MAR 2-OT:RR:NC:TA:349
Mr. John M. Peterson
Neville Peterson LLP
17 State Street, 19th Floor
New York, NY 10004
RE: Marking and Country of origin determination for cushions that are cut, sewn and filled in the United States from foreign fabric; 19 CFR 102.21(c)(2); tariff shift; 19 CFR 102.21(c)(5); last country where an important assembly or manufacturing process occurred
Dear Mr. Peterson:
This is in reply to your letter dated June 23, 2010, requesting a marking and country of origin determination for cushions that are cut, sewn and filled in the United States from foreign fabric. This request is made on behalf of Plantation Patterns Furniture Company.
FACTS:
The subject merchandise consists of cushions designed for use with patio furniture. The submitted sample, SKU 7113, has a 100 percent polyester woven fabric shell and is stuffed with one inch thick polyurethane foam covered with polyester fiber. It measures approximately 17 x 20 inches and 3.5 inches thick. There are self-fabric loops with hook and loop fasteners sewn to two corners. The loops are used to attach the cushion to the patio furniture. You have proposed two manufacturing scenarios. The manufacturing operations for the cushions are as follows:
Scenario 1: Polyester fabric is woven and finished in Taiwan. Polyurethane foam and polyester fiber are formed in China. All three items are shipped to the United States where the fabric is cut into top and bottom panels and they are sewn to form a cushion shell. The polyurethane foam is wrapped with the fiber (60 percent polyester, 40 percent polyurethane) and inserted into the shell. The shell is sewn closed. Labels are attached and the cushions are shipped to customers in the U.S.
Scenario 2: Polyester fabric for the top panel is woven and finished in Taiwan. Polyester fabric for the bottom panel is woven and finished in Country B. Polyurethane foam and polyester fiber is formed in China. All four items are shipped to the United States where the fabrics are cut into top and bottom panels and they are sewn to form a cushion shell. The polyurethane foam is wrapped with the fiber (60 percent polyester, 40 percent polyurethane) and inserted into the shell. The shell is sewn closed. Labels are attached and the cushions are shipped to customers in the U.S.
Plantation Patterns proposes to mark the Scenario 1 cushions with either of the following statements of origin:
“Cushion Filled, Sewn and Finished in the United States with Fabric Made in Taiwan” or
“Cushion Filled, Sewn and Finished in the United States, Country of Origin Taiwan.”
You believe that the cushions in Scenario 2 will be considered to originate in the United States and as such will not require country of origin marking under 19 U.S.C. §1304. You also note that Plantation Patterns is aware that a “Made in USA” marking may only be done in conformity with the rules and regulations of the Federal Trade Commission.
ISSUE:
What is the country of origin and are the proposed markings acceptable country of origin markings for the finished cushions?
CLASSIFICATION:
Although woven polyester fabric, polyurethane foam and polyester fiber are the actual products imported, this ruling request concerns the origin and marking of the finished product. The applicable subheading for the finished cushions will be 9404.90.2000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for mattress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with springs or stuffed or internally fitted with any material or of cellular rubber or plastics, whether or not covered: other: pillows, cushions and similar furnishings: other.
COUNTRY OF ORIGIN AND MARKING - LAW AND ANALYSIS:
The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was “that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will.” United States v. Friedlaender & Co. Inc. 27 CCPA 297, 302, C.A.D. 104 (1940).
Part 134, Customs Regulations (19 CFR Part 134), implements country of origin marking requirements and exceptions of 19 U.S.C. 1304. As cited above, the marking statute specifically states that “every article of foreign origin (or its container) imported into the U.S. ... shall be marked ... in such a manner as to indicate to the ultimate purchaser in the U.S. ... the country of origin of the article.” In this case, the articles imported into the U.S. are the foreign-origin fabric, plastic foam and fiber. In order to determine whether the imported foreign-origin fabric, plastic foam and fiber, after they have been used to make cushions, remain an article of foreign origin for purposes of the marking requirements under 19 U.S.C. 1304, Customs must apply the statutory rules of origin set forth in section 334 of the Uruguay Round Agreements Act. In HQ 559625 dated January 19, 1996, the marking of down comforters produced in the U.S. from imported Chinese origin comforter shells was considered. Without reiterating the law and rationale applied in HQ 559625, it was held that since section 334 applies “for purposes of the customs laws” and 19 U.S.C. 1304 is a Customs law, section 334 must be applied to determine the country of origin of the down comforters finished in the U.S. for purposes of 19 U.S.C. 1304.
Section 334 of the Uruguay Round Agreements Act (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provided rules of origin for textiles and apparel entered, or withdrawn from warehouse for consumption, on and after July 1, 1996. Section 102.21, Customs Regulations (19 C.F.R. 102.21), published September 5, 1995 in the Federal Register, implements Section 334 (60 FR 46188). Section 334 of the URAA was amended by section 405 of the Trade and Development Act of 2000, enacted on May 18, 2000, and accordingly, section 102.21 was amended (68 Fed. Reg. 8711). Thus, the country of origin of a textile or apparel product shall be determined by the sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.
Paragraph (c)(1) states, “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, “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 of the foreign materials 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) in pertinent part states,
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:
HTSUS Tariff shift and/or other requirements
9404.90 Except for goods of subheading 9404.90 provided for in paragraph (e)(2) of this section, the country of origin of a good classifiable under subheading 9404.90 is the country, territory or insular possession in which the fabric comprising the good was formed by a fabric-making process.
Subheading 9404.90.20 is not included in the paragraph (e)(2) exception to the above tariff shift rule. The cushions are made from fiber, foam and a textile shell. In Scenario 1 the shell is made from a fabric that was formed in a single country. As the fabric comprising the cushions is formed in a single country, that is, Taiwan, as per the terms of the tariff shift requirement, country of origin for the Scenario 1 cushions is conferred in Taiwan.
The shell for the Scenario 2 cushions consists of top panel fabric made in Taiwan and bottom panel fabric made in Country B. Accordingly, as the fabrics comprising the cushions are not formed in a single country, Section 102.21(c)(2) is inapplicable.
Section 102.21(c)(3) states,
Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) or (2) of this section:
(i) If the good was knit to shape, the country of origin of the good is the single country, territory, or insular possession in which the good was knit; or
(ii) Except for goods of heading 5609, 5807, 5811, 6213, 6214, 6301 through 6306, and 6308, and subheadings 6209.20.5040, 6307.10, 6307.90, and 9404.90, if the good was not knit to shape and the good was wholly assembled in a single country, territory, or insular possession, the country of origin of the good is the country, territory, or insular possession in which the good was wholly assembled.
As the subject merchandise is not knit to shape and subheading 9404.90, HTSUS, is excepted from provision (ii), Section 102.21 (c)(3) is inapplicable.
Section 102.21 (c)(4) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2) or (3) of this section, the country of origin of the good is the single country, territory or insular possession in which the most important assembly or manufacturing process occurred.” In the case of the subject merchandise, the most important manufacturing process occurs at the time of fabric making. Basing the country of origin determination on the fabric making process as opposed to the assembly process carries out the clear intent of Section 334 as expressed in Section 334(b)(2). In the case of the instant cushions, the fabric making process of the outer shell constitutes the most important manufacturing process. It is the outer shell which actually forms the merchandise. However, the fabrics for the shell of the Scenario 2 cushions are sourced in more than one country. As no one fabric is more important than the other, a single country of origin determination cannot be made based on Section 102.21(c)(4).
Paragraph (c)(5) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2), (3) or (4) of this section, the country of origin of the good is the last country, territory or insular possession in which an important assembly or manufacturing process occurred.” Accordingly, in the case of the Scenario 2 cushions, country of origin is conferred by the last country in which an important assembly or manufacturing process occurred, that is, the United States.
Plantation Patterns has proposed to mark the Scenario 1 cushions with the phrase “Cushion Filled, Sewn and Finished in the United States with Fabric Made in Taiwan” or “Cushion Filled, Sewn and Finished in the United States, Country of Origin Taiwan.” According to Section 334 of the URAA and 19 CFR 102.21, the country of origin of the Scenario 1 finished cushions is the country where the imported fabric is made by a fabric-making process, then pursuant to 19 U.S.C. 1304 we find that the imported foreign-origin fabric remains foreign when further processed into cushions in the U.S. in the manner described above.
Section 134.46, Customs Regulations (19 CFR 134.46), requires that when the words “United States,” “American,” the letters “U.S.A.,” any variation of such words or letters, or the name of any city or locality in the United States, or the name of any foreign country or locality which is not the country of origin appears on the imported article or its container the name of the country of origin shall appear legibly, permanently, in close proximity, and in at least comparable size, preceded by the additional words “Made in,” “Product of,” or other words of similar meaning. The purpose of this section is to prevent the possibility of misleading or deceiving the ultimate purchaser.
Accordingly, since the fabric's country of origin remains foreign, for purposes of 19 U.S.C. 1304, the article which reaches the ultimate purchaser must indicate that the fabric is a product of a foreign country. In regard to the proposed marking “Cushion Filled, Sewn and Finished in the United States with Fabric Made in Taiwan” we find that the requirements of 19 CFR 134.46 are satisfied. Since the country of origin of the fabric will be preceded by “Made in,” and the marking will indicate to the ultimate purchaser that the article imported into the U.S. is of foreign origin, we find that the marking “Cushion Filled, Sewn and Finished in the United States with Fabric Made in Taiwan” on the finished cushions will be an acceptable country of origin marking for the finished cushions under 19 U.S.C. 1304.
We believe that the other proposed marking “Cushion Filled, Sewn and Finished in the United States, Country of Origin Taiwan” may be confusing to the ultimate purchaser. Although it does indicate “Country of Origin Taiwan” it does not specifically refer to the imported fabric nor does it directly indicate that the cushion itself is considered to be a product of Taiwan. This phrase is not acceptable for marking purposes. We note that as the origin of the Scenario 1 cushions per 19 CFR 102.21 was determined to be Taiwan, the cushions may also be marked “Made in Taiwan” or “Made in Taiwan Sewn and Stuffed in the U.S.”
The country of origin of the Scenario 2 cushions is the United States following the above analysis. They are not required to be marked as a foreign article for purposes of 19 U.S.C. 1304. The marking statute only requires articles of foreign origin imported into the United States to be marked to indicate to the ultimate purchaser in the United States the country of origin of the article.
As you noted in your letter, marking the Scenario 2 cushions “Made in USA” is an issue under the authority of the Federal Trade Commission. Additionally, separate Federal Trade Commission marking requirements exist regarding country of origin, fiber content, and other information that must appear on many textile items. For more information on the applicability of the requirements under the Textile Fiber Products Identification Act (TFPIA) and the “Made in USA” marking, you should contact the Federal Trade Commission, Textile Program, Division of Enforcement, Bureau of Consumer Protection, 600 Pennsylvania Avenue, N.W., Washington, D.C., 20580.
HOLDING:
The country of origin of the Scenario 1 cushions is Taiwan. The proposed marking “Cushion Filled, Sewn and Finished in the United States with Fabric Made in Taiwan” is acceptable country of origin marking for the finished cushions produced in the United States from Taiwanese origin fabric.
The country of origin for the Scenario 2 cushions is the United States. They are not required to be marked as a foreign article for purposes of 19 U.S.C. 1304.
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, either directly, by reference, or by implication, is accurate and complete in every material respect.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). 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.
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist John Hansen at (646) 733-3043.
Sincerely,
Robert B. Swierupski
Director
National Commodity Specialist Division