January 15, 2003
TARIFF NO.: 7113.19.5000
Mr. Stuart I. Rich Meister Seelig & Fein LLP 708 Third Avenue, 24th Floor New York, NY 10017
RE: The tariff classification and eligibility for duty-free treatment under the GSP of diamond rings from Thailand.
Dear Mr. Rich:
In your letter dated January 7, 2003, you requested a tariff classification and GSP eligibility ruling.
The product to be imported consists of diamond rings. "Rough" diamonds will be imported into Thailand from various countries, and then cut, faceted, and polished in Thailand to create a specialized patented finished diamond. The finished diamond will then be set into a ring. The finished diamond and the ring will be the finished product. We assume the rings will be made of 14 or 18 karat gold.
The applicable subheading for the diamond rings will be 7113.19.5000, Harmonized Tariff Schedule of the United States (HTS), which provides for "Articles of jewelry and parts thereof, of precious metal or of metal clad with precious metal: Of precious metal whether or not plated or clad with precious metal: Of other precious metal, whether or not plated or clad with precious metal: Other: Other." The rate of duty will be 5.3% ad valorem.
You have requested consideration of free duty under The Generalized System of Preferences (the "GSP") assuming that the direct cost of processing operations in Thailand is not less than 35% of the appraised value of each finished product at the time it enters into the United States.
The diamonds, which will be cut, faceted and polished in Thailand, undergo a substantial transformation. They are then considered a product of Thailand and can be included in the GSP calculation. Accordingly, if the direct cost of processing operations performed in Thailand equals or exceeds 35% of the appraised value of the merchandise at the time of entry into the U.S., the articles will qualify for duty-free treatment under the GSP.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Lawrence Mushinske at 646-733-3036.
Robert B. Swierupski Director, National Commodity Specialist Division