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HQ 086920

July 17, 1990

CLA-2:CO:R:C:G 086920 SER


Mr. John M. Peterson
Neville, Peterson & Williams
39 Broadway, Suite 2201
New York, NY 10006

RE: "Suitable for medicinal use"

Dear Mr. Peterson:

This is in reference to your request for a clarification of the definition of the term "suitable for medicinal use," which appears in subheading 2918.21.1000 of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). You suggest that the Customs Service should adopt a standard for what is "suitable for medicinal use" based on whether a substance is of U.S.P. grade. You state that under the Tariff Schedules of the United States (TSUS), the standard "suitable for medicinal use" was generally met when a substance was of U.S.P. grade, but note that the fact that a substance was of U.S.P. grade did not per se demonstrate that it was "suitable" for use as a medicinal preparation or a drug. This standard was helpful in demonstrating that the product may be practically fit or commercially acceptable for a medicinal use. You state that it would be more convenient to have the standard strictly based on the designation of U.S.P. or technical grade.

As you note in your brief, the courts have created a relatively well-defined standard on what is "suitable for use." Though these decisions were based on provisions in earlier tariffs, it is Customs position that, absent a significant change in the nomenclature in the HTSUSA, decisions under prior tariff law are given appropriate weight on a case-by-case basis in making determinations in the HTSUSA. This is supported by the House Conference Report, NO. 100-576 to the Omnibus Trade and Competitiveness Act of 1988 (P.L. 100-418), p.549-550, in which the conference committee stated, ". . . on a case-by-case basis prior decisions should be considered instructive in interpreting the HTS, particularly where the nomenclature previously interpreted in those decision remains unchanged and no dissimilar interpretation is required by the text of the HTS."

We do not disagree with you that the courts have ruled uniformly and repeatedly that the term "suitable for use" means "actually, practically and commercially fit" for such use. United States v. Amerman & Paterson, et al., 9 Ct. Cust. Appls. 244 (1919). In interpreting this term, in the absence of contrary indications, there is little reason to deviate from the common and commercial understanding of this term as was used under the TSUS. There is also no compelling reason potentially to expand the scope of "suitable for medicinal use" to include all substances that are of U.S.P. grade.

Because there is no actual case under consideration here, it is not necessary for us to conjecture as to exactly which substances are of U.S.P. grade and at the same time are not suitable for medicinal use. It does appear reasonable, however, to note with respect to salicylic acid that because U.S.P. grade salicylic acid is actually, practically, and commercially fit for medicinal use, it will be classified in the subheading reserved for this acid and its salts "suitable for medicinal use." This is so, regardless of the intermediate or additional uses that might be made of it. Moreover, whether the product is classified in subheading 2918.21.1000 or in 2918.21.5000, HTSUSA, would ordinarily be determined by the condition of the goods as imported, and not by any reference to the product's actual use after importation.

This letter is being issued as an information letter under 177.1(d)(2) of the Customs Regulations (19 CFR 177.1(d)(2)), because the classification decision on the prospective transaction has already been issued and neither your client nor the Customs Service proposes any change to it, and because the matter under consideration here is a well-established interpretation or principle of Customs law, the knowledge of which may benefit your client. Also this letter provides the information that our ruling of April 27, 1988 (New York Ruling Letter 829436) was not intended to be understood to equate all U.S.P.-listed products as suitable for medicinal use. As an information letter, as defined by our regulations, this letter carries no value as precedent and does not bind the Customs Service in subsequent rulings or decisions in any way.


John Durant, Director
Commercial Rulings Division

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