Applicability of duty exemption to a medicinal in single-use syringes imported for free distribution to physicians as samples to solicit orders for foreign-made products

HQ W556903 December 31, 1992 CLA-2 CO:R:C:S W556903 RA CATEGORY: Classification TARIFF NO.: 9811.00.60 Mr. Charles Arnone Assistant Director International Distribution ICI Americas, Inc. Wilmington, Delaware 19897  RE: Applicability of duty exemption to a medicinal in single-use syringes imported for free distribution to physicians as samples to solicit orders for foreign-made products Dear Mr. Arnone: This is in response to your letter of September 1, 1992, requesting a ruling on the free entry of a medicinal contained in syringes which will be imported in bulk to be given to doctors as samples after the pouches in which they are imported are marked “Not for Retail Sale” in this country.FACTS: You state that the proposed importations will consist of a single-use syringe containing an anti-cancer drug which is packaged in the United Kingdom. The syringes, which will be marked abroad with the lot number and expiration date, will be imported in bulk in individual pouches. When they are received in your American plant, a label will be affixed to the pouch with lot number, product name and a notation that it is not for retail sale. Each pouch will then be placed in an outer package which also will be marked "Not for Retail Sale." You enclosed a sample of the pouch and syringe for our examination. You advised a member of my staff by telephone that the samples would be va-.iued at more than $1._,. ISSUE: Q_() Whether the medicinal contained in a single-use syringe is entitled to duty-free treatment under subheading 9811.00.60, Harmonized Tariff Schedule of the United States (HTSUS), as samples for soliciting orders for foreign products.  - 2 - LAW AND ANALYSIS: Subheading 9811.00.60, HTSUS, provides for the free entry of any sample valued not over $1.00 each, or marked, torn, perforated, or otherwise treated so that it is unsuitable for sale or for use otherwise than as a sample, to be used in the U.S. only for soliciting orders for products of foreign countries. The controlling factor is whether the importer uses the samples for the purpose of soliciting purchase orders for foreign merchandise and the creation of demand for future orders. In Carson M. simon & co, v, united states, 46 Cust. Ct. 118, C.D. 2243 (1961), the court considered the legislative history of the predecessor provision to subheading 9811.oo. 60, HTSUS, and concluded that sample goods must be used after importation to solicit orders for products of foreign countries. The court stated that: ...with respect to samples of nominal value, or so treated as to have no other use than in the solicitation of orders for merchandise, the conditions of ...[the statute] are met if the samples represent the goods to be ordered, and the goods have been produced in a foreign country. Based on the information you have provided, it is evident that the imported medicinal is not of nominal value and is not, at the time of importation, marked or otherwise treated to render it "unsuitable for sale or for use otherwise than as a sample." Therefore, under these circumstances, because the requirements of the statute would not be satisfied, the syringes containing the medicinal cannot qualify for duty-free treatment under subheading 9811.00.60, HTSUS. HOLDING: Imported syringes containing medicinals which are valued at more than one dollar each and are not marked or treated at the time of importation to ensure use only as samples for soliciting orders for foreign products do not qualify for free entry under subheading 9811.00.60, HTSUS. Sincerely, John Durant, Director Commercial Rulings Division