May 22, 2009 CBP Bulletin Notice on Classification of Tumbled Semi-Precious Gemstones

Proposed revocation of ruling; proposed revocation of treatment. CBP is proposing to revoke one ruling on the classification of tumbled semi-precious gemstones. Additionally, CBP proposes that this notice covers any rulings on this merchandise that may exist but have not been specifically identified. CBP is also proposing to revoke any treatment it has previously accorded to substantially identical transactions.

CBP states that any party who has received a contrary written ruling or decision on the merchandise that is subject to the proposed revocations, or any party involved with a substantially identical transaction, should advise CBP by June 21, 2009, the date that written comments on the proposed ruling are due. Furthermore, CBP states that an importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agent for importations subsequent to the effective date of the final decision in this notice.

Tumbled semi-precious gemstones. The articles at issue are the following semi-precious gemstones: banded amethyst rose quartz, leopard skin, jasper and rock crystal B. The rough gemstones are shoveled into 2 1/5 ton tumblers with abrasives and water. The tumblers are turned over and over and the stones slide and rub against each other for many weeks until they are perfectly smooth. Tumbling gives the stones a slick and shiny surface. Upon importation, the gemstones are not set. Once imported, the stones will be used to manufacture various articles of jewelry such as, bracelets, necklaces and earrings.

CBP is proposing to issue HQ H023364 in order to revoke HQ 951866 and reclassify the tumbled semi-precious gemstones under HTS 7103.99.50 as "semi-precious stones whether or not worked or graded but not strung, mounted or set . . . : Otherwise worked: Other: Other," rather than under HTS 7103.99.10 as "semi-precious stones whether or not worked or graded but not strung, mounted or set . . . : Otherwise worked: Other: Cut but not set."

CBP proposes this change as a correction based on the General Rules of Interpretation (GRIs) and technical definitions from the Dictionary of Gems and Gemology. 2nd ed. Germany: Springer, 2005. ISBN: 3-540-23970-7. CBP now proposes that their determination in ruling HQ 951866 is incorrect because they erroneously used the term "tumbled" interchangeably with the term "cut." In fact, the subject stones were tumbled, but not cut. After consulting technical sources, CBP has found that the terms "cutting" and "polishing" describe two different processes in gem manufacturing and are not interchangeable.

It is undisputed in this case that the merchandise consists of "semiprecious stones" according to the terms of heading 7103, and that they are "otherwise worked," i.e., worked in a manner other than "simply sawn or roughly shaped," as required by the terms of subheading 7103.99. At issue is the classification of the stones at the 8-digit level, specifically, whether the stones are "cut but not set." The stones at issue were "tumbled," which is one of two different methods of polishing gems (abrasive polishing is the other). However, they were not "cut." As such, they are precluded from classification in HTS 7103.99.10.

CBP now proposes that by application of GRI 1, the tumbled semi-precious gemstones should be classified in subheading 7103.99.50, which provides for: "semi-precious stones whether or not worked or graded but not strung, mounted or set . . . : Otherwise worked: Other: Other."

Proposed: 7103.99.50, 10.5%; current: 7103.99.10, duty-free

May 22, 2009 CBP Bulletin (Vol. 43, No. 21) available athttp://www.cbp.gov/xp/cgov/trade/legal/bulletins_decisions/bulletins_2009/