CLA-2 CO:R:C:T 954631
Siegel, Mandell & Davidson, P.C.
One Astor Plaza
1515 Broadway
43rd Floor
New York, NY 10036
RE: Country of origin of denim jeans; Section 12.130, Customs
Regulations
Dear Sirs:
This is in response to your inquiry of July 16, 1993, on
behalf of your client, Lazeon Corporation - D/B/A Daily Jeans,
requesting a country of origin determination for women's denim
jeans. Samples were submitted for examination.
FACTS:
There are three styles of women's jeans at issue. Style A
is described as a traditional basic five pocket denim trouser
containing a fly front with zipper closure, a button closure at
the waistband, two rear patch pockets, two scoop front pockets, a
coin pocket within one front pocket, and single belt loops.
Style B is constructed essentially the same as Style A except for
the double belt loops crossed in the shape of an "X" in lieu of
the single belt loops and the addition of grommets into the front
of each pant leg. Style C contains the same basic construction
features of Style A with the exception of double belt loops
crossed in the shape of an "X" in lieu of single belt loops and
three 3-inch long vertical openings on the outer seam of each
pant leg with three nailhead studded denim strips.
The manufacturing steps for the subject merchandise are as
follows: The denim fabric will be woven in Hong Kong and any
denim components (zippers, buttons, rivets, nailhead studs,
grommets, and cording) will also be sourced in Hong Kong; the
denim fabric will be cut into garment pieces in Israel. The
assembly operation will be performed in the People's Republic of
China or an alternative country other than Hong Kong or Israel.
The aforementioned assembly operation involves sewing the cut
panels together by machine to produce the finished trousers. The
specific assembly steps are as follows: (1) feeding the back
yoke, back rise and waistband; (2) double needle stitching the
front, coin pocket, and back pocket; (3) over-locking the front
pocket; (4) attaching the belt loops; (5) stitching the side
seams; (6) hemming the legs; (7) and stitching the button holes.
Also for Style B, the holes will be punched and reinforced
patches will be sewn on, the grommets will be inserted, and the
nylon cord will be threaded through the grommet holes. In the
case of Style C, three vertical openings will be left in the
outer seam of each pant leg, and the narrow denim strips will be
adorned with nailhead studs and sewn across each opening.
ISSUE:
What is the country of origin for the merchandise in
question?
LAW AND ANALYSIS:
Country of origin determinations for textile products are
subject to Section 12.130, Customs Regulations (19 CFR 12.130).
Section 12.130 provides that a textile product that is processed
in more than one country or territory shall be a product of that
country or territory where it last underwent a substantial
transformation. A textile product will be considered to have
undergone a substantial transformation if it has been transformed
by means of substantial manufacturing or processing operations
into a new and different article of commerce.
Section 12.130(d), Customs Regulations, sets forth criteria
for determining whether a substantial transformation of a textile
product has taken place. This regulation states these criteria
are not exhaustive; one or any combination of criteria may be
determinative, and additional factors may be considered.
Section 12.130(d)(1), Customs Regulations, states that a new
and different article of commerce will usually result from a
manufacturing or processing operation if there is a change in:
(i) Commercial designation or identity, (ii) Fundamental
character or (iii) Commercial use.
Section 12.130(d)(2), Customs Regulations, states that for
determining whether merchandise has been subjected to substantial
manufacturing or processing operations, the following will be
considered:
(i) The physical change in the material or article
(ii) The time involved in the manufacturing or processing
(iii) The complexity of the manufacturing or processing
(iv) The level or degree of skill
(v) The value added to the article or material
Section 12.130(e)(1), Customs Regulations, describes
manufacturing or processing operations from which an article will
usually be considered a product of the country in which those
operations occurred. Section 12.130(e)(1)(v) provides the
following:
Substantial assembly by sewing and/or tailoring of all cut
pieces of apparel articles which have been cut from fabric
in another foreign territory or country, or insular
possession, into a completed garment (e.g. the complete
assembly and tailoring of all cut pieces of suit-type
jackets, suits and shirts).
According to T.D. 85-38, the final document rule
establishing 19 CFR 12.130:
The assembly of all the cut pieces of a garment usually is a
substantial manufacturing process that results in an article
with a different name, character, or use than the cut
pieces. It should be noted that not all assembly operations
of cut garment pieces will amount to a substantial
transformation of those pieces. Where either less than a
complete assembly of all the cut pieces of a garment is
performed in one country, or the assembly is a relatively
simple one, then Customs will rule on the particular factual
situation as they arise, utilizing the criteria in Section
12.130(d).
Customs has consistently determined that cutting fabric into
garment pieces constitutes a substantial transformation of the
fabric and the clothing pieces become products of the country
where the fabric is cut. (See e.g. Headquarters Ruling Letter
(HRL) 952531, dated November 25, 1992, HRL 089539, dated April
22, 1992).
Customs has also long held that the mere assembly of goods
entailing simple combining operations, trimming or joining
together by sewing is not enough to substantially transform the
components of an article into a new and different article of
commerce. (See e.g. HRL 082787, dated March 9, 1989; and HRL
082747, dated February 23, 1989).
In HRL 951169, dated April 1, 1992, Customs determined the
country of origin of denim jeans similar in construction to the
instant garments. The denim jeans therein were imported into
Singapore from Country X already cut into garment pieces. The
garment pieces were completely assembled and finished in
Singapore. Customs concluded that the garments underwent their
last substantial transformation in the country where they were
cut into garment pieces, Country X.
In this case, the sewing operation performed in Singapore
involves the simple assembly of various garment pieces. The
sewing does not involve the complex sewing operation required by
Section 12.130(e)(1)(v). The cutting process in Israel, however,
does amount to a substantial manufacturing operation. The
cutting operation materially changes the fabric into designated
garment pieces, which constitute new and different articles of
commerce. Therefore, in accordance with prior Customs rulings
and Section 12.130(e), the instant garments are subject to their
last substantial transformation in Israel, where they were cut
into garment pieces.
HOLDING:
The country of origin of Styles A,B, and C is the country
where they were cut into garment pieces, Israel.
The holding set forth above applies only to the specific
factual situation and merchandise identified in the ruling
request. This position is clearly set forth in section
177.9(b)(1), Customs Regulations (19 CFR 177.9(b)(1)). This
section states that a ruling letter is issued on the assumption
that all of the information furnished in connection with the
ruling request and incorporated in the ruling letter, either
directly, by reference, or by implication is accurate and
complete in every material respect. Should it subsequently be
determined that the information furnished is not complete and
does not comply with 19 CFR 177.9(b)(1), the ruling will be
subject to modification or revocation. In the event there is a
change in the facts previously furnished, this may affect the
determination of country of origin. Accordingly, it is
recommended that a new ruling request be submitted in accordance
with section 177.2, Customs Regulations (19 CFR 177.2).
Sincerely,
John Durant, Director
Commercial Rulings Division