The applicability of subheading 9801.00.10 to Live Plants with Decorative Planters

N298515 July 27, 2018 CLA-2-98:OT:RR:NC:2:231 CATEGORY: Classification TARIFF NO.: 9801.00.1098 Ms. Darlene DiBernardo A.N. Deringer, Inc. 173 West Service Road Champlain, NY 12919 RE: The applicability of subheading 9801.00.10 to Live Plants with Decorative Planters Dear Ms. DiBernardo: In your letter dated June 27, 2018, on behalf of your client, Fernlea Flowers Ltd (Ontario, Canada), you requested a ruling on whether various plants and planters were eligible for duty-free treatment under subheading 9801.00.1098, Harmonized Tariff Schedule of the United States (HTSUS). The subject merchandise is described as plants in containers of United States origin. The items consist of plants of varying species grown in the United States and plastic containers sourced from China. The goods are put together in the United States and are a complete item, ready for sale upon time of export. These are exported to Canada from the United States for cost and logistic reason and returned without being advanced in value. The plants, growing medium and containers will not be advanced in value or improved in condition by manufacture while in Canada. The plants will be watered to keep them alive. The act of watering the plant would not be considered an advancement in value or improved in condition by manufacture. However, if stored for a long period of time, if fertilizer is used to maintain its condition during such time, this act may be considered an advancement in value and improved condition of the plants that are to be exported to the United States. Accordingly, the plants may not be entitled to classification under subheading 9801.00.10. You state that the time frame for which the items are shipped to Canada and subsequently returned to the United States is usually greater than two days. The goods will imported into the United States within three years after having been exported to Canada. Section 904(b) of the Trade Facilitation and Trade Enforcement Act of 2015 (Pub. L. 114-125, February 24, 2016) amended subheading 9801.00.10, HTSUS, to include any products which are returned within 3 years after having been exported. Previously, subheading 9801.00.10, HTSUS, only applied to products of the United States. Subheading 9801.00.10, HTSUS, now provides for the duty-free treatment of: Products of the United States when returned after having been exported, or any other products when returned within 3 years after having been exported, without having been advanced in value or improved in condition by any process of manufacture or other means while abroad.Section 10.1, Customs Regulations (19 C.F.R. § 10.1), sets forth the documentary requirements for entry under subheading 9801.00.10, HTSUS. We note that CBP has not yet amended the regulations to implement the change to subheading 9801.00.10, HTSUS. Nonetheless, while portions of the regulations are no longer pertinent, some portions of 19 C.F.R. § 10.1 still remain valid. For example, 19 C.F.R. § 10.1(a)(1) requires the foreign shipper to declare the following information with regard to articles in a shipment valued over $2,500: the port of exportation, the date of exportation, the quantity, the description of the merchandise, the value of the merchandise, the date of the declaration, and whether the articles were advanced in value or in condition by any process of manufacture or other means. Under 19 C.F.R. § 10.1(b), the port director may require such other documentation or evidence as may be necessary to substantiate the claim for duty-free treatment including a U.S. export invoice, bill of lading or airway bill evidencing the exportation of the articles from the United States, and/or the reason for the exportation of the articles demonstrating that the same items were returned within 3 years. Section 10.1(a)(2), Customs Regulations (19 C.F.R. § 10.1(a)(2)), requires the owner, importer, consignee, or agent having knowledge of the facts regarding the claim for free entry to declare that the foreign shipper’s statement is true; that the articles were not manufactured or produced in the United States under subheading 9813.00.05, HTSUS; and, that the articles were exported without benefit of drawback. Therefore, provided the party (Fernlea Flowers Ltd) re-importing the plants and containers is an “owner, importer, consignee, or agent having knowledge of the facts regarding the claim for free entry” as required by 19 C.F.R. § 10.1(a)(2), then such party may re-import the plants and containers under subheading 9801.00.10, HTSUS.Regarding the applicability of heading 9801, HTSUS, if the importation of the plants meets the criteria set forth in the cited regulation, the merchandise may be eligible for duty exemption under subheading 9801.00.1098, HTSUS. As noted in ruling N295026, the pots will be entered separately from the plants. 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 the World Wide Web at https://hts.usitc.gov/current. This merchandise may be subject to regulations or restrictions administered by the U.S. Department of Agriculture, Animal and Plant Health Division (APHIS). You may contact that agency regarding possible applicable regulations at the following location: U.S. Department of Agriculture APHIS Plant Protection and Quarantine Permit Unit 4700 River Road, Unit 136 Riverdale, MD 20737-1236 Telephone number: 877-770-5990 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 Ekeng Manczuk at ekeng.b.manczuk@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division