OT:RR:CTF:FTM H304571 TJS
Jennifer R. Diaz, Esq.
Diaz Trade Law
12700 Biscayne Boulevard, Suite 301
North Miami, FL 33181
RE: Modification of NY N303580; Country of Origin of Stuffed Mattress Covers
Dear Ms. Diaz,
This is to inform you that U.S. Customs and Border Protection (“CBP”) has reconsidered New York Ruling Letter (“NY”) N303580, issued to you on April 10, 2019, regarding the classification, marking, and the eligibility for preferential tariff treatment under the Dominican Republic-Central America-United States Free Trade Agreement (“DR-CAFTA”) of certain stuffed mattress covers. In NY N303580, CBP classified certain stuffed mattress covers in subheading 9404.90.9522, Harmonized Tariff Schedule of the United States Annotated (“HTSUSA”). CBP also determined the country of origin to be El Salvador and that the subject merchandise was eligible for DR-CAFTA preferential tariff treatment. We have reviewed NY N303580 and determined that it is partially incorrect with respect to the country of origin marking analysis and determination. For the reasons set forth below, we hereby modify NY N303580.
In your initial request for a binding ruling, you requested that certain information be kept confidential pursuant to 19 C.F.R. § 177.2(b)(7). With respect to this request, we only discuss information referenced in NY N303580.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. §1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057), a notice of the proposed action was published in the Customs Bulletin, Volume 53, No. 39, on October 30, 2019. One comment, which will be addressed below, was received in response to this notice.
FACTS:
The subject merchandise consists of five styles of stuffed mattress covers, identified as S-10”, S-12”, S-14”, T-10”, and T-12”. These zippered mattress covers, imported by Dolven Enterprises, consist of different fabric components made of man-made, nonwoven and knit fabrics. The covers are used to encase and protect mattresses of various sizes. You indicate that the subject merchandise is meant to provide an additional layer of cushioned surface for slumbering.
In your ruling request, you presented various scenarios where the fabric components are manufactured in the United States, China, and Mexico. The scenarios are outlined as follows:
S-10” and 12”
Stuffed Fabric/Top and Border Knit/Cover are formed in the United States.
Bottom Fabric is formed in the United States.
S-14”
Stuffed Fabric/Top Knit/Cover is formed in the United States.
Border Fabric is formed in China.
Bottom Fabric is formed in the United States.
T-10” and 12”
Stuffed Fabric/Top Knit/Cover are formed in Mexico or China.
Border Fabric is formed in China.
Bottom Fabric is formed in China.
Additionally, the zippers for each style will be manufactured in China or El Salvador. In each circumstance above, the cutting, sewing, and assembly operations will be performed in El Salvador along with folding, packaging, boxing, marking, and loading into a container for export.
NY N303580 classified the subject mattress covers under subheading 9404.90.9522, HTSUSA, and determined the country of origin of the subject mattress covers to be El Salvador. In making the country of origin determination, CBP applied 19 C.F.R. § 102.21(c)(4), which confers country of origin based on where the most important assembly or manufacturing process occurs. In NY N303580, CBP considered the cutting, sewing, and assembly of the fabric panels and zippers as the most important assembly or manufacturing processes. As such, the country of origin was El Salvador, where these operations occurred.
ISSUE:
What is the country of origin for marking purposes of stuffed mattress covers?
LAW AND ANALYSIS:
Section 334 of the Uruguay Round Agreements Act, codified at 19 U.S.C. § 3592, provides rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. 19 C.F.R. § 102.21 implements section 334, and 19 C.F.R. § 102.0 refers to 19 C.F.R. § 102.21 for determining the country of origin of textile and apparel products. Pursuant to 19 C.F.R. § 102.21(c), the country of origin of a textile or apparel product will be determined by sequential application of the general rules set forth in paragraphs (c)(1) through (5).
Section 102.21(c)(1) provides that “the country of origin of a textile or apparel product is the single country, territory, or insular possession in which the good was wholly obtained or produced.” As the subject mattress covers are not wholly obtained or produced in a single country, territory, or insular possession, paragraph (c)(1) is inapplicable.
Paragraph (c)(2) provides, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) of this section, the country of origin of the good is the single country, territory, or insular possession in which each of the foreign materials incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement, specified for the good in paragraph (e) of this section:”
The applicable subheading for the subject mattress covers is 9404.90.9522, HTSUSA, which provides for “Mattress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with springs or stuffed or internally fitted with any material or of cellular rubber or plastics, whether or not covered: Other: Other: Other: Other: With outer shell of man-made fibers.” Section 102.21(e)(1) in pertinent part provides, “The following rules will apply for purposes of determining the country of origin of a textile or apparel product under paragraph (c)(2) of this section”:
HTSUS Tariff shift and/or other requirements
9404.90 Except for goods of subheading 9404.90 provided for in paragraph (e)(2) of this section, the country of origin of a good classifiable under subheading 9404.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.
Subheading 9404.90.95, HTSUS, is included in the paragraph (e)(2) exception to the above tariff shift rule. 19 CFR § 102.21(e)(2)(i) states, “The country of origin of the good is the country, territory, or insular possession in which the fabric comprising the good was both dyed and printed when accompanied by two or more of the following finishing operations: bleaching, shrinking, fulling, napping, decating, permanent stiffening, weighting, permanent embossing, or moireing.” Paragraph (e)(2)(i) only applies when the fabric comprising the good is both dyed and printed. You indicate that the fabric comprising the mattress covers is not printed, and therefore, paragraph (e)(2)(i) is inapplicable.
Paragraph (e)(2)(ii) provides, “If the country of origin cannot be determined under paragraph (e)(2)(i) of this section, [. . .] the country of origin is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.” As the fabric comprising the S-10” and S-12” mattress covers are manufactured in the United States, the country of origin for those styles is the United States. Since the S-14” mattress covers are comprised of fabric components manufactured in two different countries, the United States and China, paragraph (e)(2)(ii) is inapplicable. The fabric components comprising the T-10” and T-12” mattress covers are manufactured either entirely in China, or in both China and Mexico. Where the fabric comprising styles T-10” and T-12” are manufactured in China, the country of origin is China. Where the fabric components are manufactured in China and Mexico, paragraph (e)(2)(ii) is inapplicable. To determine the country of origin for these certain T-10” and T-12” mattress covers, along with style S-14”, we continue applying the general rules set forth by 19 C.F.R. § 102.21(c).
Paragraph (c)(3) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) or (2) of this section”:
If the good was knit to shape, the country of origin of the good is the single country, territory, or insular possession in which the good was knit; or
Except for goods of heading 5609, 5807, 5811, 6213, 6214, 6301 through 6306, and 6308, and subheadings 6209.20.5040, 6307.10, 6307.90, and 9404.90, if the good was not knit to shape and the good was wholly assembled in a single country, territory, or insular possession, the country of origin of the good is the country, territory, or insular possession in which the good was wholly assembled.
As the subject merchandise is not knit to shape and subheading 9404.90 is excepted from provision (ii), Section 102.21(c)(3) is inapplicable.
Paragraph (c)(4) provides, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2) or (3) of this section, the country of origin of the good is the single country, territory, or insular possession in which the most important assembly or manufacturing process occurred.” NY N303580 considered the most important assembly or manufacturing process of the subject mattress covers to be the cutting, sewing, and assembly of the fabric panels and zippers. However, the most important manufacturing process occurs at the time of the fabric making. See NY N304732 (July 11, 2019); NY N112937 (July 15, 2010); NY H85550 (Sept. 4, 2001); and Headquarters Ruling Letter (“HQ”) 959256 (June 20, 1996). Since the fabric for the mattress covers is formed in multiple countries, and no one fabric is more important than the other, the country of origin cannot be readily determined based on the fabric making process. As such, paragraph (c)(4) is inapplicable.
Paragraph (c)(5) provides, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2), (3) or (4) of this section, the country of origin of the good is the last country, territory or insular possession in which an important assembly or manufacturing process occurred.” Accordingly, for certain T-10” and T-12” styles, as well as style S-14”, country of origin is conferred by the last country in which an important assembly or manufacturing process occurred. Here, the last country in which as important assembly process occurred is El Salvador where the fabric comprising the mattress covers is cut and sewn, and ultimately assembled into the final product.
One comment was received in response to the proposed ruling. The commenter agreed with CBP’s country of origin determination with respect to the S-14” mattress covers and T-10” and T-12” covers of which the component fabrics are manufactured in China and Mexico. The commenter questioned the country of origin determination for the S-10”, S-12”, and T-10” and T-12” mattress covers of which all the component fabric is manufactured in China. The commenter’s argument is essentially one of statutory interpretation. The commenter urges CBP to apply a broad interpretation of the statutory rules of origin, claiming that when the Uruguay Round Agreements Act (19 U.S.C. § 3592) was enacted in 1994, it did not account for advanced manufacturing technology used in modern textile operations because manual labor was heavily relied upon at the time. The commenter asserts that the drafters intended for country of origin to be the country where “complex substantial work” occurs and not mere machinery work. Accordingly, the commenter claims that 19 C.F.R. § 102.21(e)(2)(ii) is inapplicable because the language is “not in line with current manufacturing processes,” including those used to form the fabric comprising the subject mattress covers.
We find no evidence to support the notion that fabric-making processes under Section 334 of the Uruguay Round Agreements Act (19 U.S.C. § 3592) and 19 C.F.R. § 102.21 exclude machinery work. In this case, it is not necessary to consider the drafters’ intent in enacting the rules of origin because the language of the regulations is clear. According to 19 C.F.R. § 102.21(b)(2), “a fabric-making process is any manufacturing operation that begins with polymers, fibers, filaments (including strips), yarns, twine, cordage, rope, or fabric strips and results in a textile fabric.” (emphasis added). This definition does not limit manufacturing operations to those done by hand, provided the operation meets the latter part of the definition. Therefore, a fabric-making process under the regulations includes those performed by machines. Whereby the fabric comprising the S-10”, S-12”, T-10”, and T-12” mattress covers are formed in a single country, that country will be considered the country of origin per § 102.21(c)(2) and (e)(2)(ii), as explained above.
HOLDING:
The country of origin for the S-10” and S-12” mattress covers is the United States.
The country of origin for the S-14” mattress cover is El Salvador.
The country of origin for the T-10” and T-12” mattress covers in which the component fabric is manufactured in China, is China.
The country of origin for the T-10” and T-12” mattress covers in which the component fabrics are manufactured in China and Mexico, is El Salvador.
EFFECT ON OTHER RULINGS:
NY N303580, dated April 10, 2019, is hereby MODIFIED in accordance with the above analysis.
In accordance with 19 U.S.C. § 1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
Craig T. Clark, Director
Commercial and Trade Facilitation Division