HQ 554980: Application for Further Review of Protest No. 1001-86-014513

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 554980
                          June 13, 1990

CLA-2 CO:R:C:V 554980 CW

CATEGORY:   CLASSIFICATION

TARIFF NO:  9802.00.80

Area Director of Customs
JFK Airport Area
Jamaica, New York 11430

RE:  Application for Further Review of Protest No. 1001-86-014513

     contesting denial of CBERA treatment for lingerie garments
     entered under item 807.00, TSUS

Dear Sir:

     The above-referenced protest, filed by counsel on behalf of
Inner Secrets, Inc., contests the denial by your office of duty-
free treatment under the Caribbean Basin Economic Recovery Act
(CBERA) for certain lingerie garments entered under item 807.00,
Tariff Schedules of the United States (TSUS) (now subheading
9802.00.80, Harmonized Tariff Schedule of the United States
(HTSUS)).

FACTS:

     The merchandise under consideration consists of ladies' and
girls' underwear and brassieres, in chief value of man-made
fibers, which were assembled in Saint Lucia (a CBERA beneficiary
country (BC)) in whole or in part of U.S. fabricated components.
Upon importation in 1986, the garments were entered under item
807.00, TSUS, and allowances in duty were granted for the cost or
value of the U.S. fabricated components incorporated therein.
There is no dispute regarding the applicability of item 807.00,
TSUS, to the garments in question.  The merchandise was
classified for duty-rate purposes in items 376 and 378, TSUS.

     Protestant maintains that the garments are entitled to duty-
free treatment under the CBERA in view of Presidential
Proclamation 5365 dated August 30, 1985 (50 Fed. Reg. 36220),
which lists item 807.00, TSUS, among the TSUS item numbers which
are eligible for CBERA treatment.  Your office determined that
the garments are ineligible for CBERA treatment based upon
section 2703(b)(1) of the CBERA (19 U.S.C. 2703(b)(1)), which
states that duty-free treatment under this special tariff
treatment program shall not apply to "textiles and apparel
articles which are subject to textile agreements."  See, also,
section 10.191(b)(2)(i), Customs Regulations (19 CFR
10.191(b)(2)(i)).



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ISSUE:

     Whether textile products subject to textile agreements are
eligible for CBERA treatment if entered under item 807.00, TSUS.

LAW AND ANALYSIS:

     Under the CBERA, eligible articles the growth, product or
manufacture of designated BC's may receive duty-free treatment if
such articles are imported directly from a BC, and if the sum of
1) the cost or value of the materials produced in a BC or BC's,
plus 2) the direct cost of processing operations performed in a
BC or BC's, is not less than 35% of the appraised value of the
article at the time it is entered into the U.S.  See 19 U.S.C.
2703(a), and section 10.195(a), Customs Regulations (19 CFR
10.195(a)).

     Articles are considered "eligible" if classified in a TSUS
provision for which a rate of duty appears in the "Special"
column followed by the symbol "E" or, with certain exceptions,
"E*".  See General Headnote 3(e)(vii)(B), TSUS.  Articles
provided for in a TSUS provision for which the symbol "E*"
appears in the "Special" column are eligible for CBERA treatment,
except for those articles specified in General Headnote
3(e)(vii)(D), TSUS, which include apparel articles "in chief
value of cotton, wool, man-made fibers, or blends thereof ...."
The articles under consideration here are classified for
duty-rate purposes in provisions (items 376 and 378, TSUS) for
which the symbol "E*" appears in the "Special" column.

     In a memorandum dated January 27, 1989 (HQ 554930), copy
enclosed, this office held that where an article is properly
classified in subheading 9802.00.80, HTSUS (which replaced item
807.00, TSUS), it is that provision, rather than the underlying
duty-rate tariff provision, which is controlling in determining
whether the article is eligible for one or more of the special
tariff treatment programs, such as the CBERA.  As counsel for the
protestant correctly points out, Presidential Proclamation 5365
dated August 30, 1985, listed item 807.00, TSUS, as one of the
TSUS provisions which is eligible for CBERA treatment.  However,
Presidential Proclamation 5646 dated May 4, 1987 (52 Fed. Reg.
16805), stated, in part, that:

     I have determined that the TSUS incorrectly indicates
     duty-free treatment for articles eligible for entry
     under certain items in schedule 8 of the TSUS [including
     item 807.00, TSUS] that are otherwise subject to duty
     under ... the Caribbean Basin Economic Recovery Act ....


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     Therefore, I am acting as indicated in Annex III to this
     Proclamation to delete the ... CBERA duty-free designations
     in the Rates of Duty Special column corresponding to these
     items.

Section B of Annex III to the Proclamation deleted the rate of
duty "Free" and the symbol "E" from the "Special" column opposite
item 807.00, TSUS, "[e]ffective with respect to articles entered,
or withdrawn from warehouse for consumption, on or after
September 1, 1985."

     Therefore, as the merchandise in this case was entered
(under item 807.00, TSUS) after September 1, 1985, it is
ineligible for duty-free treatment under the CBERA pursuant to
Presidential Proclamation 5646.

HOLDING:

     For the reasons set forth above, the textile products
subject to this protest are ineligible for duty-free treatment
under the CBERA.  Accordingly, the protest should be denied in
full.  A copy of this decision should accompany the Form 19,
Notice of Action, to be sent to the protestant.

                           Sincerely,




                           John Durant, Director
                           Commercial Rulings Division

Enclosure