The tariff classification of pressure sensitive circular shapes from Mexico

N100860 May 4, 2010 CLA-2-39:OT:RR:NC:N4:421 CATEGORY: Classification TARIFF NO.: 3919.90.5060 Ms. Karia Herrera Richard L. Jones Calexico Inc. 8830 Siempre Viva Road, Suite 100 San Diego, CA 92154 RE: The tariff classification of pressure sensitive circular shapes from Mexico Dear Ms. Herrera: In your letter dated April 6, 2010, on behalf of Nistem Precision Inc., you requested a tariff classification ruling. The sample submitted with your request consists of two flat pressure sensitive circular shapes measuring 16 inches in diameter made of clear polyethylene plastic sheeting that is 3 mils in thickness. The shapes are packaged on silicone coated paper release liner. The shapes are available in three dimensions. Article AUTO15SNCROLL consists of circles measuring 15 inches in diameter. Article AUTO16SVAROLL consists of circles measuring 16 inches in diameter. Article AUTO18SVBROLL consists of circles measuring 18 inches in diameter. The circles are made from rolls of pressure sensitive plastic sheeting manufactured in Japan that are imported into the United States and then sent to Mexico for further processing. The processing in Mexico includes unrolling the film, press cutting the adhesive film with a die to form circular shapes, and then removing the excess plastic film from around the circles, leaving the paper release liner intact. A kiss cutting process controls the depth of the die strike so that the die cuts up to the release liner but not through it. The release paper with the attached circles is rewound and shipped back to the United States. The samples are being returned as you requested. The applicable subheading for the pressure sensitive circular shapes will be 3919.90.5060, Harmonized Tariff Schedule of the United States (HTSUS), which provides for self-adhesive plates, sheets, film, foil, tape, strip and other flat shapes, of plastics, whether or not in rolls: other: other…other. The general rate of duty will be 5.3 percent ad valorem. You ask whether the pressure sensitive circular shapes are eligible for treatment in subheading 9802.00.5060 of the Harmonized Tariff Schedule of the United States (HTSUS). Subheading 9802.00.5060, HTSUS, provides a partial duty exemption for articles returned to the United States after having been exported to be advanced in value or improved in condition by means of repairs or alterations. Articles entitled to this partial duty exemption are dutiable only upon the cost or value of the foreign repairs or alterations, provided the documentary requirements of section 10.8, Customs Regulations (19 CFR 10.8), are satisfied. The application of this tariff provision is precluded in circumstances where the operations performed abroad destroy the identity of the articles or create new or commercially different articles. See A.F. Burstrom v. United States, 44 CCPA 27, C.A.D. 631 (1957); Guardian Industries Corporation v. United States, 3 CIT 9 (1982). Treatment under subheading 9802.00.5060, HTSUS, is also precluded where the exported articles are incomplete for their intended use and the foreign processing operation is a necessary step in the preparation or manufacture of the finished article. Alterations are made only to completed articles and do not include intermediate operations which are performed in the manufacture of finished articles. See Dolliff and Company, Inc. v. United States, 66 CCPA 77, C.A.D. 1225, 599 F.2d 1015 (1979). Cutting the lengths of pressure sensitive sheeting to form circular shapes produces such changes in characteristics and use as to exceed an alteration and create a commercially different article. Moreover, the exported sheet is incomplete for its intended use and the cutting to circular shape is a necessary step in the manufacture of the imported merchandise. Accordingly, the imported pressure sensitive circular shapes are not eligible for tariff treatment under the provisions of item 9802.00.5060, HTSUS, and would be subject to duty on the full value. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/. 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 Joan Mazzola at (646) 733-3023. Sincerely, Robert B. Swierupski Director National Commodity Specialist Division