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HQ 086898


August 1, 1990

CLA-2 CO:R:C:G 086898 ALS

CATEGORY: CLASSIFICATION

TARIFF NO.: 7616.90.0080

Mr. R.C. Willette
A.N. Deringer, Inc.
30 West Service Road
Champlain, New. York 12919-9703

RE: Aluminum Slat Packs

Dear Mr. Willette:

This is in response to your letter of April 4, 1990, requesting the classification of a sample pack of aluminum blind slats under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) as well as the applicability of subheading 9802.00.8050 (HTSUSA) thereto.

FACTS:

The submitted sample consists of aluminum slats of two different sizes made from 3000 foot coils of pre-colored and textured aluminum which is shipped from the United States to Canada. Your client slits the coils, cuts to size and shape and prints model, color, etc. on each sample slat swatch. They then punch a hole in the slats which are assembled in a vinyl case with a screw post to form a slat pack. The slat pack, which measures approximately 6 1/2" x 3 1/2" x 1 1/2", is used to obtain orders for U.S. made venetian blinds.

ISSUE:

What is the tariff classification of aluminum slats assembled in a vinyl case with a screw post to form a slat pack?

LAW and ANALYSIS:

Classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's) taken in order. GRI 1 provides that 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 may be applied, taken in order.

In reviewing the headings eligible for classification of these goods, we note that suitable headings may be found in Chapters 42, 48 and 76, HTSUSA. Goods consisting of more than one material or substance are, pursuant to GRI 2(b), to be classified according to the principles of GRI 3. Since each possible heading refers only to a part of the goods and the articles under consideration are made up of different components, they are classifiable according to GRI 3(b). That GRI provides:

Mixtures, composite goods consisting of different materials or made up of different components,...shall be classified as if they consisted of the material or component which gives them their essential character. The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods. As noted in United China and Glass Co, v. United States, 61 Cust. Ct. 386, C.D. 3637, 293 F. Supp. 734 (1968), "In general, 'essential character' has been construed to mean the attribute which strongly marks or serves to distinguish what an articles is; that which is indispensable to the structure, core or condition of the article." While this case stated the standard under the Tariff Schedules of the United States (TSUS), the principle is equally valid under the HTSUSA.

The constituent material which most imparts the essential character to the slat pack is the aluminum which form the slats. Without those slats the pack would not serve its intended purpose. Accordingly, the article is classifiable under the provisions of Chapter 76, HTSUSA, which covers aluminum and articles thereof.

We have considered the applicability of subheading 9802.00.8050, HTSUSA, as requested in your inquiry, which provides a partial duty exemption for articles assembled abroad in whole or in part of fabricated components which are the product of the United States. The subheading further provides that the articles must have been exported in condition ready for assembly without further fabrication, have not lost their physical identity in such articles by change in form, shape, or otherwise, and have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process such as cleaning, lubricating, and painting.

An article entered under subheading 9802.00.8050, HTSUSA, is subject to duty on its full value less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of section 10.24, Customs Regulations (19 CFR 10.24).

Fabricated components subject to the exemption are provided for in section 10.14, Customs Regulations (19 CFR 10.14). Section 10.16(a), Customs Regulations (19 CFR 10.16(a)) discusses the nature of assembly operations and section 10.16(b), Customs Regulations (19 CR 10.16(b)), discusses operations which are considered incidental to the assembly process and are not considered further fabrication operations since they are of a minor nature and cannot always be provided for in advance of the assembly operation.

We believe the operations performed in Canada; slitting of the coils, cutting to size and shape, printing model, color, etc. on the sample swatch, the punching of a hole in the slat to assemble it in a vinyl case, are operations beyond the assembly concept. They are further fabrication and completion steps in manufacturing of the slat pack. Subheading 9802.00.8050, HTSUSA, is, therefore, inappropriate.

We have considered the possible applicability of subheading 9802.00.50, HTSUSA, although you did not specifically request such consideration in your inquiry. That subheading provides for a partial duty exemption for articles returned to the United States after having been exported to be advanced in value or improved in condition by means of repairs or alterations. Such articles are dutiable only on the value of the foreign repairs or alterations, upon compliance with the documentary requirements of section 10.8, Customs Regulations (19 CFR 10.8). However, entitlement to this tariff treatment is precluded where the exported articles are incomplete for their intended use prior to the foreign processing, Guardian Industries Corp. v.United States, 3 CIT 9 (1982), as "repairs and alterations are made to completed articles and do not include intermediate processing operations which are performed as a matter of course in the preparation or the manufacture of finished articles." Dolliff and Company, Inc. v. United States, C.D. 4755, 81 Cust, Ct. 1, 455 F. Supp. 618 (1978), aff'd, C.A.D. 1225, 66 CCPA 77, 599 F. 2d 1015 (1979) (Court's emphasis). Thus, "the focus is upon whether the exported article is incomplete or unsuitable for its intended use prior to the foreign processing." (Guardian, Supra). The operations performed on the coils occur prior to the
completion of the slat pack and are, therefore, excluded from consideration under subheading 9802.00.50, HTSUSA.

HOLDING:

The aluminum sample slat packs are classifiable in subheading 7616.90.0080, HTSUSA, which provides for other articles of aluminum, other, other, other, and are subject to a general rate of duty of 5.7% ad valorem. Goods so classifiable which are of Canadian origin are entitled to a 4.5% ad valorem rate of duty under the United States-Canada Free Trade Agreement (FTA) upon compliance with all applicable regulations

Sincerely,

John Durant, Director
Commercial Rulings Division

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