CLA-2-RR:NC:TA:361 K80820
Ms. Stacy Bauman
American Shipping Company, Inc.
140 Sylvan Avenue
Englewood Cliffs, NJ 07632
RE: Classification and country of origin determination for woman’s woven pants; Duty-Free treatment for products of the West Bank, Gaza Strip, or a Qualifying Industrial Zone; General Note 3(a)(v); duty-free treatment for products of the under the United States-Jordan Free Trade Area Implementation Act; General Note 18; TD 91-7
Dear Ms. Bauman:
This is in reply to your letter dated December 2, 2003, submitted on behalf of your client Dress Barn Inc. Your request concerns the classification, and eligibility for preferential duty treatment for a garment that may be produced, in part, in a Qualifying Industrial Zone (QIZ), or in accordance with the United States-Jordan Free Trade Area Implementation Act.
FACTS:
The pants, style DB3215, are constructed from 100 percent polyester woven fabric with a 100 percent polyester woven lining. The pants have a partially elasticized waistband with belt loops, a front fly zipper, a button at the waistband that closes in the left-over-right direction, side seam pockets, and hemmed leg openings. The pants will be imported with either a self fabric textile belt or a polyurethane belt.
Chapter 62, note 8 states, in part:
Garments of this chapter designed for left over right closure at the front shall be regarded as men's or boys' garments, and those designed for right over left closure at the front as women's or girls' garments. These provisions do not apply where the cut of the garment clearly indicates that it is designed for one or other of the sexes.
As the pants have a left over right front closure, the presumption is that they will be for men. However, it is clear based on the cut that they were designed for women. Therefore, the pants will be classified as a woman’s garment.
You have indicated that the garment will be produced either in Jordan or in an approved “Qualifying Industrial Zone.” The manufacturing operations for the shirt will be done in accordance with one of the following scenarios:
SCENARIO A
China
Fabric is woven
Waistband elastic is formed
Pocketing fabric is formed
Polyurethane belt is wholly made into a finished product
Jordan or QIZ
Body fabric is cut into components
Elastic is cut into components
All assembly of the pants is completed
All finishing operations are completed in Jordan, garment with Chinese origin polyurethane belt is shipped directly to the US.
SCENARIO B
China
Fabric is woven
Waistband elastic is formed
Pocketing fabric is formed
Self-fabric belt is wholly made into a finished product
Jordan or QIZ
Body fabric is cut into components
Elastic is cut into components
All assembly of the pants is completed
All finishing operations are completed in Jordan, garment with Chinese origin self-fabric belt is shipped directly to the US.
SCENARIO C
China
Fabric is woven
Waistband elastic is formed and cut to length
Pocketing fabric is formed; pockets are made
Polyurethane belt is wholly made into a finished product
Jordan or QIZ
Body fabric is cut into components
All assembly of the pants is completed
All finishing operations are completed in Jordan, garment with Chinese origin polyurethane belt is shipped directly to the US.
SCENARIO D
China
Fabric is woven
Waistband elastic is formed and cut to length
Pocketing fabric is formed; pockets are made
Self-fabric belt is wholly made into a finished product
Jordan or QIZ
Body fabric is cut into components
All assembly of the pants is completed
All finishing operations are completed in Jordan, garment with Chinese origin self-fabric belt is shipped directly to the US.
ISSUE:
What are the classification, status under the US-Israel Free Trade Agreement, and status under the United States-Jordan Free Trade Area Implementation Act of the subject merchandise?
CLASSIFICATION:
The pants and polyurethane belt fall within the description of "sets" as provided in the Explanatory Notes. The pants and belt consist of at least two different articles which are, prima facie, classifiable in different headings; consist of products or articles put up together to meet a particular need or carry out a specific activity; and are put up in a manner suitable for sale directly to users without re-packing. As the belt is an accessory to the pants, the essential character of the set is imparted by the pants.
The pants and self fabric belt are sold at retail as a unit and are considered to be a composite good. They are adapted to each other, are mutually complementary and together form a whole which would not normally be offered for sale in separate parts. The essential character of the pants and self-fabric belt is imparted by the pants.
The applicable subheading for the pants and polyurethane belt set, as well as the pants and self-fabric belt composite will be 6204.63.3510, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for Women’s…trousers…: Of man-made fibers. The general rate of duty is 28.8% ad valorem. Effective January 1, 2004, the general rate of duty will be 28.6% ad valorem.
The pants of the pants/polyurethane belt set fall within textile category designation 648; the pants and textile belt composite, as a unit, fall within textile category designation 648. The designated textile and apparel categories and their quota and visa status are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information, we suggest that you check, close to the time of shipment, the U.S. Customs Service Textile Status Report, an internal issuance of the U.S. Customs Service, which is available at the Customs Web Site at WWW.CBP.GOV. In addition, the designated textile and apparel categories may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected and should also be verified at the time of shipment.
STATUS UNDER THE UNITED STATES-ISRAEL FREE TRADE AGREEMENT:
Pursuant to the authority conferred by section 9 of the U.S.-Israel Free Trade Area Implementation Act of 1985 (19 U.S.C. §2112 note), the President issued Proclamation No. 6955 dated November 13, 1996 (published in the Federal Register on November 18, 1996 (61 Fed. Reg. 58761)), which modified the Harmonized Tariff Schedule of the United States (HTSUS) (by creating a new General Note 3(a)(v)) to provide duty-free treatment to articles which are the product of the West Bank, Gaza Strip or a qualifying industrial zone, provided certain requirements are met. Such treatment was effective for products of the West Bank, Gaza Strip or a qualifying industrial zone entered or withdrawn from warehouse for consumption on or after November 21, 1996.
Under General Note 3(a)(v), HTSUS, articles the products of the West Bank, Gaza Strip or a qualifying industrial zone which are imported directly to the U.S. from the West Bank, Gaza Strip, a qualifying industrial zone or Israel qualify for duty-free treatment, provided the sum of 1) the cost or value of materials produced in the West Bank, Gaza Strip, a qualifying industrial zone or Israel, plus 2) the direct costs of processing operations performed in the West Bank, Gaza Strip, a qualifying industrial zone or Israel, is not less than 35% of the appraised value of such articles when imported into the U.S. An article is considered to be a product of the West Bank, Gaza Strip or a qualifying industrial zone if it is either wholly the growth, product or manufacture of one of those areas or a new and different article of commerce that has been grown, produced or manufactured in one of those areas.
Under all of the scenarios noted above, the entities made up of the pants and belt (both textile and polyurethane) are not “products of the QIZ.” In all cases, the belts are products of China, and the mere repackaging of the belt with the pants does not substantially transform the belt into a product of the QIZ. Since all components of the entity do not meet the “products of” requirement, the set or composite is ineligible for consideration as a product of the QIZ. See Treasury Decision 91-7 (T.D. 91-7).
STATUS UNDER THE UNITED STATES-JORDAN FREE TRADE AREA IMPLEMENTATION ACT:
Title I of the United States-Jordan Free Trade Area Implementation Act of 2001, Pub. L. No. 107-43, 115 Stat. 243., referred to as the Jordan Free Trade Area Implementation Act, seeks to promote trade opportunities between the U.S. and the Hashemite Kingdom of Jordan. The JFTA provides preferential treatment for eligible apparel articles that: are the growth, product, or manufacture of Jordan; meet the 35 percent value content requirement; and are imported directly into the U.S. The rules for determining whether an article is entitled to preferential treatment under the JFTA are provided for in General Note (GN) 18, to the HTSUSA, as implemented by Presidential Proclamation 7512, dated December 7, 2001, 66 Fed. Reg. 64495, December 13, 2001. GN 18 provides, in part, as follows:
(a) The products of Jordan described in Annex 2.1 of the Agreement between the United States of America and the Hashemite Kingdom of Jordan on the Establishment of a Free Trade Area, entered into on October 24, 2000, are subject to duty as provided herein. Products of Jordan, as defined in subdivisions (b) through (d) of this note, that are imported into the customs territory of the United States and entered under a provision for which a rate of duty appears in the "Special" subcolumn followed by the "JO" in parentheses are eligible for the tariff treatment set forth in the "Special" subcolumn, in accordance with sections 101 and 102 of the United States-Jordan Free Trade Area Implementation Act (Public Law 107-43, 115 Stat. 243).
(b) For purposes of this note, subject to the provisions of subdivisions (d) and (e), goods imported into the customs territory of the United States are eligible for treatment as "products of Jordan" only if – (i) such goods are imported directly from Jordan into the customs territory of the United States, and (ii) they are – (A) wholly the growth, product or manufacture of Jordan, or (B) new or different articles of commerce that have been grown, produced or manufactured in Jordan and meet the requirements of subdivision (c) of this note.
(c) * * *(ii) For purposes of subdivision (b)(ii)(B), goods are eligible for the tariff treatment provided in this note if the sum of – (A) the cost or value of the materials produced in Jordan, plus (B) the direct costs of processing operations performed in Jordan, is not less than 35 percent of the appraised value of such article at the time it is entered. If the cost or value of materials produced in the customs territory of the United States is included with respect to an article to which this subdivision applies, an amount not to exceed 15 percent of the appraised value of the article at the time it is entered that is attributable to such United States cost or value may be applied toward determining the percentage referred to in this subdivision
(d) Textile and apparel articles. For purposes of this note, a textile or apparel article imported directly from Jordan into the Customs territory of the United States shall be eligible for the tariff treatment provided in subdivision (a) of this note only if –
(A) the article is wholly obtained or produced in Jordan;
(B) the article is a yarn, thread, twine, cordage, rope, cable or braiding, and
(i) the constituent staple fibers are spun in Jordan, or
(ii) the continuous filament is extruded in Jordan;
(C) the article is a fabric, including a fabric classified in chapter 59 of the tariff schedule, and the constituent fibers, filaments or yarns are woven, knitted, needled, tufted, felted, entangled or transformed by any other fabric-making process in Jordan; or
(D) the article is any other textile or apparel article that is wholly assembled in Jordan from its component pieces. Such textile and apparel articles not wholly obtained or produced in Jordan must comply with the requirements of this subdivision and of subdivision (c)(ii) of this note.
As noted above in the discussion of QIZ eligibility, under all of the scenarios the entities made up of the pants and belt (both textile and polyurethane) are not “products of the Jordan” under the U.S. - Jordan Free Trade Area Implementation Act. In all cases, the belts are products of China, and the mere repackaging of the belt with the pants does not substantially transform the belt into a product of Jordan under the act. Since all components of the entity do not meet the “products of” requirement, the set or composite is ineligible for consideration as a product of the Jordan under the act. See Treasury Decision 91-7 (T.D. 91-7).
HOLDING:
Based on the information provided, the pants and polyurethane belt produced under the scenarios indicated above are considered neither products of the QIZ, nor products under the U.S. - Jordan Free Trade Area Implementation Act.
Based on the information provided, the pants and textile belt produced under the scenarios indicated above are considered neither products of the QIZ, nor products under the U.S. - Jordan Free Trade Area Implementation Act.
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 C.F.R. §177.9(b)(1). This sections 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 C.F.R. §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 C.F.R. §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 Angela De Gaetano at 646-733-3052.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division