CLA-2 CO:R:C 555201 RA
Richard G. Seley
Rudolph Miles & Sons
P.O. Box 144
El Paso, Texas 79942
RE: Classification of self adhesive index tabs assembled
from U.S. origin materials
Dear Sir:
This is in response to your letter of November 25, 1988, on
behalf of Avery International, relative to the tariff treatment
applicable to certain index tabs to be assembled in Mexico from
plastic and paper materials of U.S. origin.
FACTS:
Your client proposes sending rolls of polyester plastic 1
3/16 inch in width (to make the tab exterior), rolls of polyester
plastic 1 inch in width (to make the retainer skirt), rolls of
1/4 inch in width pressure sensitive paper tape, and glue to
Mexico for assembly into finished index tabs. Paper labels or
inserts cut to exact shape and scored for easy separation are
also sent to Mexico in the flat and will be only folded and
packaged with the tabs.
The foreign operations consist of placing the plastic strips
and paper tape into a machine where the glue and paper tape would
be applied to the 1 3/16 inch wide polyester plastic and the
product would be bent, beaded, and cut to length to a profile
shape. The plastic retainer skirt is shaped and applied under the
tab to prevent the paper labels from falling out in use by the
consumer. The finished plastic tabs and paper labels are counted
and packed in a rectangular clear plastic hinged box and these
units are packaged in cartons and shipping containers, all of
U.S. origin.
- 2 -
ISSUE:
Will the paper labels, plastic container, or plastic parts
be eligible for free entry as American goods returned and can an
allowance be made for the paper tape which is only cut to length
before being glued to the tab?
LAW AND ANALYSIS:
Subheading 9801.00.10, Harmonized Tariff Schedule of the
U.S. (HTSUS), provides that products of the U.S. when returned
after having been exported may be admitted free of duty if they
have not been advanced in value or improved in condition by any
process of manufacture or other means while abroad. Based upon
your description, the plastic components making up the tabs were
manufactured abroad from exported domestic-made strips by means
of cutting, beading, and forming and there has been a significant
advancement in value and improvement in condition of the plastic
raw material. Accordingly, free entry under subheading
9801.00.10, HTSUS, for these components is precluded.
The paper labels are unassembled parts of the index tabs and
cannot be constructively segregated to obtain separate tariff
treatment. Ruling 554059, dated April 9, 1986, held U.S.-made
glass shelves imported with a stereo cabinet assembled from
foreign parts could not be segregated to obtain free entry as
American goods returned. The pressure sensitive tape which
before assembly is merely cut to length may be accorded an
allowance in duty for its value under the provision of subheading
9802.00.80, HTSUS, for articles assembled abroad, upon compliance
with sections 10.11-10.24, Customs Regulations (19 CFR 10.11-
10.24). This provision is applicable only to fabricated
components assembled abroad without any processing other than
assembly and operations incidental thereto. Accordingly, it
would not apply to the plastic parts made by beading, bending,
and cutting to shape before being assembled. The plastic
container may be returned free of duty under the provisions of
subheading 9801.00.10, HTSUS, as a usual container the product of
the U.S. returned. The imported index tabs are classifiable
under the provisions of subheading 3926.10.00 HTSUS, as other
articles of plastics, office or school supplies, at the rate of
5.3 percent ad valorem.
- 3 -
HOLDING:
As plastic imparts the essential character of the index tabs
they are classifiable under the provision in subheading
3926.10.00, HTSUS, with an allowance for the value of the
pressure sensitive tape under subheading 9802.00.80, HTSUS. The
plastic container of U.S. origin is free of duty under subheading
9801.00.10, HTSUS.
Sincerely,
John Durant, Director
Commercial Rulings Division