Fancy Jewelry Company exported 100 identical 14 karat gold bracelets from the United States to Brazil. In Brazil, its subsidiary company polished the gold bracelets. Polishing jewelry is an acceptable alteration under subheading 9802.00.50, HTSUS. The subsidiary then exported 50 of the polished gold bracelets from Brazil back to the United States, along with 50 Chinese origin 14 karat gold bracelets in the exact same style that Fancy Jewelry Company had exported from the United States for polishing one month earlier. As Fancy Jewelry Company’s customs broker, would you be correct to advise entry under subheading 9802.00.50, HTSUS?
A. No, because subheading 9802.00.50, HTSUS, excludes commingled goods.
B. No, because subheading 9802.00.50, HTSUS, excludes goods which are advanced in value or improved in condition.
C. No, because subheading 9802.00.50, HTSUS, only applies to an importation of the exact same number of goods.
D. Yes, only if Fancy Jewelry Company utilizes a warranty management method.
E. Yes, only if Fancy Jewelry Company utilizes an inventory management method based on generally accepted accounting principles to account for the origin, value and classification of such articles. The same inventory management method must be used for all fungible articles.
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The Answer is: E
Citation: 9802.00.50, Subchapeter II Note3(f) to Chapter 98
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