CLA-2-CO:R:C 555411 RA
TARIFF NOS.: 9802.00.50 and 9802.00.80, HTSUS
Mr. John W. Cain
P.O. Box 150
Hildago, Texas 78557
RE: Tariff treatment of primary wire exported in bulk and either
cut and wound on spools in 100-foot lengths or cut to various
lengths, coiled, and secured with a twist tie.
Dear Mr. Cain:
This is in response to your letter of June 2, 1989,
requesting a ruling on the applicability of subheading
9802.00.80, Harmonized Tariff Schedule of the United States
(HTSUS), to certain wire which is exported in bulk and processed
in Mexico by being cut and wound on spools holding 100 feet or
cut and wound into various length coils which are tied with a
twist tie.
FACTS:
Primary wire is exported to Mexico where it is cut and
either placed on spools in 100-foot lengths or cut and wound into
coils which are of various lengths and tied with a twist tie.
The wire on return to the U.S. is used for repairing automobile
wiring, primarily for signal lights. It is assumed that the wire
is manufactured in the U.S.
ISSUE:
Are the Mexican operations considered sufficient to entitle
the processed wire to a duty allowance under the provisions of
subheadings 9802.00.80 or 9802.00.50, HTSUS?
LAW AND ANALYSIS:
Subheading 9802.00.80, HTSUS, provides for a partial
exemption from duty for articles assembled abroad in whole or in
part of fabricated components of U.S. origin which have been
exported ready to be assembled without loss of identity or
improved in condition or advanced in value except by assembly or
operations incidental thereto.
The process of cutting the exported U.S.-made wire to
various lengths and placing it on spools or in coils does not
involve the joining of two or more fabricated components so as
to constitute an assembly as defined in section 10.12(b), Customs
Regulations (19 CFR 10.12(b)). Accordingly, the provisions of
subheading 9802.00.80, HTSUS, would not be applicable to the
returned wire.
Subheading 9802.00.50, HTSUS, provides for a partial duty
exemption for articles returned to the U.S. after having been
exported for alterations. The articles must be completely
finished when exported from the U.S. and not undergo any
intermediate processing operations while abroad. The rolls of
wire are complete and finished at the time of exportation and the
cutting to length is not considered to be a finishing step in the
manufacture of the imported product. In a ruling published as
C.I.E. 1113/65 on August 3, 1965, and abstracted as T.D. 56448,
we held that American yarn wound on large spools and sent abroad
to be rewound on small wooden rolls was entitled to a partial
exemption from duty as the operation was considered to be an
alteration. This conclusion was followed by our ruling dated
September 9, 1986 (file 078034), which held that fabric sent
abroad in rolls and rewound into smaller rolls of the same width
after being cut into shorter lengths had merely been altered and
was eligible for a partial duty exemption.
Accordingly, the cutting of the wire in the subject case
into shorter lengths and placing it on spools or tying it into
coils would not constitute an assembly but would qualify as an
alteration under the provisions of subheading 9802.00.50, HTSUS,
upon compliance with section 10.8, Customs Regulations (19 CFR
10.8).
HOLDING:
The cutting of exported wire into shorter lengths and
winding it on spools or tying it into coils does not amount to
an assembly under subheading 9802.00.80, HTSUS, but does qualify
as an alteration under subheading 9802.00.50, HTSUS, with duty
assessed upon the cost of the foreign processing, upon compliance
with 19 CFR 10.8.
Sincerely,
John Durant, Director
Commercial Rulings Division