CLA-2 CO:R:C:V 554929 DBI
Edwin C. Bullock, Esq.
Kuhn and Miller
1412 Broadway
New York, New York 10018
RE: Applicability of partial duty exemption of item 807.00,
TSUS, to children's headwear
Dear Mr. Bullock:
This is in response to your letter dated February 17, 1988,
in which you request a ruling concerning the applicability of
item 807.00, Tariff Schedules of the United States (TSUS), to
children's headwear that will be imported by your client from the
Dominican Republic.
FACTS:
You advise that component parts of children's headwear will
be produced in the U.S. out of textile material imported from the
Far East. In its imported condition the textiles will be in the
form of greige goods. After importation, the greige goods will
be subjected to the following six processes:
1. Singeing - running them over an open flame at high
speed and then directly into water to remove surface hair,
which prevents pilling.
2. Desizing - soaking them in an enzyme bath, which eats
away the sizing materials which were used in the weaving
process.
3. Scouring - cleaning them in a mixture of hot water and
caustic agents.
4. Bleaching - bleaching them with a peroxide bleach to
remove motes and achieve whiteness.
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5. Finishing - stabilizing them with a crease resistant
finish which decreases susceptibility to wrinkling and also
provides shrinkage control.
6. Cutting - cutting them into the size and shape of
headwear parts.
After these operations are completed, the cut pieces will be
shipped to the Dominican Republic to be assembled.
You have noted that this request concerns the qualification
of the cut pieces as products of the U.S. prior to exportation to
the Dominican Republic, and does not concern whether the
operations performed abroad constitute acceptable assembly
operations under item 807.00, TSUS.
ISSUE:
Whether the described headwear components exported to the
Dominican Republic for assembly into children's headwear qualify
as products of the U.S. for purposes of item 807.00, TSUS
(9802.00.80, Harmonized Tariff Schedule of the United States
(HTSUS)).
LAW AND ANALYSIS:
Item 807.00, TSUS, applies to articles assembled abroad in
whole or in part of fabricated components, the products of the
U.S., with no operations performed thereon except the attachment
of the components to form the imported merchandise and operations
incidental thereto. An article classified under item 807.00,
TSUS, is subject to duty upon the full appraised value of the
imported article, less the cost or value of such products of the
U.S.
Section 10.14(b) of the Customs Regulations (19 CFR
10.14(b)), provides that foreign-made articles or materials may
become products of the U.S. for purposes of item 807.00, TSUS, if
they undergo a process of manufacture in the U.S. which results
in their substantial transformation. According to this
provision, a substantial transformation occurs when, as a result
of manufacturing processes, a new and different article emerges,
having a distinctive name, character, or use which is different
from that originally possessed by the article or material.
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We have previously held that the cutting of garment parts
from fabric will result in a substantial transformation of the
fabric. T.D. 85-38, 19 Cust. Bull. 58 (1985).
In the present case, it is our opinion that the cutting to
size and shape alone is sufficient to result in a substantial
transformation of the imported fabric into a U.S. product. The
greige goods have been transformed into goods that have a
specific pattern and, therefore, are only suitable to be used in
the assembly of children's headwear. Clearly this is a different
article having a distinctive use which is different from that
originally possessed by the material.
HOLDING:
On the basis of the information submitted, it is our
opinion that the described processing of the imported foreign-
made fabric in the U.S. substantially transforms the fabric into
fabricated components, the product of the U.S., within the
meaning of item 807.00, TSUS.
Sincerely,
John Durant
Director, Commercial
Rulings Division