HQ 081576: Decision on Application for Further Review of Protest No. 3001-5-000207.

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                                       HQ 081576

                                     June 30, 1988

            CLA-2 CO:R:CV:G  081576 DC

            CATEGORY: Classification

            TARIFF NO.: 700.35; 700.45

            District Director of Customs
            2039 Federal Office Bldg
            909 First Avenue
            Seattle, Washington  98174

            RE:  Decision on Application for Further Review of Protest No.
                 3001-5-000207.

            Dear Sir:

                 This protest was filed against your decisions in the
            liquidations on April 5, 1985, of entry No. 84-218334-7 dated
            April 2, 1984, entry No. 84-221115-4 dated April 24, 1984, and
            entry Nos. 84-221142-6 and 84-221143-9 dated May 31, 1984.

            FACTS:

                 The above-listed entries covering athletic shoes were
            liquidated under the provision for other footwear in item
            700.95, Tariff Schedules of the United States (TSUS).

                 The protestant maintains that the footwear is in chief
            value of leather which requires its classification as leather
            footwear under item 700.35 or 700.45, TSUS, depending on gender
            and value per pair.

            ISSUE:

                 Is the footwear in chief value of leather as claimed by
            the protestant?

            LAW AND ANALYSIS:

                 The protestant claims that the component material cost
            breakdowns submitted show that the footwear is in chief value
            of leather.  However, our records show that a component
            material breakdown was submitted only with those shoes covered
            by entry No. 84-218334-7.















                                          -2-


                 With respect to those shoes covered by entry No. 84-
            218334-7, we agree with your conclusion that there is no
            tangible evidence that the component material cost breakdown
            showing the shoes to be in chief value of leather is incorrect.

                 In the case of Mitsubishi International Corp. v. United
            States, Slip Op. 87-136 (Ct Int'l Trade, decided December 10,
            1987), the court held that in component material of chief value
            determinations, where the competing provisions do not contain
            the term "rubber or plastics," separate costs for rubber and
            plastics must be broken out for the rubber/plastics components.

                 It is our position that in those instances where no cost
            breakdowns were supplied the shoes will be considered to be in
            chief value of leather if they are invoiced under $7.00 per
            pair.  Due to administrative realities we have presumed for
            several years that athletic shoes in which leather was the base
            material of the upper were in chief value of leather without
            requiring any component breakdown as authorized by section
            141.87, Customs Regulations.  We have always recognized that a
            small percentage of these shoes might not have been in chief
            value of leather under the Customs interpretation in effect.
            However, the burden of requiring the needed breakdowns on the
            tens of millions of pairs that would have been affected greatly
            outweigh the potential of possible duty increase on a small
            percentage of them.  Likewise, we are confident that the
            overwhelming majority of the athletic footwear valued under
            $7.00 per pair in which leather covers more than 50 percent of
            the upper's exterior surface area is in chief value of leather
            when rubber and plastics are considered separate component
            materials.  We have determined that the $7.00 cutoff is
            reasonable because we note that, in the more expensive athletic
            shoes with leather overlays, the extra cost is caused mostly by
            improvements and additional sophistication in the rubber/
            plastic bottom, which is the principal determinant of the
            shoe's suitability for serious athletic use.

                 There were no component material cost breakdowns submitted
            with those shoes covered by entry Nos. 84-221115, 84-221142-6
            and 84-221143-9.  However, inasmuch as these shoes were valued
            at under $7.00 per pair, they are presumed to be in chief value
            of leather in accord with the reasoning set forth in the
            preceding paragraph.

            HOLDING:

                 The footwear involved is classifiable as leather footwear
            under item 700.35 or 700.45, TSUS, depending on gender and
            value per pair.












                                          -3-


                 The protest should be allowed.  A copy of this decision
            should be attached to the Form 19 Notice of Action to be sent
            to the protestant.

                                          Sincerely,




                                          John Durant, Director
                                          Commercial Rulings Division