Newly Released CBP HQ Rulings for Sept. 10-20
The Customs Rulings Online Search System (CROSS) was updated between Sept. 10 and Sept. 20 with the following headquarters rulings (ruling revocations and modifications will be detailed elsewhere in a separate article as they are announced in the Customs Bulletin):
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H339758: Protein Bars; Valuation under 19 U.S.C. § 1401a; Computed Value
| Ruling: Based on the facts submitted, the subject protein bars should be appraised under computed value pursuant to 19 U.S.C. § 1401a(e), provided the importer is prepared to present CBP with documentation to support appraisement under this valuation method. |
| Issue: What is the proper method of appraisement for the subject protein bars? |
| Item: Vitaco Health (NZ) Limited produces high protein flavored bars marketed as sports nutrition foods. The importer will manufacture the protein bars in New Zealand and will ship them directly to the U.S. where the merchandise will stay in a third-party warehouse until a sale is made to end consumers via Amazon.com. The importer will retain ownership while the protein bars are in the warehouse after importation. The importer elects to use the computed value method over deductive value. |
| Reason: This is a prospective ruling, and Vitaco did not provide the documents substantiating the actual costs and the relevant profit concerning the protein bars. Thus, CBP cannot definitively rule that the goods should be appraised under computed value. Based upon the facts which the importer has provided to CBP, it is likely that appraisement under computed value is proper. The cost or value of the materials and the fabrication and other processing of any kind employed in the production of the imported merchandise will be determined on the basis of information supplied by, or on behalf of, the producer and will be based upon the commercial accounts of the producer, if such accounts are consistent with the generally accepted accounting principles applied in the country where the goods are produced. The “amount for profit and general expenses” will be determined on the basis of information supplied by, or on behalf of, the producer and will be based upon the commercial accounts of the producer, provided that such accounts are consistent with the generally accepted accounting principles applied in the country where the goods are produced and unless the figures provided are inconsistent with those usually reflected in sales, of merchandise of the same class or kind as the imported merchandise, that are made by producers in the country of exportation for export to the United States. |
| Ruling Date: Aug. 30, 2024 |
H337092: Applications for Further Review; Protests Nos. 3901-22-126592, 3901-22-126433 and 3901-22-126756; Transaction Value; Credit for Payments Already Made
| Ruling: The claimed price reductions may not be taken into account in determining the price actually paid or payable for the imported merchandise. These protests should be denied. |
| Issue: May the merchandise covered by the three Protests/AFRs be appraised under transaction value based on the reduced prices detailed in the September 18, 2020, e-mail, and executed by the $[x] credit note? |
| Item: Importer R.J. Reynolds Tobacco's Chinese-origin packaged power units for electronic vaporizing devices (PUKs). R.J. Reynolds Tobacco states that in early 2020, it initiated discussions with the Chinese manufacturer regarding packaging changes for the PUKs. According to an e-mail from the manufacturer to the protestant dated Sept. 18, 2020, product-specific price reductions were applied to purchase orders for the PUKs before Sept. 30, 2020, and after Oct. 1, 2020. |
| Reason: The Sept. 18, 2020 e-mail with the price reductions predates the first entry covered by the AFRs/protests submitted on Oct. 5, 2020. But apart from the Sept. 18, 2020 e-mail from the manufacturer listing the price reductions, the protestant has not submitted a written contract with the manufacturer for the sale of the imported merchandise explaining the types of price reductions and how and when the discounts will be applied. Furthermore, the Sept. 18, 2020 e-mail reveals that the discounts were conditional because they were linked to a minimum order quantity. Since the protestant has not demonstrated that the specified minimum order quantity was fulfilled at the time of entry, the conditional discount may not be used to determine transaction value. |
| Ruling Date: July 19, 2024 |
H311142: Application for Further Review of Protest No. 1503-20-100026; Tariff Classification of material constructed from ultra-high molecular weight polyethylene filaments; Valuation
| Ruling: By application of GRI 1, “HB25,” “HB26,” and “HB50” are classified in subheading 3921.90.15, which provides for “other plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Products with textile components in which man-made fibers predominate by weight over any other single textile fiber: Other.” |
| Issue: What is the proper tariff classification of the “HB25,” “HB26,” and “HB50” materials? |
| Item: Three styles of material referred to as “HB25,” “HB26,” and “HB50” (collectively “HB materials”). According to protestant DSM Dyneema, the HB materials are constructed from ultra-high molecular weight polyethylene filaments for low-weight hard armor applications. |
| Reason: The HB materials are entirely embedded with plastic that is visible to the naked eye. The resin material used to bind the layers is visible throughout the samples provided. Therefore, pursuant to Note 3(b) to Chapter 56, and the ENs to heading 56.03, the HB materials cannot be classified in heading 5603. As the HB materials are embedded with plastic, CBP is directed to classification in Chapter 39, which provides for “plastics and articles thereof.” Since the HB materials are plastics combined with textiles, they are classified in heading 3921, and specifically in subheading 3921.90.15, which provides for “[o]ther plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Products with textile components in which man-made fibers predominate by weight over any other single textile fiber: Other.” |
| Ruling Date: May 28, 2024 |