The tariff classification of roasted peanuts of United States origin that are packaged in plastic bottles in Canada and returned to the United States.

NY G87174 March 20, 2001 CLA-2-20:RR:NC:2:231 G87174 CATEGORY: Classification TARIFF NO.: 2008.11.4500; 2008.11.6000; 9801.00.1097 Mr. Thomas Foster Beer Nuts, Inc. 702 Sussex Circle Vernon Hills, IL 60061 RE: The tariff classification of roasted peanuts of United States origin that are packaged in plastic bottles in Canada and returned to the United States. Dear Mr. Foster: In your letter, dated February 6, 2001, you requested a ruling on the classification of roasted peanuts of United States origin that are packaged in plastic bottles in Canada and returned to the United States. The merchandise is comprised of peanuts of United States origin that are cooked and processed in the United States. Then they are shipped to Canada to be packed in plastic bottles and returned to the United States. The applicable subheading for roasted peanuts, if entered under quota, will be 2008.11.4500, Harmonized Tariff Schedule of the United States (HTS), which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together, peanuts (ground-nuts), other, described in additional U.S. note 2 to chapter 12 and entered pursuant to its provisions. The rate of duty will be 6.6 cents per kilogram. The applicable subheading for roasted peanuts, if entered outside the quota, will be 2008.11.6000, HTS, which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together, peanuts (ground-nuts), other, other. The rate of duty will be 131.8 percent ad valorem. In addition, products classified in subheading 2008.11.6000, HTS, will be subject to additional duties based on their value, as described in subheadings 9904.12.01 – 9904.12.19, HTS. In your correspondence you inquire as to whether the merchandise is entitled to duty free treatment under subheading 9801.00.10, HTS. Subheading 9801.00.10, HTS, provides for the free entry of products of the United States when returned after having been exported, without having been advanced in value or improved in condition by any process of manufacture or other means while abroad, provided the documentary requirements of section 10.1, Customs Regulations (19 CFR 10.1), are met. In United States v. John V. Carr and Sons, Inc., 69 Cust. Ct. 78, C.D. 4377 (1972), aff’d 61 CCPA 52, C.A.D. 1118 (1974), the Court stated that absent some alteration or change in the item itself, the mere repackaging of the item, even for the purpose of resale to the ultimate consumer, is not sufficient to preclude the merchandise from being classified under item 800.00, Tariff Schedules of the United States (the precursor to subheading 9801.00.10, HTS). In HRL 555148, dated March 15, 1990, HQ found that soybean and corn oils that were shipped to Canada, packaged in consumer size bottles, and returned to the United States, qualified for treatment under subheading 9801.00.10, HTS. In HRL 555685, dated August 15, 1990, HQ ruled that American infant formulae shipped to Canada, packaged in consumer size cans, and returned to the United States, were eligible for the duty exemption available under subheading 9801.00.10, HTS. Accordingly, roasted peanuts of U.S. origin that are packaged in plastic bottles in Canada and returned to the United States, are not considered to have been advanced in value or improved in condition for the purposes of subheading 9801.00.1097, HTS. As a result, the roasted peanuts will be exempt from duty under this tariff provision when they are returned to the U.S., provided that the documentation requirements of 19 CFR 10.1 are satisfied. The general rate of duty will be free, and the Merchandise Processing Fee will not apply. Note the documentation requirements in Customs Regulation 10.1 for shipments valued over $2,000. With respect to whether the packing itself will be subject to duty, General Rule of Interpretation 5(b), HTS, states, “…packing materials and packing containers entered with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision does not apply when such packing materials or packing containers are clearly suitable for repetitive use.” In this case, the plastic bottles are of the kind normally used for packing the products are not suitable for reuse. Therefore, the value of the packing is considered a part of the value of its contents and the packing is dutiable at the rate of it contents (in this case, free under 9801.00.1097, HTS). In addition, this product may be subject to requirements imposed by the United States Department of Agriculture, Agricultural Marketing Service (AMS). For additional information regarding AMS requirements, you may contact Mr. Tom Tichenor at (202) 720-6962. If you have any questions regarding the peanut quota, you may contact Ms. Cindy Porter, U.S. Customs Headquarters, Quota Section/Trade Programs at (202) 927-5399. Additional requirements may be imposed on these products by the Food and Drug Administration. You may contact the FDA at: Food and Drug Administration Division of Regulatory Guidance 200 C Street, S.W. Washington, DC 20204 This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Thomas Brady at 212-637-7064. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division