CLA-2 CO:R:C:T 950029 HP
Mr. Nicholas R. Devine
Assistant District Director
Commercial Operations
U.S. Customs Service
Patrick V. McNamara Building
477 Michigan Avenue
Detroit, MI 48266
RE: Further Review of Protest Number 3801-0-003214
Dear Mr. Devine:
This is in reply to your Memorandum of July 26, 1991,
forwarding Application for Further Review of Protest Number 3801-
0-003214. Please reference CLA-2-CO:CT ML P0003214/TXTFRISC.
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 restrain 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.
All of the components of the Assemblies
were produced in Canada. A Shipper's
Declaration of Canadian Origin was filed with
the entries.
Importer attempted to enter the merchandise subject to this
PRD as follows:
Knotted made up net under subheading 5608.19.2090,
HTSUSA, as other made up nets, free of duty under the
APTA or dutiable under the CFTA at 8 percent ad
valorem. Customs agreed with the tariff subheading,
but disallowed duty reduction under either Agreement.
Thread, under subheading 5204.19.0000, HTSUSA, as other
cotton sewing thread. Customs disagreed, classifying
it under subheading 5401.10.0000, HTSUSA, as sewing
thread of man-made fibers.
Labels, under subheading 8708.29.00, HTSUSA, as
automobile parts. Counsel now claims classification
under subheading 4821.10.4000, HTSUSA, as articles
similar to registers, account books, order books, and
receipt books.
ISSUE:
Whether the thread and net are considered automobile parts
under the HTSUSA? If not, whether any 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).
Clearly, if a completed net would not be classified as an
automobile part, items intended to be made up to form that net
also would not be so classified.
Counsel failed to provide a rationale for its thread
classification in Chapter 52 and labels classification in Chapter
48, HTSUSA, argument. No samples were submitted. Section
174.25, Customs Regulations, (19 C.F.R. 174.25), requires that
an application for Further Review of a Protest must include "(3)
[a] statement of facts or additional legal arguments ... upon
which the party relies...." Therefore, since counsel did not
submit a complete description or argument so as to allow us to
review tariff classification de novo, we will afford the
appraised classifications a presumption of correctness.
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.
HOLDING:
As a result of the foregoing, the instant merchandise is
classified as follows:
Knotted Net
... 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.
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 5807.10.1020, HTSUSA, textile
category 669, as labels, badges and similar articles of
textile materials, in the piece, in strips or cut to
shape or size, not embroidered, woven, labels, of man-
made fibers. The applicable rate of duty is 9 percent
ad valorem.
You are instructed to Deny the protest in full. A copy of this
decision should be attached to the Form 19 Notice of Action.
Sincerely,
John Durant, Director
Commercial Rulings Division