CLA-2 CO:R:C:T 955781 CAB
Ms. Mary Jo Muoio
Wolf D. Barth Co. Inc.
90 West Street
New York, NY 10006
RE: Country of origin of a fitted sheet, flat sheet, and
pillowcase; Section 12.130, Customs Regulations
Dear Ms. Muoio:
This is in response to your inquiry of January 19, 1994,
requesting a country of origin determination for bed linen. This
request is on behalf of your client, Ascot & Company. A sample set
comprised of a fitted sheet, flat sheet, and pillowcase was
submitted for examination.
FACTS:
The articles in question are constructed of a woven blend of
70 percent cotton and 30 percent polyester fabric. You also state
that future imported merchandise may be constructed of 55 percent
polyester and 45 percent cotton fabric. The manufacturing process
includes the following: The material is woven, printed or dyed in
Pakistan. The fabric is then shipped to Thailand where the fabric
is cut and sewn into the finished product. The flat sheet is cut
to length and width (four sides), and hemmed. A piece of fabric
1/4 inch in width is folded, sewn onto the top edge of the flat
sheet, and is then joined to another section of fabric four inches
wide. The fitted sheet is cut to length and width (four sides)
elastic is then attached to two sides, while the other two sides
are hemmed. The pillowcase is cut on all four sides, hemmed,
folded, and a four inch piece of fabric is inserted along the
folded top edge. The above descriptions are based on the
representative samples submitted by you for examination.
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
operation;
(iii) The complexity of the manufacturing or
processing operation;
(iv) The level or degree of skill and/or technology
required; and,
(v) The value added to the article or material.
Section 12.130(e)(1)(iv), Customs Regulations, states that a
textile article will usually be a product of a particular country
if the cutting of the fabric into parts and the assembly of those
parts into the completed article has occurred in that country.
However, 12.130(e)(2)(ii), Customs Regulations, states that a
material will usually not be considered to be a product of a
particular foreign country by virtue of merely having undergone
cutting to length or width and hemming or overlocking fabrics which
are readily identifiable as being intended for a particular
commercial use.
When making a determination as to whether fabric used to make
sheets has been substantially transformed, the minimum processing
required is cutting the fabric to length and width (four sides).
After the fabric has been cut on four sides, Customs assesses the
additional processing and makes a determination as to whether the
additional processing coupled with cutting, amounts to a
substantial manufacturing operation.
In prior cases, Customs has evaluated the degree of skill,
value, and amount of time expended to manufacture sheets and made
substantial transformation determinations accordingly. In
Headquarters Ruling Letter (HRL) 952909, dated April 12, 1993,
Customs determined that fabric that had been cut to length and
width, coupled with the additional processing required to attach
piping to flat sheets, amounted to a substantial manufacturing
operation. In HRL 952225, dated December 8, 1992, Customs
determined that the flat sheet processing operation in Thailand
which included cutting fabric to length and width, hemming, and
adorning with either piping or ruffles was sufficiently complex so
as to amount to a substantial transformation in Thailand.
In your submission, you state that fabric is manufactured in
Pakistan, cut to length and width in Thailand, and a four inch top
edge will also be attached to the flat sheet in Thailand. The
issue is whether the processing in Thailand will be substantially
complex so as to constitute a substantial manufacturing operation
within the purview of Section 12.130(d). See HRL 953378, dated
February 19, 1993, where Customs examined the manufacturing process
involved in adding capping and piping to a flat sheet. Customs
explained that the processing required to add capping and piping
to a flat sheet involves sewing a band of fabric to finish the
sheet's top edge, forming a seam. The side edges of the band are
sewn to the sheet's edges. Finally, capping or piping is sewn
along the top edge of the seam. The four inch top edge inserted
into the seam of the subject flat sheet appears to be a form of
capping or piping. This additional processing done to the subject
flat sheet is more complex and time-consuming than merely cutting
flat sheets on four sides and hemming them. In light of the prior
cited Customs rulings, it appears that the processing involved in
constructing the flat sheet amounts to a substantial manufacturing
operation within the purview of Section 12.130. Therefore, in
accordance with prior Customs rulings, the country of origin of the
flat sheet is the country where the last substantial manufacturing
operation occurred, Thailand.
The processing necessary to convert fabric manufactured in
Pakistan into a finished fitted sheet in Thailand includes, cutting
on all four sides, hemming, and sewing elastic to two of the
sheet's sides, while hemming the other two sides. The degree of
difficulty and skill involved in the processing required to
transform the material at issue into a fitted sheet will be enough
to result in a new and different article of commerce. Therefore,
the country of origin of the fitted sheet is Thailand.
In determining the country of origin for pillowcases, Customs
refers to Belcrest Linens v. United States, 741 F.2d 1368, (Fed.
Cir. 1984). The court held that a bolt of woven fabric that was
manufactured, stenciled with embroidery, and imprinted with lines
of demarcation in China prior to being sent to Hong Kong where the
fabric was cut, sewn into pillowcases, and packaged was subject to
its last substantial transformation in Hong Kong. Thus, when
applying the court's rationale to the instant scenario, it appears
that the fabric which will be cut and sewn into pillowcases in
Thailand will undergo its last substantial transformation in that
country.
HOLDING:
The country of origin of the flat sheet, fitted sheet, and
pillowcase is Thailand.
This ruling is issued pursuant to the provisions of Part 177
Customs Regulations (19 CFR Part 177). The holding in this ruling
only applies to the specific factual situation presented and the
merchandise identified in the ruling request. If the information
furnished is not accurate or complete, or there is a change in the
factual situation, this ruling will no longer be valid. In such
an event, a new ruling request should be submitted.
Your attention is directed to the Notice of Proposed Rule
Making which the Customs Service published in the Federal Register
on Monday, January 3, 1994 (59 FR 141). That notice proposed
objective rules for determining the country of origin of goods
imported into the United States. Although, the notice stated that
the proposed rules were intended to codify our present origin
rules, there are a few areas where the proposed rules are not
consistent with Customs present position. The transaction
described in this ruling is one of those instances. Accordingly,
you should be aware that if the proposed rules are adopted as
published, this ruling will no longer be valid and a different
result may apply.
Sincerely,
John Durant, Director
Commercial
Rulings Division