CLA-2 RR:CTF:TCM 968036 TMF
Leslie J. Milton
109 Broom Lane
Whickham, Newcastle Upon Tyne
NE16 4PT
United Kingdom
RE: Eligibility of Trousers Containing Elastomeric Fabric in Waistband
under CBTPA, ATPDEA, DR-CAFTA and NAFTA
Dear Mr. Milton:
This letter is in reply to your correspondence of December 22, 2005 in which you requested on behalf of your client, Pro-Fit, Inc., a binding ruling on certain elastomeric fabric that will be used in the waistbands of trousers. We received two samples from you.
FACTS:
Sample A
17.4% Nylon
57.3% Polyester
25.3% Elastane
Fabric is of knit construction and is coated with an adhesive. It has a soluble cord stitched through it.
Sample B
93% Polyester
7% Elastane
Fabric is of knit construction and is coated with an adhesive. It has a knit fabric tape fused to it. The tape is applied to the base fabric by an adhesive and has the following fiber content:
10.6% Nylon
30.6% Polyester
58.8% Elastane.
The tape has a soluble cord stitched through it.
Your client’s website states that the Pro-Fit Patented Systems enable a rigid fabric waistband to extend, creating stretch and improved comfort and fit in both men's and women's garments.
You state that the elasticity is held in tension by a cord sewn into the fabric throughout its length. The product is for pressing into trouser waistbands by heat bonding as the coating is an adhesive. You state that after washing, the threads that bind the cord dissolves, thereby releasing the elasticity it held in tension. You state this resolves the problem traditionally associated with fixing the tension in pre-formed elastomeric waistbands.
You describe the subject merchandise as coated elastomeric base fabric that will be manufactured in either Europe or Morocco in 100-meter lengths. You state that the product will be either imported into Guatemala or the United States. You indicate that your client sells this product to a U.S. customer who manufactures trousers in Guatemala. You state your client would like to deliver direct duty paid into Guatemala, but if necessary would deliver duty paid to the USA.
You also state that your client is seeking clients who have trousers manufactured under the following preference programs: the Caribbean Basin Trade Partnership Act (CBTPA), the Andean Trade Promotion and Drug Eradication Act (ATPDEA), North American Free Trade Agreement (NAFTA) and the new Dominican Republic-Central American Free Trade Agreement (DR-CAFTA). You believe that the products are composite items, not cut to size, but pieces of textile fabric. You also state that the goods have undergone some working intended for the manufacture of garments but are not yet sufficiently complete as to be identified as garments or garment parts. You state the goods are classifiable in heading 6307, HTSUSA.
You state that the European Economic Community determined that both products were classifiable within heading 6307, HS in GB 115196090 dated February 14, 2006 and GB 115024032, dated January 13, 2006. We note that GB 115053121, dated January 17, 2006 classified substantially similar fabric in heading 6002, HS.
In your submission, you also request a determination as to whether the goods are findings or trimmings.
ISSUE:
Whether the subject coated elastomeric fabrics, if used in trouser waistbands, are fabrics or findings or trimmings?
Whether trousers which contain the subject coated elastomeric fabrics in the waistband are precluded from eligibility for CBTPA, ATPDEA, DR-CAFTA and NAFTA preference?
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes. When goods cannot be classified solely on the basis of GRI 1 and if the terms of the headings and any relative section or chapter notes do not require otherwise, the remaining GRIs 2 through 6 may be applied.
Additionally, the Harmonized Commodity Description and Coding System Explanatory Notes (ENs) are the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
Samples A and B are classifiable in subheading 6002.40.8080, HTSUSA, which provides for “Knitted or crocheted fabrics of a width not exceeding 30 cm, containing by weight 5 percent or more of elastomeric yarn or rubber thread, other than those of heading 6001: Containing by weight 5 percent or more of elastomeric yarn but not containing rubber thread: Other…Other.”
You state that the merchandise is a made up article, we do not agree. Notes 7(b) and 7(e), Section XI state “[f]or the purposes of this section, the expression "made up" means:
(b) Produced in the finished state, ready for use (or merely needing separation by cutting dividing threads) without sewing or other working (for example, certain dusters, towels, tablecloths, scarf squares, blankets);
* * *
(e) Assembled by sewing, gumming or otherwise (other than piece goods consisting of two or more lengths of identical material joined end to end and piece goods composed of two or more textiles assembled in layers, whether or not padded)[.]
In this case, both samples are imported uncut, in 100 meter lengths on a roll, i.e., as piece goods. Neither sample is produced in the finished state, ready for use. With regard to sample B, consisting of a base fabric with attached tape, 7(e) does not apply as the merchandise falls within the exception for textile piece goods assembled in layers. With regard to both samples, they do not have any dedicated demarcation lines for individual waistbands. We believe that they may be used in other cases, besides waistbands, where gathering or elasticity configurations are necessary. Therefore, we find the subject merchandise is fabric.
Further, the two samples are substantially similar to the fabric substrates incorporated into the waistband of men’s twill pants in the case of HQ 965909, dated January 7, 2003. In HQ 965909, CBP determined that the substrate was not a finding or trimming but fabric for purposes of the CBTPA. In this case, we also find the subject merchandise is fabric and is not a finding or trimming under any of the preference programs.
We note that you cite to BTI decisions, which are informative but conflicting in their classification within both 6307 and 6002, HTSUSA.
CBTPA, ATPDEA, DR-CAFTA and NAFTA
You requested that we determine whether the subject elastomeric fabrics if used in trouser waistbands would disqualify the trousers from eligibility under CBTPA, ATPDEA, DR-CAFTA and NAFTA. We note that we will not rule as to whether the trousers are eligible for preferential treatment under these preference programs.
CBTPA Eligibility
The United States-Caribbean Basin Trade Partnership Act (CBTPA) provides certain specified trade benefits for countries of the Caribbean region. The Act extends North American Free Trade Agreement (NAFTA) duty treatment standards to non-textile articles that previously were ineligible for preferential treatment under the Caribbean Basin Economic Recovery Act (CBERA) and provides for duty-free and quota-free treatment for certain textile and apparel articles which meet the requirements set forth in Section 211 of the CBTPA (amended 213(b) of the CBERA, codified at 19 U.S.C. 2703(b)). Beneficiary countries are designated by the President of the United States after having met eligibility requirements set forth in the CBPTA. Eligibility for benefits under the CBTPA is contingent on designation as a beneficiary country by the President of the United States and a determination by the United States Trade Representative (USTR), published in the Federal Register, that a beneficiary country has taken the measures required by the Act to implement and follow, or is making substantial progress toward implementing and following, certain customs procedures, drawn from Chapter 5 of the NAFTA, that allow the United States to verify the origin of products. Once both these designations have occurred, a beneficiary country is entitled to preferential treatment provided for by the CBTPA. Guatemala was designated a beneficiary country by Presidential Proclamation 7351 of October 2, 2000, published in the Federal Register (65 Fed. Reg. 59329). It was determined to have met the second criteria concerning customs procedures by the USTR and thus eligible for benefits under the CBTPA effective October 2, 2000. See 65 Fed. Reg. 60236.
The provisions implementing the textile provisions of the CBTPA in the Harmonized Tariff Schedule of the United States (HTSUS) are contained, for the most part, in subchapter XX, Chapter 98, HTSUS (two provisions may be found in subheading 9802.00.80, HTSUS). The regulations pertinent to the textile provisions of the CBTPA may be found at §§10.221 through 10.228 of the Customs Regulations (19 CFR 10.221 through 10.228).
In this case, the subject fabrics are manufactured in Morocco or Europe. To be eligible for CBTPA preference, the garment must be made from fabrics formed either in the U.S. or a CBTPA beneficiary country with yarns formed in the U.S. The only exceptions to this would be for brassieres (9820.11.15), garments falling within the scope of the “short supply” provisions (9820.11.24 or 9820.11.27), and goods falling within the scope of the handloomed, handmade and folklore articles provision (9820.11.30). Therefore, the subject fabric, if used in the trouser waistbands, would render the trousers ineligible to receive CBTPA preference.
ATPDEA Eligibility
The Andean Trade Promotion and Drug Eradication Act (ATPDEA) provides certain specified trade benefits for Andean countries. These benefits include duty-free treatment to specified non-textile articles previously ineligible for preferential treatment under the Andean Trade Preference Act (ATPA), duty- and quota-free treatment of certain imports of tuna, and duty- and quota-free treatment for certain textile and apparel articles which meet the requirements set forth in Section 3103 of the ATPDEA (codified at 19 U.S.C. 3203(b)(3)). Beneficiary countries are designated by the President of the United States after having met the eligibility requirements of the ATPDEA. Presidential Proclamation 7616 of October 21, 2002, published in the Federal Register (67 Fed. Reg. 67284), proclaimed necessary changes to the Harmonized Tariff Schedule of the United States (HTSUS) to implement the ATPDEA and designated Bolivia, Colombia, Ecuador and Peru as ATPDEA beneficiary countries which had met the requirements of the ATPDEA relating to the implementation of certain customs procedures, drawn from Chapter 5 of the NAFTA, that allow the United States to verify the origin of products.
The provisions implementing the textile provisions of the ATPDEA in the HTSUS are contained, for the most part, in subchapter XXI, Chapter 98, HTSUS (one provision may be found in subheading 9802.00.80, HTSUS). The regulations pertinent to the textile provisions of the ATPDEA may be found at §§ 10.241 through 10.248 of the Customs Regulations (19 CFR 10.241 through 10.248).
For goods to receive ATPDEA preference, the apparel articles must be sewn or otherwise assembled in one or more of the beneficiary countries or the U.S., or both, from fabrics formed in the U.S. or an ATPDEA beneficiary country (with certain exceptions as previously mentioned in the CBTPA). In this case, you’ve indicated that the subject fabrics will be made in Morocco or Europe. Therefore, if used in the trouser waistbands, the subject fabrics would render the trousers ineligible to receive ATPDEA preference.
CAFTA Eligibility
For eligibility under DR-CAFTA, we refer to General Note (GN) 29, Chapter 62, Chapter rule 3, which applies to woven garments and states:
Chapter rule 3: Notwithstanding chapter rule 2 to this chapter, a good of this chapter, other than a good of headings 6207 through 6208 (for boxers, pajamas, and nightwear only), brassieres of subheadings 6212.10 or girls’ dresses of tariff items 6204.42.30 (other than corduroy), 6204.43.40 or 6204.44.40, containing fabrics of heading 6002 or subheading 5806.20 shall be considered originating only if such fabrics are both formed from yarn and finished in the territory of one or more of the parties to the Agreement.
General Note 29, Chapter 61, Chapter rule 3, similarly requires that for knit garments containing fabrics of heading 6002 or subheading 5806.20 to be considered originating such fabrics must be formed from yarn and finished in the territory of one or more of the parties to the agreement.
Therefore, in this case, the use of the subject fabric (which is not formed from yarn and finished in a DR-CAFTA beneficiary country), would render the trousers ineligible for DR-CAFTA preference.
NAFTA Eligibility
The subject fabric, if used in the waistband of trousers would not render the trousers ineligible for NAFTA preference. Eligibility for trousers is dependent upon the component that determines the classification of the good meeting the requirements for preferential treatment. For trousers, that component is generally the outer shell of the trousers.
HOLDING:
Samples A and B, which are both elastomeric fabrics, are classifiable in 6002.40.8080, which provides for “Knitted or crocheted fabrics of a width not exceeding 30 cm, containing by weight 5 percent or more of elastomeric yarn or rubber thread, other than those of heading 6001: Containing by weight 5 percent or more of elastomeric yarn but not containing rubber thread: Other…Other”, dutiable at 8 percent ad valorem, quota category number 222.
If Sample A or B are used in the waistbands of trousers, they would render the trousers ineligible for CBTPA, ATPDEA, and DR-CAFTA preference. Under NAFTA, sample A or B would not affect the eligibility of otherwise qualifying trousers.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUSA and the accompanying duty rates are provided on the world wide web at www.usitc.gov.
Quota/visa requirements are no longer applicable for merchandise which is the product of a World Trade Organization (WTO) member countries. The textile category number above applies to merchandise produced in non-WTO member-countries. Quota and visa requirements are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information on quota and visa requirements applicable to this merchandise, we suggest you check, close to the time of shipment, the “Textile Status Report for Absolute Quotas”, which is available on our web site at www.cbp.gov. For current information regarding possible textile safeguard actions and related issues, we refer you to the web site at the Office of Textiles and Apparel of the Department of Commerce at otexa.ita.doc.gov.
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 CBP officer handling the transaction.
Sincerely,
Gail A. Hamill, Chief
Tariff Classification and Marking Branch