HQ 224789: Zone to Zone transfers; transfer of foreign status merchandise; 19 CFR 146.41(a)

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.

                        September 27, 1993

                            HQ 224789

FOR-2-03-CO:C:E: 224789 CB

CATEGORY:  Entry

Mr. Thomas S. Moore
Port of Corpus Christi Authority
222 Power Street
P. O. Box 1541
Corpus Christi, TX 78403

RE:  Zone to Zone transfers; transfer of foreign status
     merchandise; 19 CFR 146.41(a)

Dear Mr. Moore:

     This is in response to your letter of June 14, 1993, wherein
you requested a binding ruling, on behalf of several oil refinery
subzones, regarding the ability to transfer foreign status
merchandise from one subzone to another.

FACTS:

     According to your letter, subzones 122A, B, and C may
manufacture products utilizing non-privileged foreign status
merchandise.  The products refined at these subzones are then
either exported from the United States, entered into the customs
territory of the United States, or transferred to another subzone. 

     Subzones 122I, J, and L have restrictions in their Grants of
Authority which require that the subzone "elect privileged foreign
status on foreign crude oil and other foreign merchandise admitted
to the subzone."  Therefore, when the non-privileged foreign status
merchandise is transferred from subzones 122A, B, or C to subzones
122I, J, and L, the receiving subzone must, according to its grant,
admit said foreign status merchandise into its subzone in
privileged foreign status designation.

     You have requested a "ruling to the effect that 'non-
privileged foreign status' merchandise may be transferred from a
subzone in which it has been manipulated or manufactured so as to
effect a change in its tariff classification to a second subzone
and be admitted therein in 'privileged foreign status.'"

ISSUE:

     Whether non-privileged foreign merchandise, which has been
manipulated or manufactured in a foreign trade zone, may be
transferred to a second zone and admitted in privileged foreign
status?

LAW AND ANALYSIS:

     In your letter you note that the applicable regulation, 19 CFR
146.41(a), provides that only "foreign merchandise which has not
been manipulated or manufactured so as to effect a change in tariff
classification will be given status as privileged foreign status
merchandise...."  Therefore, since the non-privileged foreign
status merchandise has been manipulated or manufactured at subzones
122A, B or C so as to effect a change in its tariff classification,
the District Director does not have any regulatory authority to
approve the admission of the foreign status merchandise in
privileged foreign status in a subsequent subzones 122I, J, and L. 
The fact that, as you stated, there are "two separate manufacturing
operations involved" does not make a difference.  The language of
the regulation is very clear.

     The Foreign Trade Zones Board is charged with the primary
responsibility of administering the Foreign Trade Zones Act, as
amended, 19 U.S.C. 81c.  Therefore, we suggest that you bring the
issue of the limiting language contained in the Grants of Authority
issued to Subzones 122I, J, and L with the Board.

HOLDING:

     Non-privileged foreign merchandise which has been admitted
into one foreign trade zone, and therein manipulated or
manufactured, may not be transferred to a subsequent foreign trade
zone and admitted in privileged foreign status.

                                   Sincerely,




                                   John Durant, Director
                                   Commercial Rulings Division