CLA-2 RR:TC:SM 559780 CW
David J. Evan, Esq.
Grunfeld, Deciderio, Lebowitz & Silverman LLP
245 Park Avenue
New York, New York 10167-0002
RE: Eligibility of a toddler's top assembled in Mexico for duty-free treatment under subheading
9802.00.90, HTSUS; findings and trimmings; embroidery
Dear Mr. Evan:
This is in response to your letter of April 8, 1996, on
behalf of Bentex Kiddie Corp. ("Bentex"), requesting a ruling
concerning the eligibility of a toddler's top and similar
garments assembled in Mexico for duty-free treatment under
subheading 9802.00.90, Harmonized Tariff Schedule of the United
States (HTSUS). A sample of the top has been submitted for our
review. We regret the delay in responding.
FACTS:
Your request relates to style no. 286106 which is described
as a toddler's top. The body of the garment is constructed of
60% cotton/40% polyester knit fabric and the sleeves and
shoulders are constructed of 50% cotton/50% polyester knit
thermal fabric. The garment features a partial frontal opening
with four button closures and side seam vents measuring
approximately one inch in length. The garment also features an
embroidered design (a smiling tiger tossing a ball) on the left
hand side of the front panel.
You state that the fabric components will be wholly formed
and cut in the U.S. and sent to Mexico for assembly. In Mexico,
the cut fabric components will be assembled by sewing, foreign-origin buttons and a care label will be sewn onto the garment,
and a logo design will be sewn onto the garment with foreign
thread. The garment will then be returned to the U.S. You
advise that the foreign-origin buttons, embroidery thread and
care label do not exceed 25% of the value of all components.
ISSUE:
Whether the toddler's top produced in the manner described
above is entitled to duty-free treatment under subheading
9802.00.90, HTSUS, when imported into the U.S. from Mexico.
LAW AND ANALYSIS:
Subheading 9802.00.90, HTSUS, provides for the duty-free
treatment of:
Textile and apparel goods, assembled in Mexico in which all
fabric components were wholly formed and cut in the United
States, provided that such fabric components, in whole or in
part (a) were exported in condition ready for assembly
without further fabrication, (b) have not lost their
physical identity in such articles by change in form, shape
or otherwise, and (c) have not been advanced in value or
improved in condition abroad except by being assembled and
except by operations incidental to the assembly process,
provided that goods classifiable in chapters 61, 62, or 63
may have been subject to bleaching, garment dyeing, stone-washing, acid-washing or perma-pressing after assembly as
provided for herein. [Emphasis added.]
In view of the fact that the enactment of subheading
9802.00.90, HTSUS, specifically was intended to extend duty-free
and quota-free status to all goods assembled in Mexico, which
previously were eligible for entry under the Special Regime
Program administered under subheading 9802.00.8010, HTSUS, it is
Customs view that all of the policy directives implementing this
program should be considered applicable in the administration of
subheading 9802.00.90, HTSUS. One such policy under the Special
Regime Program included the allowance of "findings, trimmings,
and certain elastic strips of foreign origin" to be incorporated
into the assembled good "provided they do not exceed 25 percent
of the cost of the components of the assembled product."
Examples of findings and trimmings are sewing thread, hooks and
eyes, snaps, buttons, "bow buds," lace trim, zippers, including
zipper tapes, and labels. See 53 FR 15726 (May 3, 1988).
You advise that the only foreign components which will be
used to make the toddler's top are buttons, embroidery thread and
a care label. These are considered "findings and trimmings" as
those terms are defined in the policy directives issued in
connection with the Special Regime Program.
With respect to the embroidery of the logo design on the
front panel of the garment, we need not determine whether this
operation constitutes an operation incidental to the assembly
process since subheading 9802.00.90, HTSUS, requires only that
the "fabric components, in whole or in part " (emphasis added)
satisfy the three conditions identified in this provision under
(a), (b), and (c). See Presidential Proclamation 6821 dated
September 13, 1995 (60 FR 47663). The toddler's top consists of
five fabric components, only one of which is subjected to the
embroidery process. Therefore, regardless of whether or not the
embroidery of the front panel of the top constitutes an operation
incidental to the foreign assembly process, this operation will
not preclude the garment from receiving the benefits of this
tariff provision.
HOLDING:
Based on the information submitted, the toddler's top
assembled in Mexico from fabric components wholly formed and cut
in the U.S. will qualify for duty-free treatment under subheading
9802.00.90, HTSUS, provided the foreign-origin buttons,
embroidery thread and care label do not exceed 25% of the cost of
the components of the garment.
A copy of this ruling letter should be attached to the entry
documents filed at the time the goods are entered. If the
documents have been filed without a copy, this ruling should be
brought to the attention of the Customs officer handling the
transaction.
Sincerely,
John Durant
Director, Tariff Classification
Appeals Division