CLA-2 R:C:S 558650 DEC
Ms. Patricia M. Hanson
Katten Muchin & Zavis
525 West Monroe Street
Suite 1600
Chicago, Illinois 60661-3693
RE: U.S. Note 2(b), subchapter II, chapter 98, HTSUS; T.D. 91-88
Dear Ms. Hanson:
This is in response to your letter dated July 28, 1994, and your supplemental
letter of July 27, 1995, requesting a ruling on whether certain non-woven disposable
apparel is entitled to duty-free treatment under U.S. Note 2(b), subchapter II, Chapter
98, Harmonized Tariff Schedule of the United States (HTSUS) (Note 2(b)).
FACTS:
Your client, Baxter Healthcare Corporation of Illinois (Baxter), intends to import
non-woven disposable apparel items including sleeves, aprons, frocks, smocks, lab
coats, and coveralls that are made of Tyvek fabric. You state that the Tyvek material is
an impermeable non-woven fabric manufactured by the Dupont Corporation in the
United States.
Baxter intends to send the Tyvek material in bulk to Costa Rica where it will be
cut to shape and assembled into finished disposable garments. You indicated that the
finished articles will be used in clean rooms, hospitals, clinics, laboratories, and
contaminated areas. In Headquarters Ruling Letter (HRL) 085419, dated January 26,
1990, Customs ruled that non-woven coveralls made from Tyvek that were designed for
use in hospitals, clinics, laboratories or contaminated areas were classifiable under
subheading 6210.10.4010, HTSUS.
The 1995 HTSUS deleted subheading 6210.10.40, HTSUS, and added the
following provisions:
6210.10.50 Nonwoven disposable apparel designed
for use in hospitals, clinics, laboratories or
contaminated areas
Other:
6210.10.70 Disposable briefs and panties designed for
one-time use
6210.10.90 Other
10 Overalls and
coveralls............(659)
40 Other................(659).
Subheading 6210.10.50, HTSUS (1995), contains the exact language of subheading
6210.10.4010, HTSUS (1994). The rate of duty was lowered from 17% to 5.6%.
Articles that were previously classified under subheading 6210.10.4010, HTSUS
(1994), or are now classified under subheading 6210.10.50, HTSUS (1995), are not
subject to quota.
You state that the Tyvek material is manufactured in the United States and is of
100% U.S. origin. In addition, you state that all of the minor components (thread,
zippers, fasteners, elastic, rubber tape, and adhesive) used in the production of the
apparel items noted above are of United States origin. All materials used to make the
disposable articles are shipped directly from the United States to Costa Rica and the
finished articles are shipped directly to the United States without entering the
commerce of any foreign country.
ISSUE:
Whether the apparel that is manufactured as described above is eligible for
duty-free treatment under Note 2(b).
LAW AND ANALYSIS:
Section 222 of the Customs and Trade Act of 1990 (Public Law 101-382)
amended U.S. Note 2, subchapter II, Chapter 98, HTSUS, to provide for the duty-free
treatment of articles (other than textile and apparel articles, petroleum and petroleum
products) which are assembled or processed in a Caribbean Basin Economic Recovery
Act (CBERA) beneficiary country (BC) wholly of fabricated components or ingredients
(except water) of U.S. origin. This amendment was effective with respect to goods
entered on or after October 1, 1990.
Note 2(b) provides as follows:
(b) No article (except a textile article, apparel article, or petroleum, or
any product derived from petroleum, provided for in heading 2709
or 2710) may be treated as a foreign article, or as subject to duty, if--
(I) the article is--
(A) assembled or processed in whole of fabricated components
that are a product of the United States, or
(B) processed in whole of ingredients (other than water) that are
a product of the United States, in a beneficiary country; and
(ii) neither the fabricated components, materials or ingredients, after
exportation from the United States, nor the article itself, before
importation into the United States, enters the commerce of any
foreign country other than a beneficiary country.
As stated in this paragraph, the term "beneficiary country" means a
country listed in General Note 3(c)(v)(A).
Although Note 2(b)(I)(A) and (B) are separated by the word "or", it is our opinion
that Congress did not intend to preclude free treatment under this provision to an article
which is created in a BC both by assembling and processing U.S. fabricated
components and by processing U.S. ingredients.
Pursuant to General Note 7(a), HTSUS, Costa Rica has been designated as a
BC for CBERA purposes. Note 2(b) specifies four categories of products which are
excluded from duty- free treatment under this provision: textile articles; apparel articles;
petroleum; and certain products derived from petroleum. In this regard, for purposes of
Note 2(b), Customs has held that "textile" and "apparel" articles are articles classified in
provisions of the HTSUS which include a textile category number, i.e., are subject to
textile agreements. See T.D. 91-88, dated October 18, 1991.
The subject articles (sleeves, aprons, frocks, smocks, lab coats, and coveralls)
are classifiable under subheading 6210.10.50, HTSUS (1995), which contains the
exact language from subheading 6210.10.4010, HTSUS (1994). This provision does
not include a textile category number, and therefore these articles are not considered a
textile or apparel article for purposes of Note 2(b). Since the subject articles are
processed in a BC wholly of fabricated components of U.S. origin, it qualifies for
duty-free treatment under Note 2(b), HTSUS.
HOLDING:
Based on the information provided, since the Tyvek material and all of the minor
components (thread, zippers, fasteners, elastic, rubber tape, and adhesive) are of U.S.
origin, the materials used to make the disposable articles are shipped directly from the
United States to Costa Rica, and the finished articles are shipped directly to the United
States without entering the commerce of any foreign country, the articles will qualify for
duty-free treatment under Note 2(b) assuming compliance with the documentation
requirements set forth in Headquarters telex 9264071, dated September 28, 1990.
A copy of this ruling letter should be attached to the entry documents filed at the
time this merchandise is 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, Commercial Rulings Division