Apollo Overseas International, Inc. - Page 6

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          the shipment was by sea, the shipper would send the shipping                
          documents to petitioner, and petitioner would provide these                 
          documents to Alexander Air.  Alexander Air then determined the              
          applicable U.S. customs duty rate for each item listed on each of           
          the shipping documents based on the rates shown in the Harmonized           
          Tariff Schedule of the United States, promulgated by the U.S.               
          International Trade Commission (the Harmonized Tariff Schedule).            
          Mr. Lee determined the amount of customs duty by applying the               
          rate specified in the Harmonized Tariff Schedule for a specific             
          classification of product to the various items listed on                    
          petitioner's purchase invoices for the years at issue.                      
               The U.S. Customs Service (the Customs Service) inspected               
          petitioner's documents and shipments infrequently during the                
          years at issue.  None of the few Customs Service inspections made           
          of petitioner's goods and documents during the years here in                
          issue resulted in changes in the amounts computed by Mr. Lee.               
               Customs duty rates applicable to imported items depend on              
          such variables as the type of fabric (e.g., knit versus woven),             
          the use of the garment (e.g., undergarment versus outergarment),            
          the country of origin, and the fabric composition (e.g., manmade            
          fiber versus all cotton versus cotton-polyester blend).                     
               The freight charge made by Alexander Air for shipment of               
          goods to petitioner was based on volume, expressed in cubic                 

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Last modified: May 25, 2011