Application for Further Review of Protest No. 4701-16-100230; Generalized System of Preferences; Request for Refund of Duties Paid

HQ H288073 September 5, 2017 OT:RR:CTF:VS H288073 RMC CATEGORY: Classification Port Director U.S. Customs & Border Protection John F. Kennedy International Airport, Building 77, 2nd Floor Jamaica, NY 11430 Re: Application for Further Review of Protest No. 4701-16-100230; Generalized System of Preferences; Request for Refund of Duties Paid Dear Port Director: This is in response to the Application for Further Review (“AFR”) of Protest No. 4701-16-100230, timely filed by Cowan, Liebowitz & Latman, P.C. on behalf of the importer, Jansy Packaging LLC (“Jansy”). The AFR concerns whether goods are eligible for preferential tariff treatment under the Generalized System of Preferences (“GSP”). FACTS: The merchandise at issue is peppermint chewing gum. Entry was made at John F. Kennedy International Airport on June 1, 2016. The merchandise was classified under subheading 2106.90.9985, Harmonized Tariff Schedule of the United States (“HTSUS”), and no claim for preferential treatment under the GSP was made at the time of entry. The entry liquidated as entered on April 15, 2016. In its timely protest, Jansy claims that it failed to request preferential tariff treatment under the GSP at entry because of an administrative oversight. Jansy thus seeks a refund of duties paid on the subject entry. As for the merchandise’s eligibility for GSP preferential tariff treatment, Jansy states that the goods were imported directly into the United States as required by the GSP regulations. See 19 C.F.R. § 10.175. Although the merchandise was not shipped directly from Tunisia to the United States, Jansy states that the merchandise nonetheless was “imported directly” within the meaning of 19 C.F.R. § 10.175 because they traveled by truck and ferry from Tunisia to the Amsterdam in bond, after which they were loaded onto a plane destined for John F. Kennedy International Airport in New York. According to counsel for Jansy, the chewing gum was “constructed entirely of raw materials processed in Tunisia.” However, no information was provided with the protest to substantiate that the goods were produced in Tunisia exclusively from originating materials. To confirm the GSP eligibility of the merchandise, this office requested information on July 11, 2017, including: a specific description of the goods; manufacturing process flow chart, narrative, and description; a bill of materials indicating the originating status of each material; a statement that the bill of materials is complete; and an affidavit from the manufacturer attesting to the originating status of each material. Jansy did not provide the requested information. ISSUE: Whether the chewing gum is eligible for preferential tariff treatment under the GSP. LAW AND ANALYSIS: Under the GSP, eligible articles grown, produced, or manufactured in a designated beneficiary developing country (“BDC”), which are imported directly into the customs territory of the United States from a BDC, may receive duty-free treatment if the sum of (1) the cost or value of materials produced in the BDC, plus (2) the direct costs of the processing operations performed in the BDC, is equivalent to at least 35 percent of the appraised value of the article at the time of entry into the United States. See 19 U.S.C. § 2463(a)(2)(A). Here, Tunisia is a designated BDC for GSP purposes. See General Note 4(a), HTSUS. In order to qualify for preferential tariff treatment under the GSP, the merchandise at issue thus must have been “imported directly” to the United States and meet the 35 percent value-content requirement. Even assuming that the goods meet the “imported directly” requirement, however, no evidence was provided with the protest to demonstrate that the merchandise meets the 35 percent value-content requirement. Counsel claims that the merchandise was “constructed entirely of raw materials processed in Tunisia” but did not specify what the raw materials were or substantiate where they came from. U.S. Customs and Border Protection has reserved the right to verify claims for preferential tariff treatment under the GSP, which was exercised in this case by requesting information about the origin of the goods. See 19 C.F.R. § 10.173(c). Because no information on origin has been provided either with the protest or in response to our inquiry, the merchandise is not eligible for preferential tariff treatment under the GSP. HOLDING: The protest should be denied. The chewing gum is ineligible for preferential tariff treatment under the GSP. In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP website at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution. Sincerely, Myles B. Harmon, Director Commercial and Trade Facilitation Division