CLA-2 RR:TC:FC 958920 ALS
Port Director of Customs
P.O. Box 3130
Lincoln-Juarez Bridge, Building 2
Laredo, TX 78044-3130
RE: Request for Further Review of Protest No. 2304-95-100200, dated October 30, 1995, Concerning Multiple Entries of Frozen Strawberries in Plastic Buckets, Imported from Mexico
Dear Mr. Pitts:
This ruling is on a protest that was filed against your
decisions of August 4 & 11, 1994, in the liquidation of multiple
entries covering frozen strawberries in plastic buckets (also
referred to as plastic pails).
FACTS:
The entries under consideration cover frozen strawberries,
with added sugar of less than 25 percent by weight put up in
plastic buckets. An invoice and entry furnished with the protest
indicates that the cost of the plastic buckets was listed
separately therein. The strawberries and the plastic buckets are
of Mexican origin. The importer claims that the plastic buckets
are separately dutiable pursuant to General Rules of
Interpretation (GRI) 5(b) because they are "clearly suitable for
repetitive use."
ISSUE:
What is the classification of frozen strawberries imported
in plastic buckets? Are plastic buckets separately dutiable from
their contents?
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LAW AND ANALYSIS:
Classification of merchandise under the Harmonized Tariff
Schedule of the United States Annotated (HTSUSA) is governed by
the GRI's taken in order. GRI 1 provides that the classification
is determined first in accordance with the terms of the headings
and any relative section and chapter notes. If GRI 1 fails to
classify the goods and if the headings and legal notes do not
otherwise require, the remaining GRI's are applied, taken in
order.
In reviewing the documents of record we noted that the
importer and Customs at the port of entry agreed that the frozen
strawberries were classifiable in subheading 0811.10.0050,
HTSUSA. We note that the issue at hand is essentially the same
as that presented in Headquarters Ruling Letter (HRL) 957800,
dated August 14, 1995, i.e., the dutiability of the plastic
buckets.
The principal question raised in the protest is whether the
plastic buckets in which the strawberries are imported meet the
requirements of GRI 5(b) and are, therefore, separately dutiable.
This rule provides, as herein pertinent, that packing materials
and packing containers presented with the goods therein shall be
classified with the goods if they are of a kind normally used for
packing such goods. It further provides that this rule is not
binding when such packing materials or packing containers are
clearly suitable for repetitive use. Thus, the question is
whether the plastic buckets in the instant case are the type of
container normally used for packing strawberries and whether the
containers are "clearly suitable for repetitive use". There is
no dispute as to the buckets being a "normal" container for
frozen strawberries. Their suitability for repetitive use is at
issue.
In considering this matter we note that in HRL 084068, dated
July 21, 1989, we held that the term "repetitive use" was
understood to have the same meaning as the term "reuse" under the
Tariff Schedules of the United States Annotated (HTSUSA). That
ruling held that the term meant repetitive use in the practical,
commercial sense, and the use must be for commercial shipping and
transportation of the kind of goods presented in the packing
container.
The term "repetitive use" is to be construed as demanding
more than just the possibility of repetitive use. The fact that
the container may be used for alternative purposes, e.g., trash - 3 -
can, storage bin, does not satisfy this requirement. (See HRL
088170, dated February 20, 1991 and HRL 089527, dated August 12,
1991).
Although the importer claims that the buckets are intended
for repetitive use and has submitted a letter from an ultimate
consignee to that effect, we do not believe that the use by one
consignee confirms that the buckets are "clearly suitable for
repetitive use" and that this is the usual course of trade. In
this regard, we note that a letter from another ultimate
consignee indicates that the plastic buckets may be re-used,
apparently for a variety of purposes, or are sold to be re-used
or recycled by other companies. We believe that the situation is
essentially the same as that found in HRL 957800 where we noted
that there was no support for the practical, commercial,
repetitive use of the buckets for commercial shipping and
transportation of the kind of goods presented in the packing
containers. In fact, the broker in the instant case notes that
after "the strawberries are sent to production, the pails still
in good condition are sold, either to other vendors, or to
companies which have some use for them." (See HRL's, supra,
regarding the meaning of the term "repetitive use" and the use of
the container for alternative purpose).
Based on the above, we have concluded that the plastic
buckets containing the strawberries are of a kind normally used
for packing such goods, but they are not clearly suitable for
repetitive use as required by GRI 5(b). Therefore, they are
dutiable with their contents.
Information which became available to this office subsequent
to initiation of the further review process, indicates that some
buckets used as packing containers for the imported strawberries
may be, in some cases, of U.S. origin. Such buckets may be
eligible for duty free entry under the provisions of heading
9801.00, HTSUSA, upon establishment of their origin and upon
compliance with appropriate Customs regulations. However, Since
the broker has indicated that all the buckets in the protested
entries are of Mexican origin, we have not further considered the
possible eligibility of the buckets for duty free entry under
that heading.
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HOLDING:
Frozen strawberries imported in plastic buckets and
containing less than 25 percent by weight of sugar are
classifiable in subheading 0811.10.0050, HTSUSA, and are subject
to a general rate of duty of 13.5 percent ad valorem. The
plastic buckets in which the strawberries are imported are
dutiable with their contents.
Frozen strawberries in plastic buckets, which are both the
products of Mexico, are eligible for preferential treatment under
NAFTA pursuant to General Note 12(b)(iii), HTSUSA.
Since the rate of duty under the classification indicated
above is the same as the liquidated rate, you are instructed to
deny the protest in full.
A copy of this ruling should be attached to the Customs Form
19 and provided to the protestant as part of the notice of action
on the protest.
In accordance with Section 3A(11)(b) of Customs Directive
099 3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, this decision should be provided by your office to the
protestant no later than 60 days from the date of this letter.
Any reliquidation of the entry in accordance with this decision
must be accomplished prior to the mailing of the decision. Sixty
days from the date of the decision the Office of Regulations and
Rulings will take steps to make the 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