United States v. Haggar Apparel Co., 526 U.S. 380 (1999)

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certiorari to the united states court of appeals for the federal circuit

No. 97-2044. Argued January 11, 1999—Decided April 21, 1999

Respondent sought a refund for customs duties imposed on garments it shipped to this country from an assembly plant it controlled in Mexico. If there were mere assembly in Mexico without other steps, the garments would have been eligible for a partial duty exemption under sub-heading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS), 19 U. S. C. 1202, which applies to articles assembled abroad and not otherwise improved except by an "operatio[n] incidental to the assembly process." Respondent, however, also sought to permapress the garments in order to maintain their creases and avoid wrinkles. To accomplish this, respondent baked the chemically pretreated garments at the Mexican plant. Claiming the baking was an added process in addition to assembly, the Customs Service denied a duty exemption under 19 CFR 10.16(c)(4), its regulation deeming all permapressing operations to be an additional step in manufacture, not part of or incidental to the assembly process. Respondent brought this suit in the Court of International Trade, which declined to treat the regulation as controlling and ruled in respondent's favor. The Court of Appeals for the Federal Circuit affirmed, declining to analyze the regulation under Chevron U. S. A. Inc. v. Natural Resources Defense Council, Inc., 467 U. S. 837.


1. The regulation in question is subject to Chevron analysis. Pp. 385-393.

(a) The statutes authorizing customs classification regulations are consistent with the usual rule that regulations of an administering agency warrant judicial deference; and nothing in the regulation in question persuades the Court that the agency intended the regulation to have some lesser force and effect. The statutory scheme does not support respondent's contention that the regulation is limited in application to customs officers themselves and is not intended to govern the adjudication of importers' refund suits in the Court of International Trade. The Customs Service (which is within the Treasury Department) is charged with fixing duties applicable to imported goods under regulations prescribed by the Secretary of the Treasury. See 19 U. S. C.

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