CLA-2 RR:TC:FC 954847K
Port Director
U.S. Customs Service
200 Granby Street
Norfolk, Virginia 23510
RE: Application For Further Review of Protest No 1404-93-100012;
Fragments of Oriental
Tobacco Leaves
Dear Port Director:
The following is our response to the referral by your
office, dated August 3, 1993, of the request for
further review of the above-referenced protest.
FACTS:
The consumption entries covering the imported merchandise
were liquidated on May 28 and June 11, 1993, under the provision
for other unmanufactured tobacco, partly or wholly
stemmed/stripped, threshed or similarly processed, in subheading
2401.20.80, Harmonized Tariff Schedule of the United States
(HTSUS), with duty at the 1993 general rate of 44.1 cent per kg.
A timely protest under 19 U.S.C. 1514 was received on July 1,
1993. The protestant requested reliquidation of the entry under
the provision for other tobacco refuse (other than stems), in
subheading 2401.30.90, HTSUS, with duty at the 1993 general rate
of 35.5 cent per kg.
In the protest, the protestant referred to a pending court
case involving similar merchandise and we granted the request to
delay a decision pending the outcome of the court case. Counsel
affirmed in a meeting on August 15, 1997, that no further
submissions would be submitted.
The description of the tobacco is more fully described under
Law and Analysis.
ISSUE:
The issue is whether the tobacco has been similarly
processed as in a threshing process.
LAW AND ANALYSIS:
The tobacco which is the subject of this protest is similar
to the tobacco which was the subject of the decision of the
United States Court of International Trade, Philip Morris
Incorporated v. the United States, Slip Op. 95-176, dated October
31, 1995. The decision described the processing of the tobacco
before importation as follows.
Oriental leaf tobacco was transported in bales to a
processing facility where it was manipulated to separate the
"pads" of leaves which had dried together. Tobacco fragments
dropped out of the machines involved in the manipulation process.
Those fragments, as well as other floor sweepings and other
residue, constitute the merchandise as imported. The fragments
are smaller than « inch (1.3cm) in diameter.
The Court noted the facts that (unlike Flue-cured or Burley
tobaccos) Oriental leaf tobacco characterized by a small leaf
with no thick mid-rib, does not require stemming prior to use, it
is not subjected to stemming/stripping of any kind, and that it
is not subjected to a "threshing" process to separate the leaf
from the stem. The Court further noted that subheading
2401.20.80, HTSUS (1992 & 1993), chosen by Customs, requires that
the tobacco be either "partly" or "wholly" stemmed or stripped
and the tobacco was not stemmed or stripped. The Court did not
accept the position that the manipulation process was similar to
a threshing process. The Court concluded that the Customs
classification was incorrect and that the two competing tariff
provision were subheadings 2401.30.90, which provides for other
tobacco refuse, or 2401.10.40, which provides for Oriental or
Turkish type of cigarette leaf, not stemmed/stripped and not over
21.6 cm in length.
The Government (Customs) agreed to stipulate that the
tobacco was classified in subheading 2401.30.90, HTSUS, and, in
accordance with the published stipulation, the decision
represents the current Customs position for classification for
similar merchandise.
We note for informational purposes that all three
subheadings in the tariff discussed above have been changed and
redesignated with free general rates of duties under Presidential
Proclamation 6821, dated September 12, 1995 (effective on
September 13, 1995).
HOLDING:
Imported fragments of Oriental tobacco leaves that dropped
out of machines used to air dry and separate pads of Oriental
tobacco leaves, in which the leaves are not stemmed/stripped or
threshed, are classified as other tobacco refuse, in subheading
2401.30.90, HTSUS, subject to the 1992 general rate of duty of
35.5 cent kg.
You are directed to allow the protest in full.
In accordance with Section 3A(11)(b) of Customs Directive
099 3550-065, Revised Protest Directive, dated August 4, 1993, a
copy of this decision attached to Customs Form 19, Notice of
Action, should be provided by your office to the protestant no
later than 60 days from the date of this decision and any
reliquidations of entries in accordance with this decision must
be accomplished prior thereto. Sixty days from the date of this
decision the Office of Regulations and Rulings will take steps to
make this decision available to Customs personnel via the Customs
Rulings Module in ACS and the public via the Diskette
Subscription Service, Freedom of Information Act and other public
access channels.
Sincerely,
John Durant, Director
Tariff Classification
Appeals Division