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HQ 223082

May 13, 1991

CON-9-04-CO:R:C:E 223082 TG

P.B. McDonald
Eveready Division
Ralston Purina Canada Inc.
5880 Falbourne St.
Mississauga, Ontario L5R 3L8

Dear Mr. McDonald:

This is in response to your letter dated March 18, 1991, requesting a ruling on the temporary importation under bond (T.I.B.) of electrolytic manganese dioxide.

According to your letter, you intend to import 200,000 lbs. of electrolytic manganese dioxide (E.M.D.) on T.I.B. entries for a heat-treating process. This material is purchased from Mitsubishi Canada Ltd. and is of Japanese origin, classified under subheading 2820.10.00 of the Harmonized Tariff Schedule (HTS), and would be imported into the U.S. by Eveready Canada Inc.

You describe this heat-treating process as follows: The E.M.D. is heat-treated in a large rotary dryer at temperatures exceeding 500ΓΈ F, for several hours. This process alters the fundamental crystal structure of the E.M.D. from a gamma to a rho phase. The purpose of the heat-treated E.M.D. is to produce an E.M.D. that compared to a non heat-treated E.M.D. provides significantly higher service on low drain tests to low voltage cut-offs. The E.M.D. will be used in the manufacture of buoylite batteries at your Walkerton, Ontario, Canada plant. These buoylite batteries are purchased by both the U.S. and Canadian Coast Guard. This heat-treating process is only available from Eveready Battery Company, Inc., at its plant in Marietta, Ohio.


Under subheading 9813.00.05, HTS, articles to be repaired, altered or processed (including processes which result in articles manufactured or produced in the United States) may be entered duty-free, temporarily, under bond for their exportation within one year from the date of importation unless an extension for one or more additional periods, which when added to the initial period does not exceed three years, is granted by the district director.

From the description of the operation given, all indications are that a process takes place. However, you must meet all of the accountability requirements under the U.S. Notes of Subchapter XIII, HTS. In particular, subheading 9813.00.05, HTS, U.S. Note 2(b) states that if any processing of such merchandise results in an article manufactured or produced in the United States: (i) a complete accounting will be made to the Customs Service for all articles, wastes and irrecoverable losses resulting from such processing; and (ii) all articles and valuable wastes resulting from such processing will be exported or destroyed under customs supervision within the bonded period; except that in lieu of the exportation or destruction of valuable wastes, duties may be tendered on such wastes at rates of duties in effect for such wastes at the time of importation.

The applicable Customs regulations may be found at 19 CFR 10.31 through 10.40. Section 10.31(f) states that a bond shall be given on Customs Form 301 in an amount equal to double the duties which it is estimated would accrue (or such larger amount as the district director shall state in writing to the entrant is necessary to protect the revenue) had all the articles covered by the entry been entered under an ordinary consumption entry. The basis for the computation of the amount of a temporary importation bond is estimated duties determined in accordance with sections 141.90 and 141.103 of the Customs Regulations (19 CFR 141.90 and 19 CFR 141.103). To this amount is added any other duties that the district director ascertains may become due on the articles so entered and, as well, estimated expenses of reimbursable supervision such as may arise, for instance, when the articles are not properly marked. Estimated antidumping duties are properly added under this provision. Thus, the district director would allow for additional duty which might accrue by reason of the Antidumping Act in computing the amount of the bond when the merchandise is entered. See, Headquarters Letter CON-9-R:CD:D JL 201949 (September 26, 1974).


Entry is permitted in this case under a temporary importation under bond as a process under subheading 9813.00.05, HTS. The importer must meet all of the accountability requirements under the U.S. Notes of Subchapter XIII to the satisfaction of the District Director. The antidumping duties should be treated as duties for the purpose of setting the bond amount.

John Durant, Director
Commercial Rulings Division

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