HQ 555085: Applicability of partial duty exemption of item 806.20, TSUS, to glass rectangles exported to Japan to be cut, ground and polished

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 555085
                                    September 27, 1988

            CLA-2  CO:R:C:V  555085 DBI

            CATEGORY:  Classification

            TARIFF NO.:  9802.00.40; 806.20

            Mr. Norbert T. Rogers
            Corporate Transportation and Distribution
            Corning Glass Works
            Corning, New York  14831

               RE:   Applicability of partial duty exemption of item
                     806.20, TSUS, to glass rectangles exported to Japan
                     to be cut, ground and polished

            Dear Mr. Rogers:

               This is in response to your letter of April 18, 1988, to the
            Customs Area Director of the New York Seaport, in which you
            requested a ruling concerning the applicability of item 806.20,
            Tariff Schedules of the United States (TSUS), to glass
            rectangles exported to Japan to be cut, ground and polished and
            imported by your company.  Your letter was referred to this
            office for review and a ruling.

            FACTS:

               You advise that glass drawn at a U.S. plant will be sent to
            Japan in sheets measuring 36" x 31.2".  In Japan, the glass
            will be cut to size and shape to form rectangles measuring 6" x
            6".  The edges of the rectangles will be ground, the corners
            will be cut (edged or beveled) and the surface of each
            rectangle will be lightly polished.

               In meetings and telephone conversations with Import
            Specialists in New York, you explained that these products
            ultimately will be used in small computers, calculators and
            similar machines to form the window portions of these machines.
            When imported into the U.S., the glass will not be ready to be
            installed in a machine.  The glass rectangles will be further
            cut and shaped in the U.S. before being used.  However, the
            processing performed in Japan brings the merchandise very close
            to its final functional state and are crucial operations in the
            manufacture of the glass products.  Samples are submitted for
            examination.

















                                         - 2 -


            ISSUE:

               Whether the described glass rectangles, when returned to the
            U.S., will be eligible for the partial duty exemption in item
            806.20, TSUS (9802.00.40, Harmonized Tariff Schedule of the
            United States (HTSUS)).

            LAW AND ANALYSIS:

               Item 806.20, TSUS, provides for the assessment of duty on
            the value of repairs or alterations performed on articles
            returned to the U.S. after having been exported to be advanced
            in value or improved in condition by any process of manufacture
            or other means.  However, 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, Slip Op. 82-4
            (Jan. 5, 1982).  Item 806.20, TSUS, treatment also is 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 finished articles.  Dolliff
            and Company, Inc. v. United States, 66 CCPA 77, C.A.D. 1225,
            599 F.2d 1015 (1979).

               In the present case, we believe that the foreign cutting to
            size and shape constitutes an operation that exceeds a repair
            or alteration.  The glass sheets that are shipped to Japan for
            processing are commercially different from the glass rectangles
            that return.  The imported glass rectangles have been specially
            prepared to be specifically cut to fit into windows for small
            computers and calculators and similar machines.

               Additionally, the glass rectangles are not finished articles
            completed for their intended use and sent to Japan merely for
            alterations or repairs.  On the contrary, the glass is cut to
            size and shape, ground and polished, which are all necessary
            steps in the preparation of the finished window portions of
            small machines.  





















                                         - 3 -



               The glass rectangles are classifiable under subheading
            7006.00.4050, HTSUS, as glass of heading 7005 (which provides
            for ground or polished glass), bent, edgeworked or otherwise
            worked, other:  other.  This is the classification under the
            HTSUS, which is effective January 1, 1989, and is subject to
            changes made to the statute before the effective date.

            HOLDING:

               On the basis of the information and samples submitted, it is
            our opinion that the foreign cutting to size and shape and the
            other operations may not be considered an alteration as that
            term is used in item 806.20, TSUS.  Consequently, it does not
            appear that item 806.20, TSUS, or any other Schedule 8
            provision providing for a reduction in duty would be applicable
            to the returned glass rectangles.

                                      Sincerely,





                                       John Durant
                                       Director, Commercial
                                       Rulings Division

            cc: Chief, National Import Specialist Branch 3
                New York Seaport (CLA-2-70:S:N:N3G:226830454)

            1cc: CLA-2 CO:R:C:V:DBI:MM:9/7/88