CLA-2 CO:R:C:S 556092 LS
Marilyn-Joy Heintz, Esq.
Tompkins & Davidson
One Astor Plaza
1515 Broadway
43rd Floor
New York, New York 10004
RE: Applicability of subheading 9801.00.60, HTSUS, to fur
articles exported to Canada for display at fur show;
"public" fair; admission policy; 221961; 222792; 067426;
clarification of 092277
Dear Ms. Heintz:
This is in response to your letter of June 10, 1991, on
behalf of Trans-Border Customs Services, Inc. ("Trans-Border"),
requesting a ruling as to whether certain fur goods are eligible
for duty-free treatment under subheading 9801.00.60, Harmonized
Tariff Schedule of the United States (HTSUS), when returned to
the U.S., after exhibition at a fur show in Canada. In response
to our request for further information, you presented additional
facts in a letter dated August 22, 1991. A meeting was held at
Customs Headquarters on September 23, 1991.
FACTS:
The following facts are contained in your letter of June
10, 1991. One of Trans-Border Customs Services Inc.'s ("Trans-
Border") customers will be exporting fur goods (e.g., skins, fur-
trim garments, fur coats), of both U.S. and foreign origin, to
Canada from the U.S. for display at an annual "fur show." You
specifically state that the fur articles will be displayed by the
exhibitors for the purpose of soliciting sale orders from
attendees. The fur show, which is sponsored by an organization
of fur manufacturers, will have approximately 500 to 600
exhibitors who are primarily fur manufacturers or their sales
representatives. Attendance will be restricted to members of the
"fur industry," e.g., buyers for wholesale and retail fur stores.
Advance registration will be required, and proof of registration
and proper identification must be shown at the door.
At the meeting held at Customs Headquarters, you agreed
that, for purposes of this ruling, the following facts should be
assumed. Although you stated in your original letter that
attendance at the fur show is restricted to members of the fur
industry, you now modify this statement and agree that the
admission policy is restricted only to the extent that attendees
must have a reasonable business interest in attending the show.
For example, you state that anyone who is not yet a member of the
fur industry, but has an interest in becoming such a member,
would not be denied admission to the show. Admission to the show
is not restricted to members of a private trade association.
Preregistration is being required because of certain space
limitations of the show's facility. The show is being advertised
through trade or professional journals, as well as invitations or
letters sent to prospective attendees. You reiterate that the
purpose of the show is to exhibit new styles of fur articles and
that, in connection with that purpose, orders will be taken.
However, no items will be actually sold and delivered at the
show. Thus, the entire stock of merchandise exported to Canada
for the show will be returned to the U.S.
You contend that, based upon the foregoing facts, the fur
articles should be entitled to duty-free treatment under
subheading 9801.00.60, HTSUS, when they are returned to the U.S.
at the conclusion of the fur show. You assert that application
of this tariff provision is not restricted to fairs and
conferences that are open to the "public at large." Instead, you
contend that articles should remain eligible for entry under
subheading 9801.00.60, HTSUS, so long as they are exhibited at
trade fairs and conferences which are open to (1) members of a
specific industry or trade, and (2) anyone else who has a
reasonable business interest in attending the event. In support
of your position, you contend that the word "public," as used in
subheading 9801.00.60, HTSUS, only modifies the word
"exposition," not the words "fair" and "conference." You also
cite to several previous Headquarters Ruling Letters (HRL's)
which will be discussed below.
ISSUE:
Whether certain fur goods exported from the U.S. to Canada
for display at an annual fur show will be eligible for duty-free
treatment under subheading 9801.00.60, HTSUS.
LAW AND ANALYSIS:
Subheading 9801.00.60, HTSUS, (formerly item 802.30, Tariff
Schedules of the United States (TSUS)), provides for the free
entry of articles which are returned after having been exported
for temporary use abroad solely for exhibition or use in
connection with any public exposition, fair, or conference,
provided such articles are returned by or for the account of the
person who exported them.
The Customs Service has addressed the requirements of
subheading 9801.00.60, HTSUS, in several rulings. In HRL 067426
dated December 8, 1981, medical equipment was exported to Canada
for exhibition and demonstration at a joint meeting of the
International Society of Hematology and the International Society
of Blood Transfusion. The meeting or conference was open only
to members of these two societies, and not to the public at
large. Therefore, it was found not to be a "public" conference,
within the meaning of item 802.30, TSUS, and entry of the
equipment under that provision was precluded.
In HRL 221961 dated May 15, 1990, which was a response to an
internal advice request, a corporation exhibited jewelry and
semi-precious and precious gemstones at the Hong Kong Watch and
Jewelry Fair, and subsequently returned the articles to the U.S.
We held that because the primary intention of the importer was to
exhibit the goods at the trade fair and return them to the U.S.,
entry of the goods under subheading 9801.00.60, HTSUS, was not
precluded. The fact that a secondary objective of the importer
was the acquisition of future orders at the fair did not negate
the primary intention of the company at the time of exportation
to exhibit its wares. We found that the sole act of taking
future orders, without delivery of any goods at the show, was not
a sale of goods so as to preclude classification under subheading
9801.00.60, HTSUS. This finding was affirmed in HRL 222792 dated
January 10, 1991, which was a reconsideration of HRL 221961. We
noted in HRL 222792 that the trade fair's own rules prohibiting
sales buttressed the importer's argument that its intent was not
to sell goods at the fair.
In HRL 222792, we also tangentially addressed the "public"
requirement of subheading 9801.00.60, HTSUS. Even though the
Hong Kong Watch and Jewelry Fair was allegedly open only to
members of the watch and jewelry trades, we found no indication
that the fair excluded the general public. More specifically, we
stated that no evidence was presented, by way of brochures or
other tangible proof, that "if the general public showed up at
the fair and offered to pay admission (assuming one was needed)
they would be excluded." We stated that the general public can
be distinguished from those who belong to a private club or
association where admission is restricted to members only.
In HRL 092277 dated December 9, 1968, machinery and
equipment was to be displayed by sales representatives at an
exposition held in conjunction with a nonprofit professional
association's convention in Canada, and subsequently was to be
returned to the U.S. A registration fee was charged for the
convention, and the association targeted its advertising at its
members and their guests. However, the association stated that
if any person interested in the displayed equipment wished to
attend the convention, he or she could do so. Therefore, Customs
ruled that the convention was open to the "public" and was not a
private sales exposition. Provided the documentary requirements
were met, i.e., section 10.66, Customs Regulations (19 CFR
10.66), the equipment would be eligible for duty-free treatment
under item 802.30, TSUS, upon its return to the U.S.
Based upon the information you have provided, and the
assumed facts, we find that the fur articles are eligible for
duty-free treatment under subheading 9801.00.60, HTSUS, when they
are returned to the U.S. after exhibition at the fur show in
Canada. With respect to the "public" requirement of that
provision, we do not agree that the term "public" only modifies
the word "exposition," and not the words "fair" and "conference."
See HRL 067426 (the term "public" was applied to a medical
conference). However, we do agree that a fair or conference may
be considered "public" so long as it does not deny admission, for
reasons other than space limitation, to persons who have a
reasonable business interest in attending the event. The
admission policy you have described for the fur show fits within
these parameters. You have indicated that the advance
registration requirement is presumably imposed because of space
limitations of the show's facility. In addition, you have
suggested that if space is still available after counting all the
pre-registrants, then persons having a reasonable business
interest relating to the fair may register at the door. The
definition of a fair, as cited in HRL 221961, supports our
position that the instant fur show is a "public" fair within the
meaning of subheading 9801.00.60, HTSUS. "A fair is an
exhibition designed to acquaint prospective buyers or the public
at large with the range and quality of currently available or
planned products." HRL 221961, citing Webster's Third New
International Dictionary of the English Language, G. & C. Merriam
Co, 1971. We also stated in that ruling that the purpose of a
trade fair is "to generate interest in the products displayed and
in attracting prospective business," and that this "display of
domestic articles abroad at an exhibition promotes U.S. industry
for future business and/or manufacturing." The admission policy
of this fur show is consistent with these stated purposes of
trade fairs.
We believe that our position with respect to the
satisfaction of the "public" requirement of subheading
9801.00.60, HTSUS, is consistent with our holding in HRL 067426,
i.e., that a conference which was open only to members of two
medical societies was not "public" within the meaning of
subheading 9801.00.60, HTSUS. You have specifically stated that
the fur show does not restrict admission only to members of a
private trade association. To the extent that HRL 092277 may be
interpreted to mean that a fair or convention is considered to be
"public" only if it allows any person interested in the displayed
merchandise to attend, without having to show a reasonable
business interest, we depart from that ruling, and modify it in
accordance with the general guidelines set forth in this ruling.
We next consider the other requirement of subheading
9801.00.60, HTSUS, i.e., that the returned articles be exported
solely for exhibition or use at a public fair. Based upon the
assumption that the primary intent of Trans-Border's customers at
the time of exporting the fur articles is to exhibit them at the
fur show, and the secondary purpose is to solicit future orders
(with no articles actually being sold or delivered at the show),
we find that fur articles returned to the U.S. will be eligible
for duty-free treatment under subheading 9801.00.60, HTSUS. See
HRL 221961, reaffirmed in HRL 222792.
HOLDING:
For the foregoing reasons, we find that, based upon the
information you have provided and the assumed facts, the fur
articles are eligible for duty-free treatment under subheading
9801.00.60, HTSUS, when they are returned to the U.S. after
exhibition at the fur show in Canada.
Sincerely,
John Durant, Director
Commercial Rulings Division