HQ 555869: Eligibility of U.S.-origin connectors for a duty allowance when attached to Japanese wire and incorporated in an electrical harness. Timex

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 555869

                          April 2, 1991

CLA-2 CO:R:C:S  555869 KCC

CATEGORY:  Classification

TARIFF NO.:  9802.00.80

Mrs. Orquidea Catalanotto
Sumitrans Corporation
1981 Marcus Avenue
Suite E-102
Lake Success, New York  11042

RE:  Eligibility of U.S.-origin connectors for a duty allowance
     when attached to Japanese wire and incorporated in an
     electrical harness. Timex

Dear Mrs. Catalanotto:

     This is in response to your letter dated January 30, 1991,
requesting a ruling concerning the applicability of subheading
9802.00.80, Harmonized Tariff Schedule of the United States
(HTSUS), to electrical harnesses from Mexico containing U.S.-
origin connectors.  Samples of the connectors and electrical
harness were previously submitted for examination.

FACTS:

     Sumitrans manufactures wire for electrical harnesses used in
automobiles and motorcycles.  Sumitrans intends to import
Japanese origin wire into the U.S.  In the U.S., the wire will
be cut to varying lengths and U.S.-origin electrical connectors
will be crimped onto the ends of the wire.  The wire and
connectors, now called "wire for an unassembled harness", will be
shipped to Mexico and attached to additional components to form
an electrical harness.  Upon completion of the foreign
operations, the electrical harness will be returned to the U.S.

     Sumitrans previously received Headquarters Ruling Letter
(HRL) 555774 dated December 10, 1990, which held that cutting
Japanese origin wire to length and crimping U.S.-origin
connectors onto the wire ends does not result in a substantial
transformation of the Japanese origin wire into a product of the
U.S.  You now inquire whether the cost or value of the U.S.-
origin connectors will be eligible for the partial duty exemption
available under subheading 9802.00.80, HTSUS, when returned to
the U.S. incorporated in the electrical harness.




ISSUE:

     Whether the U.S.-origin connectors will be eligible for a
duty allowance under subheading 9802.00.80, HTSUS, when returned
to the U.S. as part of electrical harnesses.

LAW AND ANALYSIS:

     Subheading 9802.00.80, HTSUS, provides a partial duty
exemption for:

     [a]rticles assembled abroad in whole or in part of
     fabricated components, the product of the United States,
     which (a) were exported in condition ready for assembly
     without further fabrication, (b) have not lost their
     physical identity in such articles by change in form, shape,
     or otherwise, and (c) have not been advanced in value or
     improved in condition abroad except by being assembled and
     except by operations incidental to the assembly process,
     such as cleaning, lubricating, and painting.

All three requirements of subheading 9802.00.80, HTSUS, must be
satisfied before a component may receive a duty allowance.  An
article entered under this tariff provision is subject to duty
upon the full cost or value of the imported assembled article,
less the cost or value of the U.S. components assembled therein,
upon compliance with the documentary requirements of section
10.24, Customs Regulations (19 CFR 10.24).

     U.S. components are entitled to the duty exemption available
under subheading 9802.00.80, HTSUS, even though they had been
originally combined with foreign components in the U.S. and then
exported for foreign assembly operations.  Timex Corporation v.
United States, 12 CIT    , 691 F. Supp. 1445 (CIT 1988).  In
Timex, watch bezels of U.S.-origin were combined with foreign
crystals in the U.S. to create bezel crystal assemblies.  The
bezel crystal assemblies were exported to Mexico for assembly
into watches and then returned to the U.S.  The court held that
as the bezels were of U.S.-origin and did not occasion a
drawback, they were entitled to the duty exemption available
under item 807.00, Tariff Schedules of the United States (HTSUS)
(the precursor provision to subheading 9802.00.80, HTSUS).

     Assuming that the foreign assembly operations satisfy all
the requirements of subheading 9802.00.80, HTSUS, it is our
opinion that the U.S. connectors will be entitled to a duty
allowance under this tariff provision.  Like the bezels in Timex,
the U.S. connectors are subjected to similar domestic and foreign



operations.  First, the U.S. connectors are combined with
Japanese wire in the U.S. to form "wire for the unassembled
harness."  The "wire for the unassembled harness" is then
shipped to Mexico for assembly with other components to create
an electrical harness, which is thereafter returned to the U.S.

HOLDING:

     If all the requirements of subheading 9802.00.80, HTSUS, are
met during the assembly of the electrical harness in Mexico, an
allowance in duty may be made for the cost or value of the U.S.
connectors incorporated therein.

                              Sincerely,



                              John Durant, Director
                              Commercial Rulings Division