplied directly to the motor-vehicle
manufacturer or its original equipment
manufacturer for installation in the
component parts of new automobiles.
Beginning in 1989, however, [Importer's U.S.]
facility was open to provide an additional
assembly facility for the Assemblies. The
U.S. motor-vehicle manufacturers continue to
place their orders with [Importer's Canada
facility], and that facility decides whether
to fill the order with Assemblies from
[Canada] or [the U.S.]. In either case, the
Assemblies are made to order specifically for
the model of automobile in which they will be
installed. If the Assemblies are assembled
at [the U.S. facility], the components are
shipped there from [Canada]. The merchandise
that is the subject of this protest consists
of component parts of the Assemblies shipped
to [the U.S. facility] from [Canada] to be
used as original motor-vehicle equipment in
new automobiles pursuant to contracts between
[the Canada facility] and bona-fide motor-
vehicle manufacturers in the United States.
The netting is produced ... from nylon
yarn loaded into a bobbin. The machines used
... make nets of a certain number of loops
and the exact width for a particular car or
truck. The appropriate quantities of
netting, webbing, and bungee to make the
desired number of Assemblies for a particular
automobile are shipped to [the U.S.], with
the appropriate amount of thread, labels, and
hardware for the [A]ssemblies.
At [the U.S. facility], the nets,
webbing, and bungee are cut to the
appropriate length for the new Assemblies for
particular automobiles. The webbing is sewn
onto the net, the bungee is inserted through
the webbing, and the labels are sewn on. The
finished Assemblies are then shipped to the
U.S. motor-vehicle manufacturers for
installation as original equipment in new
automobiles.
With the exception of the bungee, which
was produced in the United States, all of the
components of the Assemblies were produced in
Canada. A Shipper's Declaration of Canadian
Origin was filed with the entries.
We assume the "hardware" referenced above is identical to that
hardware subject to Protest 3801-0-003519, HRL 951390 of April 8,
1992.
Importer attempted to enter the merchandise as follows:
Poly bags under subheading 3923.21.00, HTSUSA, at
Canadian Free Trade Agreement reduced rate of 2.7% ad
valorem. Customs agreed with the classification, but
denied reduced duty (3%) because importer failed to
provide an Exporter's Certificate of Origin.
Pallets under subheading 4415.20.80, HTSUSA, at
Canadian Free Trade Agreement reduced rate of 14.4% ad
valorem. Customs agreed with the classification, but
denied reduced duty (16.67%) because importer failed to
provide an Exporter's Certificate of Origin.
All other items under subheading 8708.29.0050, HTSUSA,
as automobile parts subject to duty-free treatment
under the Automobile Products Trade Act of 1965 (APTA).
See General Note 3(c)(iii) to the HTSUSA. Customs
disagreed, classifying all but the raschel netting in
various subheadings throughout the HTSUSA, denying
duty-free treatment under the APTA, and denying reduced
duty under the CFTA.
ISSUE:
Whether the items are considered fabricated components under
the APTA? If not, whether the items are entitled to duty-reduced
treatment under the CFTA?
LAW AND ANALYSIS:
Claimed Classification
Heading 8707, HTSUSA, provides for parts and accessories of
motor vehicles. In HRL 088757 of March 16, 1992, we ruled upon
this Importer's Application for Further Review of Protest #0901-
90-000276 - finished Assemblies for automobiles. Therein, we
held that the made up cargo nets could not be classified as parts
of automobiles because "the provision for made up nets [5608]
specifically describes the goods in question, i.e., the cargo net
assemblies are made up nets of textile materials." See General
Explanatory Note III to Section XVII, HTSUSA (parts must not be
more specifically included elsewhere in the Nomenclature).
CFTA Reduced Duty
Section 10.307(c), Customs Regulations (19 C.F.R.
10.307(c)), states that for goods for which a preference is
claimed under the CFTA, an Exporter's Certificate of Origin (CF
353) must be available at the time the preference is claimed.
The Shipper's Declaration of Canadian Origin, while documentation
required under APTA, does not substitute for the CF 353. Duty
reduction under the CFTA was properly denied.
American Goods Returned
Subheading 9801.00.10, HTSUSA, provides for, inter alia,
American Goods exported and returned. Counsel claims that the
imported bungee is properly classified herein
because it is a product of the United States
returned after having been exported, without
having been advanced in value or improved in
condition by any process of manufacture or
other means while abroad. All of the bungee
was imported into Canada from [a company in
the U.S.]. All of the bungee was returned to
the United States in its original form and
did not undergo any processing while it was
in Canada.
We agree. The bungee is therefore eligible, under the specific
factual situation described above, for a Free rate of duty, upon
compliance with all applicable regulations.
HOLDING:
As a result of the foregoing, the instant merchandise is
classified as follows:
Bungee
... under subheading 9801.00.1099, HTSUSA, as products of
the United States when returned after having been exported,
without having been advanced in value or improved in
condition by any process of manufacture or other means while
abroad, other, other. The applicable rate of duty is Free.
Raschel Netting
... under subheading 6002.43.0010, HTSUSA, textile category
229, as other knitted or crocheted fabrics, other fabrics,
warp knit (including those made on galloon knitting
machines), of man-made fibers, open-work fabrics. The
applicable rate of duty is 14 percent ad valorem.
Knotted Netting
... under subheading 5608.19.2090, HTSUSA, textile category
229, as knotted netting of twine, cordage or rope; made up
fishing nets and other made up nets, of textile materials,
of man-made textile materials, other, other, other. The
applicable rate of duty is 10 percent ad valorem.
Webbing
... under subheading 5515,19.0090, HTSUSA, textile category
220, as other woven fabrics of synthetic staple fibers, of
polyester staple fibers, other, other, other. The
applicable rate of duty is 17 percent ad valorem.
Thread
... under subheading 5401.10.0000, HTSUSA, textile category
200, as sewing thread of man-made filaments, whether or not
put up for retail sale, of synthetic filaments. The
applicable rate of duty is 13 percent ad valorem.
Labels
... under subheading 5807.10.1090, HTSUSA, as labels, badges
and similar articles of textile materials, in the piece, in
strips or cut to shape or size, not embroidered, woven,
labels, other. The applicable rate of duty is 9 percent ad
valorem.
Hardware
... the plastic mushrooms, T-anchors and D-anchors, each
containing screws, and the plastic mushrooms, T-anchors and
D-anchors, each without screws but having threaded centers,
under subheading 3926.30.5000, HTSUSA. The applicable rate
of duty is 5.3 percent ad valorem.
... the base metal screws under subheading 7318.15.80,
HTSUSA. The applicable rate of duty is 9.5 percent ad
valorem.
... The mounting brackets under subheading 8302.30.3000,
HTSUSA. The applicable rate of duty is 3.1 percent ad
valorem.
Poly Bags
... under subheading 3923.21.0050, HTSUSA (HTSUSA number in
effect at time of entry), as articles for the conveyance or
packing of goods, of plastics; stoppers, lids, caps and
other closures, of plastics, sacks and bags (including
cones), of polymers of ethylene. The applicable rate of
duty is 3 percent ad valorem.
Pallets
... under subheading 4415.20.8000, HTSUSA, as packing cases,
boxes, crates, drums and similar packings, of wood; cable-
drums, of wood; pallets, box-pallets and other load boards,
of wood, pallets, box-pallets and other load boards, other.
The applicable rate of duty is 16~ percent ad valorem.
The protest should be allowed in part and denied in part
consistent with the opinions expressed above. A copy of this
decision should be attached to the Customs Form 19 and provided
to the protestant as part of the notice of action on the protest.
Sincerely,
John Durant, Director
Commercial Rulings Division