CLA-2 CO:R:C:T 950817 PR
Mr. D. Michael Thomas
International Forwarders, Inc.
P.O. Box 32428
Charleston, SC 29417-2428
RE: Modification of NYRL 867003; Classification of Embroidered
Motifs, Patches and Emblems; Embroidery Without Visible
Ground
Dear Mr. Kuehler:
New York Ruling Letter 867003, addressed to you, concerned
the classification of an embroidered patch. We have had occasion
to review that ruling and have found it to be legally incorrect.
FACTS:
The merchandise in NYRL 867003 was classified under the
provision for embroidered motifs without a visible ground, in
subheading 5810.10.0000, Harmonized Tariff Schedule of the United
States Annotated (HTSUSA). That merchandise is described in NYRL
867003 as follows:
* * * an embroidered patch that is intended to be
attached to shirts, jackets or uniforms. The patch is
made of 100% polyester embroidery threads and 100%
polyester backing. * * * The motif's embroidery
threads completely obscure the underlying ground fabric
on both the face and back sides.
ISSUE:
The issue presented is whether the embroidered patch, which
has a base fabric that is completely covered is classifiable
under a provision for embroidery without visible ground. LAW AND ANALYSIS:
Under the Tariff Schedules of the United States Annotated
(TSUSA), the predecessor to the HTSUSA, it was Customs position
that this type of merchandise was not considered to be
embroidered. This is because embroidery, under the TSUSA, was
stitching which, except for burnt-out lace, decorated a base
fabric. If the base fabric was completely obscured or the
stitching actually created the article, as opposed to decorating
it, then that stitching was not embroidery. Numerous judicial
decisions and dictionary definitions supported that position
(e.g., see United States v. Field & Co., 10 Ct. Cust. Appls. 183,
T.D. 38550 (1920), and ORR Ruling 75-163, Headquarters Ruling
Letter (HRL) 040281, dated September 2, 1975).
However, the HTSUSA is an international based tariff and
terms which had specific meanings under the TSUSA may, in the
international context, have different meanings. The Harmonized
Commodity Description and Coding System, Explanatory Notes, which
are the official interpretation of the HTSUSA at the
international level (for the 4 digit headings and the 6 digit
subheadings), state:
Embroidery is obtained by working with embroidering
threads on a pre-existing ground of * * * woven fabric
* * * in order to produce an ornamental effect on that
ground. * * * The ground fabric usually forms part of
the completed embroidery, but in certain cases it is
removed (e.g., chemically or by cutting) after being
embroidered and only the design remains. (at pg. 808)
This language may be interpreted as implying that the TSUSA
rule was being carried over to the HTSUSA. However, the
Explanatory Notes go on to state:
The embroidery classified here comprises mainly the
following three groups.
(I) EMBROIDERY WITHOUT VISIBLE GROUND
This is embroidery in which the ground fabric has
been eliminated (e.g., by chemical process, by cutting
out). Thus the material consists entirely of the
embroidered designs * * * [I]t has no background * * *
(II) EMBROIDERY WITH THE GROUND RETAINED AFTER EMBROIDERING
This is embroidery in which the embroidering thread
does not usually cover the whole of the ground fabric.
* * *
(III) APPLIQUE
This consists of a ground of textile fabric or felt
on which are sewn, by embroidery or ordinary stitches:
* * *
(B) Ornamental motifs * * *
* * *
All varieties of embroidery described remain within
this heading when in the following forms:
* * *
(2) In the form of motifs, i.e., individual
pieces of embroidered design serving no other function
than to be incorporated or appliqued as elements of
embroidery in, for example, underwear or articles of
apparel or furnishings. They include badges, emblems,
"flashes", initials, numbers, stars, national or
sporting insignia, etc.
The Explanatory Notes make it quite clear that merchandise
such as the subject patches was intended to be classified as part
of the "Applique Work" group of embroidery. There is no
ambiguity in the description of merchandise intended to be
classified as "Embroidery without visible ground". It is
"embroidery in which the ground fabric has been eliminated." In
addition, it is apparent from the description for "Embroidery
with the ground retained after embroidering" that the subject
patches were not intended to be included in that grouping.
The description for "Applique Work" embroidery explicitly
describes the instant goods--"badges, emblems," and similar
articles, and states that the design may be made by embroidery or
ordinary stitches.
It is equally evident that the TSUSA concept of embroidery
was not intended to be carried forward into the HTSUSA. If
"Embroidery Without Visible Ground" only includes embroidery
where the ground has been removed, and "Embroidery With The
Ground Retained" describes embroidery where the "embroidering
thread does not usually cover the whole of the ground fabric",
then the only thing left for "Applique Work" embroidery to
include (in regard to ornamental motifs) must, by default, be
where the ground fabric has been retained but is no longer
visible (unlike embroidery under the TSUSA). Based on the plain
wording of the Explanatory Notes, no other reasonable conclusion
exists.
HOLDING:
Accordingly, the merchandise ruled upon in NYRL 867003 is
not classifiable as embroidery without visible ground. The
proper classification of this merchandise is under the provision
for other embroidered motifs of man-made fibers, in subheading
5810.92.0040, HTSUSA, with duty at the rate of 8.4 percent ad
valorem. Currently, there is no textile restraint category
designation applicable to this merchandise.
In order to insure uniformity in Customs classification of
this merchandise and eliminate uncertainty, pursuant to Section
177.9(d)(1), Customs Regulations (19 CFR 177.9(d)(1)), NYRL
867003 is modified to reflect the above classifications effective
with the date of this letter. If, after your review, you
disagree with the legal basis for our decision, we invite you to
submit any arguments you may have with respect to this matter.
Any submission you wish to make should be received within 30 days
of the date of this letter.
This modification is not retroactive. However, NYRL 867003
will not be valid for importations of the subject patches
arriving in the United States after the date of this notice. We
recognize that pending transactions may be adversely affected
(i.e. NYRL 867003 will not be applicable to merchandise
previously ordered and arriving in the United States subsequent
to this modification). If it can be shown that you relied on
NYRL 867003 to your detriment, you may apply to this office for
relief. However, you should be aware that in some instances
involving import restraints, such relief may require separate
approvals from other government agencies.
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories applicable to textile
merchandise, you should contact your local Customs office prior
to importation of this merchandise to determine the current
status of any import restraints or requirements.
The designated textile and apparel category may be
subdivided into parts. If so, visa and quota requirements
applicable to the subject merchandise may be affected. Since
part categories are the result of international bilateral
agreements which are subject to frequent renegotiations and
changes, to obtain the most current information available, we
suggest that you check, close to the time of shipment, the Status
Report On Current Import Quotas (Restraint Levels), an internal
issuance of the U.S. Customs Service, which is available for
inspection at your local Customs office.
Sincerely,
John Durant, Director
Commercial Rulings Division