HQ 555325: Applicability of partial duty exemption under HTSUS subhead- ing 9802.00.50 to freeze-dried cooked diced chicken from Canada

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 555325

                        September 6, 1989

CLA-2 CO:R:C:V 555325 GRV

CATEGORY:  CLASSIFICATION

TARIFF NO.:  9802.00.50

Mr. Alan Litwin
Assistant Manager
F.W. Meyers & Co., Inc.
69 Delaware Avenue
Buffalo, New York  14202

RE:  Applicability of partial duty exemption under HTSUS subhead-
     ing 9802.00.50 to freeze-dried cooked diced chicken from
     Canada

Dear Mr. Litwin:

     This is in response to your letter of February 8, 1989, to
the District Director of Customs, Buffalo, New York, requesting a
ruling on behalf of Cobi Foods, Inc., concerning the tariff
status of cooked diced U.S. chicken to be freeze-dried in Canada
and returned to the U.S.  Your letter, as well as correspondence
from your client, were forwarded to this office for the prepara-
tion of a response.  We are treating your letter as a prospec-
tive ruling request.

FACTS:

     Your client purchases cooked diced frozen chicken in the
U.S. and ships it to Canada for freeze-drying.  The freeze-dry-
ing operation merely removes the water from the chicken, and the
chicken is then returned to the U.S. for use in dried soups.

ISSUE:

     Whether freeze-drying constitutes an acceptable "altera-
tion," for purposes of subheading 9802.00.50, Harmonized Tariff
Schedule of the United States (HTSUS), thereby rendering the
returned chicken eligible for the partial duty exemption under
this tariff provision.

LAW & ANALYSIS:

     Articles returned to the U.S. after having been exported to
be advanced in value or improved in condition by repairs or
alterations may qualify for the partial duty exemption under
HTSUS subheading 9802.00.50, provided the foreign operation does
not destroy the identity of the exported articles or create new
or different articles.  Further, entitlement to this tariff
treatment 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 & Company, Inc., v. United States, 81 Cust.
Ct. 1, C.D. 4755, 455 F.Supp. 618 (1978), aff'd, 66 CCPA 77,
C.A.D. 1225, 599 F.2d 1015, 1019 (1979).  Articles entitled to
this partial duty exemption are dutiable only upon the cost or
value of the foreign repairs or alterations, provided the docu-
mentary requirements of section 10.8, Customs Regulations (19
CFR 10.8), are satisfied.

     Freeze-drying is a process whereby ice in frozen products is
transformed or sublimated into vapor without passing through the
liquid state.  Customs has stated that freeze-dried food items
retain their value and quality as food, and that their identity
as food is not lost or destroyed by the freeze-drying process.
See, Headquarters Ruling Letter 553936/814513 (December 18,
1985), holding that freeze-dried sliced frozen mushrooms and
diced chicken meat were eligible for treatment under item 806.20,
Tariff Schedules of the United States (TSUS) (the precursor
provision to HTSUS subheading 9802.00.50); Headquarters Ruling
Letter 071187 (March 1, 1983), holding the same for shelled peas;
and Headquarters Ruling Letter 067964 (September 21, 1982),
holding the same for cut chives.

     In the instant case, the description of diced chicken meat
as cooked shows that the food product is a finished product when
exported.  This condition of the product, coupled with our prior
determinations on the freeze-drying process, renders the freeze-
dried diced cooked chicken to be returned eligible for the par-
tial duty exemption under HTSUS subheading 9802.00.50.

     The freeze-dried chicken meat will be classified under HTSUS
subheading 0210.90.20, dutiable at 4.5% ad valorem, pursuant to
the United States-Canada Free-Trade Agreement.

     You mentioned in your letter that HTSUS subheading
9813.00.05 could be applicable to the articles in question.  Be
advised that that tariff provision applies to articles imported
into the U.S. for repairs, alterations or processing; not to
articles exported for repairs or alterations.
CONCLUSION:

     On the basis of the described foreign operation, the freeze-
dried cooked diced chicken will be eligible for the partial duty
exemption under HTSUS subheading 9802.00.50 when returned to the
U.S., upon compliance with the documentary requirements of 19 CFR
10.24.

                         Sincerely,




                         John Durant, Director
                         Commercial Rulings Division