HQ 081642
April 28 1989
CLA 2 CO:R:C:G 081642 DSN
David C. Williams, Esquire
8 Brook Lane
Peekskill, New York 10566
RE: Country of origin determination for certain cotton panties
Dear Mr. Williams:
This letter is in response to your inquiry of January 4, 1988, on behalf of Shalvin Industries, in which you requested a country of origin determination for women's cotton underwear, assembled in Thailand from pre cut components produced in Israel.
Samples were furnished for examination.
FACTS:
The samples submitted are all women's 100 percent cotton knit panties manufactured in Israel, from parts assembled in Thailand. One sample includes the parts of the panties prior to
exportation from Israel to Thailand. Another sample shows a completed pair of underwear. The last sample which is also completed is marked in ink to identify where the sewing takes
place. You indicate in your submissions, that the parts are cut in Israel and the cut to length elastic will be made ready for assembly in Israel. You note that the knit cotton fabric and in
some cases lace inserts will be made and bleached in Israel. These parts will be shipped to Thailand where they will be sewn into panties. The panties will then be returned to Israel for
inspection and packing. It has not been determined in which country the labels will be applied to the finished product.
According to your cost figures, 15 percent of the dutiable value is attributable to sewing costs in Thailand, while 85 percent of the dutiable value is incurred Israeli costs.
ISSUE:
What is the country of origin of underwear produced in Israel and assembled in Thailand?
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LAW AND ANALYSIS:
The country of origin of textile products is determined by applying Section 12.130 of the Customs Regulations. Pursuant to Section 12.130(b), a textile or textile product which consists of materials produced or derived from, or processed in, more than one foreign territory or country, shall be a product of that foreign territory or country where it last underwent a
substantial transformation. A textile or 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(e)(2)(ii), provides that an article or material usually will not be considered to be a product of a
particular foreign territory or country by virtue of merely trimming and or joining together by sewing, looping, or other means of attaching otherwise completed knit to shape component
parts produced in a single country, even when accompanied by other processes such as washing, drying, or mending, which are normally incident to the assembly process.
Based on your submissions, the operation in Thailand of sewing the components parts into panties is a relatively simple procedure. These assembly operations are not considered
substantial in terms of skill required and relative costs. Therefore, the assembly of the panties in Thailand has not substantially transformed the Israeli components.
HOLDING:
The country of origin for Customs purposes of the subject underwear is Israel.
Sincerely,
John Durant, Director
Commercial Rulings Division