Dutiable status of U.S.-origin wool which is returned to the U.S. after having been scoured, dried, and baled in Mexico

HQ 556227 December 23, 1991 CLA-2 CO:R:C:S 556227 SER CATEGORY: Classification Charles E. Stokes, Jr. Stokes Brothers & Co. 8415 Fredericksburg Road #704 San Antonio, TX 78229-3304 RE: Dutiable status of U.S.-origin wool which is returned to the U.S. after having been scoured, dried, and baled in Mexico Dear Mr. Stokes: This is in reference to your letter of August 19, 1991, concerning the dutiability of U.S.-origin sheepswool which is returned to the U.S. after having been exported to Mexico to be scoured, dried, and baled. FACTS: You state that U.S.-origin sheepswool would be exported to Mexico for scouring, drying, and baling. Each truckload of wool would be separately scoured and documented. On occasion, foreign wool also would be scoured in Mexico, but at no time would there be any commingling of the foreign wool with the U.S.-origin wool. ISSUE: What is the dutiable status of the wool when returned to the U.S.? LAW AND ANALYSIS: U.S. Note 2(a), subchapter II, Chapter 98, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), provides: "...any product of the United States which is returned after having been advanced in value or improved in condition abroad by any process of manufacture or other means, ...shall be treated for the purposes of this Act as a foreign article, and, ...shall be dutiable, except as otherwise prescribed in this part, on its full value...." n -2- Because the operations of scouring, drying, and baling in Mexico clearly will advance in value and improve in condition the U.S.-origin wool, the wool will be fully dutiable at the rate specified in the applicable tariff provision. Based on the limited information provided it appears that the returned scoured wool is properly classified in Heading 5101, HTSUSA (copy enclosed). HOLDING: U.S.-origin wool exported to Mexico where it is scoured, dried, and baled is considered to have been advanced in value and improved in condition and, therefore, will be fully dutiable when returned to the U.S. Sincerely, John Durant, Director Commercial Rulings Division Enclosure