CLA-2 CO:R:C:V 555361 GRV
TARIFF NO: 9802.00.80, HTSUS
Saul L. Sherman, Esq.
750 Third Avenue, Suite 2400
New York, New York 10017
RE: Applicability of partial duty exemption under HTSUS subhead-
ing 9802.00.80 to certain textile products, designed for use
as offset printing blankets, imported from Hungary.C.J.
Tower & Sons of Buffalo, Inc. (1969);classification.
Dear Mr. Sherman:
This is in response to your letter of December 23, 1988, on
behalf of A&B Rubber Products Co., Inc., requesting a ruling on
the applicability of subheading 9802.00.80, Harmonized Tariff
Schedule of the United States (HTSUS) (formerly item 807.00,
Tariff Schedules of the United States (TSUS)), to certain textile
products, designed for use as offset printing blankets, to be
imported from Hungary. You also inquire as to the proper tariff
classification of this product, a sample of which was submitted
for examination.
FACTS:
You state that fabric of U.S. origin, consisting of 60 to 70
percent cotton and 30 to 40 percent rayon, will be exported on
rolls 60 to 90 inches wide and 200 to 400 yards in length. The
operations to be performed abroad entail laminating the rolled
fabric to other identical rolls to form three or four-ply
material, and covering this material with a layer of synthetic
rubber of foreign origin. The first step in the foreign
processing consists of combining U.S. fabric from two rolls by
applying a polymer adhesive between the two materials and
hardening the adhesive by the application of heat. Three-ply
base material is produced by taking a roll of the resulting two-
ply material and performing a similar adhesion/heating operation
with a single-ply roll of U.S. fabric. Four-ply material is
produced by taking two two-ply rolls and repeating the adhesion/
heating operation. Once a three or four-ply backing has been
prepared, a further layer of adhesive will be applied to the top
of the base prior to the application of the rubber coating.
This prevents any significant intermingling of the molten rubber
with the surface of the fabric itself. The rubber layer is
applied in molten form to the top ply and is passed through
pressure rollers to laminate it and obtain the proper gauge.
The rubber material is then vulcanized by passing it through an
oven. The textile material is trimmed to insure that the sides
are even and to remove any seepage of the rubber cement at the
sides. The textile product is then returned to the U.S. in
rolls, where it is cut to size and marketed as blankets on offset
presses. The imported product has no other use.
ISSUE:
Whether the returned product qualifies for the partial duty
exemption provided for in HTSUS subheading 9802.00.80.
LAW AND ANALYSIS:
As you know, the HTSUS superseded and replaced the TSUS,
effective January 1, 1989. TSUS item 807.00 was carried over
into the HTSUS without change as subheading 9802.00.80. This
tariff provision provides a partial duty exemption for articles:
...assembled abroad in whole or in part of fabricated
components, the product of the United States, which
(a) were exported in condition ready for assembly
without further fabrication, (b) have not lost their
physical identity in such articles by change in form,
shape, or otherwise, and (c) have not been advanced in
value or improved in condition abroad except by being
assembled and except by operations incidental to the
assembly process such as cleaning, lubricating, and
painting.
All three requirements of HTSUS subheading 9802.00.80 must be
satisfied before a component may receive a duty allowance. An
article entered under HTSUS subheading 9802.00.80 is subject to a
duty upon the full value of the imported article, less the cost
or value of the U.S. components assembled therein, provided their
has been compliance with the documentary requirements of section
10.24, Customs Regulations (19 CFR 10.24).
In C.J. Tower & Sons of Buffalo, Inc. v. United States, 62
Cust. Ct. 643, C.D. 3840, 304 F.Supp. 1187 (1969), plastic film
composed of two plastic sheets--one Canadian polyethylene, the
other U.S. polyester mylar--was produced in Canada by an extru-
sion process in which the foreign polyethylene, in molten form,
was joined with the U.S. mylar sheets through the use of an
adhesive or adhesive promoter. After the resultant product
cooled into a solid, the plastic film was trimmed a quarter of an
inch. The court found that the processing was nothing more or
less than a combination of manufacturing (the foreign material)
and assembling operations, that there was no intermixing of the
sheets in the involved process, that the adhesive or adhesion
promoter did not produce a change in the mylar's physical
identity, form or shape, and that the process was a controlled
operation which anticipated the transformation of the foreign
liquid into a solid before completion of the process, and
provided in advance for the adhesion of two solids together in
the final product. The court concluded that the foreign
operation involved the assembly of two solids and that the U.S.
mylar component was entitled to the duty exemption under TSUS
item 807.00.
The facts in the present case are substantially similar to
the facts before the court in the C.J. Tower case and, in similar
fashion, we find that the foreign operation constitutes an
assembly of solids within the ambit of HTSUS subheading
9802.00.80. Rolls of U.S. fabric are laminated together by
application of a polymer adhesive to form three and four-ply
material. A further layer of the same adhesive is applied to the
top of the base material and the foreign synthetic rubber is
applied in molten form. The resultant product is vulcanized by
passing it through an oven, and then is trimmed to insure that
the sides are even. An examination of the sample product
submitted shows that there is no intermixing of the sheets in the
involved process and that the adhesive promoter does not produce
a change in the fabric's physical identity, form or shape.
Further, the information provided indicates that the process is a
controlled operation which anticipates the transformation of the
foreign liquid into a solid before completion of the process, and
provides in advance for the adhesion of two solids together in
the final product.
The trimming is considered incidental to the assembly operation
pursuant to section 10.16(b)(4), Customs Regulations (19 CFR
10.16(b)(4)).
Regarding the proper tariff classification of the returned
textile product, we note initially that the classification of
imported merchandise is determined in accordance with the General
Rules of Interpretation (GRI's), HTSUS, 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.
HTSUS Heading 5911 provides for textile products and articles,
for technical uses, specified in note 7 to chapter 59. The
Explanatory Notes constitute the official interpretation of the
tariff at the international level. The Explanatory Notes to
Heading 5911 state that the textile products and articles of this
heading present particular characteristics which identify them as
being for use in various types of machinery, apparatus, equipment
or instruments or as tools or parts of tools. Since the merchan-
dise at issue is designed and sold for use as blankets on offset
presses, it will be classified under HTSUS subheading
5911.10.1000, according to GRI 1.
HOLDING:
On the basis of the information and sample submitted, we
conclude that the textile products, designed for use as offset
printing blankets, will be eligible for the partial duty
exemption under HTSUS subheading 9802.00.80 when returned to the
U.S., upon compliance with the documentary requirements set forth
in 19 CFR 10.24. Allowances in duty may be made under this
tariff provison for the cost or value of the U.S. fabric. The
described textile product will be classified under HTSUS
subheading 5911.10.1000 with duty at the rate of 5.8 percent ad
valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division