CLA-2 RR:TC:TE 959672 jb
Brian Wavra
Rainfair, Inc.
Box 1647
Racine, Wis 53401
RE: Country of origin determination for bib apron and sleeve
protector; 19 CFR 102.21(c)(2); tariff shift
Dear Mr. Wavra:
This is in reply to your letter, dated July 15, 1996,
requesting a country of origin determination for a bib apron and
sleeve protector which will be imported into the United States.
Samples were submitted to this office for examination and will be
returned under separate cover.
FACTS:
The subject merchandise consists of a bib apron and sleeve
protector made of 100 percent denim cotton fabric. The bib apron
measures approximately 36 inches in length and 26 inches in width
at the waist, tapers from the waist to the chest and is tied at
the neck by fabric straps which can be affixed to metal grommets
on each side at the top of the bib. The apron also features one
pocket, chest high and another pocket at the waist. Fabric
straps can also be affixed to metal grommets at each side at the
waist, allowing the apron to be tied at the waist. This garment
provides coverage from the chest to below the knees.
The sleeve protector features elasticized open ends at both
ends and when worn, provides coverage from the wrist to the
elbow. Our New York office issued to you New York Ruling Letter
(NY) A85787, dated August 8, 1996, discussing the proper tariff
classification for this merchandise.
The manufacturing operations are as follows:
UNITED STATES
- fabric is formed.
MEXICO or a participating country of the CARIBBEAN BASIN
ECONOMIC RECOVERY ACT (CBI)
- cutting of the component pieces (for the apron, cutting to
shape the apron shell and pockets; for the sleeve
protector, cutting to shape the sleeve shell and elastic);
- sewing;
- assembly.
ISSUE:
1. If assembly occurs in Mexico, is the subject merchandise
eligible for duty-free treatment under the North American
Free Trade Agreement (NAFTA)?
2. If assembly occurs in the CBI country, is the subject
merchandise eligible for duty-free treatment as per U.S.
Note 2(b), Subchapter II, Chapter 98, Harmonized Tariff
Schedule of the United States (HTSUS)?
3. What is the country of origin of the subject merchandise?
LAW AND ANALYSIS:
NAFTA eligibility
In the situation where the subject bib apron and sleeve
protector undergo processing operations in Mexico, Mexico is a
party to the North American Free Trade Agreement (NAFTA).
General Note 12, HTSUS, incorporates Article 401 of the NAFTA
into the HTSUSA. Note 12(a) provides, in pertinent part:
* * *
(ii) Goods that originate in the territory of a NAFTA party
under subdivision (b) of this note and that
qualify to be marked as goods of Mexico under the terms of
the marking rules... and are entered under a
subheading for which a rate of duty appears in the
"Special" subcolumn followed by the symbol "MX" in
parentheses, are eligible for such duty rate... .
[Emphasis added]
Accordingly, the bib apron and sleeve protector at issue will be
eligible for the "Special" "MX" rate of duty provided they are
NAFTA originating goods under General Note 12(b), HTSUSA, and
they qualify to be marked as goods of Mexico. Note 12(b)
provides in pertinent part,
For the purposes of this note, goods imported into the
customs territory of the United States are eligible for the
tariff treatment and quantitative limitations set forth in
the tariff schedule as "goods originating in the territory
of a NAFTA party" only if--
(i) they are goods wholly obtained or produced entirely in
the territory of Canada, Mexico and/.or the United
States; or
(ii) they have been transformed in the territory of
Canada, Mexico and/or the United States so that--
(A) except as provided in subdivision (f) of this note,
each of the non-originating materials used in
the production of such goods undergoes a change in tariff
classification described in subdivisions (r), (s) and
(t) of this note or the rules set forth therein,
or,
(B) the goods otherwise satisfy the applicable
requirements of subdivisions (r), (s) and (t) where
no change in tariff classification is required, and the goods
satisfy all other requirements of this note;
or
(iii) they are goods produced entirely in the territory
of Canada, Mexico and/or the United States exclusively
from originating materials; or
* * *
As the subject bib apron and sleeve protector are
constructed in Mexico of materials wholly obtained or produced in
the United States, they meet the criteria set out in General Note
12(b)(i). Accordingly, the bib apron and sleeve protector
qualify as goods originating in the territory of a NAFTA party.
Assuming that the bib apron and sleeve protector qualify to be
marked as goods of Mexico, they are entitled to the special "MX"
duty rate, provided that a Certificate of Origin is completed and
submitted in accordance with 19 CFR 181.11.
Duty Free Treatment for the CBI country pursuant to U.S. Note 2,
Subchapter 2, Chapter 98, HTSUS
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, and 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.
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
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 bib apron and sleeve protector are classifiable
in subheadings 6211.42.0081, and 6217.10.9010, HTSUSA,
respectively. These provisions include a textile category
number, that is, 359 for both garments, and therefore these
articles are considered textile or apparel articles for purposes
of Note 2(b). Accordingly, the subject bib apron and sleeve
protector do not qualify for duty-free treatment.
Country of origin
On December 8, 1994, the President signed into law the
Uruguay Round Agreements Act. Section 334 of that Act (codified
at 19 U.S.C. 3592) provides new rules of origin for textiles and
apparel entered, or withdrawn from warehouse, for consumption, on
and after July 1, 1996. On September 5, 1995, Customs published
Section 102.21, Customs Regulations, in the Federal Register,
implementing Section 334 (60 FR 46188). Thus, effective July 1,
1996, the country of origin of a textile or apparel product shall
be determined by sequential application of the general rules set
forth in paragraphs (c)(1) through (5) of Section 102.21.
Paragraph (c)(1) states 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 merchandise is not wholly obtained or
produced in a single country, territory or insular possession,
paragraph (c)(1) of Section 102.21 is inapplicable.
Paragraph (c)(2) states that "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
foreign material 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".
Paragraph (e) states that "The following rules shall apply
for purposes of determining the country of origin of a textile or
apparel product under paragraph (c)(2) of this section:"
6210-6212 If the good consists of two or more component
parts, a change to an assembled good of heading
6210 through 6212 from unassembled
components, provided that the change is the result of the good being wholly assembled in a single country,
territory, or insular possession.
6215-6217 If the good consists of two or more component
parts, a change to an assembled good of
heading 6215 through 6217 from unassembled
components, provided that the change is the
result of the good being wholly assembled in
a single country, territory or insular
possession.
The subject bib apron and sleeve protector are classified in
headings 6211 and 6217, HTSUS, respectively. As the subject
merchandise consists of multiple component parts (for the apron,
the apron shell and pockets; for the sleeve protector, the sleeve
shell and elastic) which are assembled in a single country into
the finished goods, the country of origin of the subject bib
apron and sleeve protector is the single country where that
assembly occurs, that is, Mexico or the CBI country.
HOLDING:
The country of origin of the subject bib apron and sleeve
protector is Mexico or the CBI country.
In the case where assembly occurs in Mexico, the bib apron
is eligible for the NAFTA "MX" special duty rate of "Free", and
the sleeve protector is eligible for the NAFTA "MX" special duty
rate of 7.8 percent ad valorem.
In the case where assembly occurs in the CBI country, the
merchandise is not eligible for duty-free treatment.
The holding set forth above applies only to the specific
factual situation and merchandise identified in the ruling
request. This position is clearly set forth in section 19 CFR
177.9(b)(1). This section states that a ruling letter is issued
on the assumption that all of the information furnished in the
ruling letter, either directly, by reference, or by implication,
is accurate and complete in every material respect.
Should it be subsequently determined that the information
furnished is not complete and does not comply with 19 CFR
177.9(b)(1), the ruling will be subject to modification or
revocation. In the event there is a change in the facts
previously furnished, this may affect the determination of
country of origin. Accordingly, if there is any change in the
facts submitted to Customs, it is recommended that a new ruling
request be submitted in accordance with 19 CFR 177.2.
Sincerely,
John Durant, Director
Tariff Classification Appeals
Division