CLA-2-62:RR:NC:3:353 K87894
Ms. Margaret R. Polito
Neville Peterson LLP
17 State Street, 19th Floor
New York, NY 10004
RE: Classification of safety pants, status and marking under the North American Free Trade Agreement (NAFTA), Article 509; country of origin determination; 19 CFR 102.21(c)(2)
Dear Ms. Polito:
In your letter dated July 13, 2004 you requested a ruling, on behalf of Lohmann & Rauscher, Inc., on the classification, determination of country of origin, and status of safety pants under the NAFTA. A sample of the unfinished and finished item was provided and will be returned to you as requested.
The submitted samples, which will be imported into the United States, are two components (parts) for Model 665 Safety Pants constructed of yellow knit 100% polyester mesh fabric. Both pant parts feature two rows of 5-inch wide horizontal contrasting orange woven polyester fabric strips sewn onto what will become the leg; the orange strip has two one-inch wide reflective strips laminated to it. Both parts feature am approximately one-foot long elasticized hem and a slash pocket opening finished with binding tape. One component features a personal protective equipment (PPE) label, an OSHA requirement.
The manufacturing process is as follows:
United States
Knit fabric is formed from yarn spun in the U S
Woven fabrics are formed from yarn spun in the U S
Reflective tape is purchased in the U S that is U S originating.
The orange fabric is slit into 5-inch wide rolls
The reflective tape is slit into 1-inch wide rolls
The fabrics, slit fabric and slit reflective tape are exported to Mexico
Mexico
The yellow knit fabric will be cut into components
The slash pocket opening is created and binding is sewn around the pocket edge
The reflective tape is laminated to the orange fabric strips
Two strips of orange fabric with the reflective tape is sewn horizontally onto each component
A personal protective equipment (PPE) label, an OSHA requirement, is sewn onto one component
The components are hemmed with elasticized material
The two components are exported into the U S
United States
The components will be sewn to create the seams of the pant leg
Front and back seams are sewn
The top of the pant will be hemmed with elastic
A cord draw string will be installed
The pants will be inspected for quality control purposes
The applicable tariff provision for the parts of the Model 665 Safety Pants 6117.90.9070, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for “Other made up clothing accessories, knitted or crocheted; knitted or crocheted parts of garments or of clothing accessories: Parts: Other, Of trousers, breeches and shorts: Of man-made fibers.” The general rate of duty will be 14.6% ad valorem. The parts of the Model 665 Safety Pants 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 Textile Status Report for Absolute Quotas, which is available at our 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.
General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that
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
(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--
(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or
(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.
All of the components, with the exception of the elastic and PPE label are originating products. However, in accordance with General Note 12(f)(i), the "de minimus" rule will apply to these items. Based on the facts provided, the goods described above qualify for NAFTA preferential treatment, because they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials.
Regarding the parts for Model 665 Safety Pants, 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 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 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 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:"
HTSUS Tariff shift and/or other requirements
6215 - 6217 (1) 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 sewing of the orange and reflective strips to the components is a significant operation. At the time of importation, the unfinished Model 661 Safety Vest is wholly assembled in a single country, that is, Mexico, and as per the terms of the tariff shift requirement, country of origin is conferred in Mexico.
You have informed this office that the Model 665 Safety Pants will be assembled and finished in the United States, and request a determination as to marking of the finished item. A second determination using Section 102.21, Customs Regulations must be performed to determine the country of origin of the finished item, so it may be properly marked.
Regarding the finished Model 665 Safety Pants, 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 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 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 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:”
HTSUS Tariff shift and/or other requirements
6101 - 6117 (1) If the good is not knit to shape and consists of two or more component parts, except for goods of heading 6117.10 provided for in paragraph (e)(2) of this section, a change to an assembled good of heading 6101 through 6117 from unassembled components, provided that the change is the result of the good being wholly assembled in a single country, territory, or insular possession.
Section 102.21(e) states that the good must be wholly assembled in a single country. Accordingly, as the finished Mode 665 Safety Pants will be assembled in two countries, it does not meet the shift requirement, Section 102.21(c)(2) is inapplicable.
Section 102.21(c)(3) states that, "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 neither knit to shape, nor wholly assembled in a single country, 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 assembly process occurs when the components are sewn together to create the seams of the pant leg, the components are sewn together front and back to create the rise, and the waist is created. Accordingly, the country of origin of the finished Model 665 Safety Pants is the United States.
For Customs purposes, the finished Model 665 Safety Pants does not need to be marked. However, please note that separate Federal Trade Commission marking requirements exist regarding country of origin, fiber content, and other information that must appear on many textile items. You should contact the Federal Trade Commission, Division of Enforcement, 6th and Pennsylvania Avenue, N.W., Washington, D.C., 20580, for information on the applicability of these requirements to this item.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).
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 Kenneth Reidlinger at 646-733-3053.
Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs and Border Protection, 1300 Pennsylvania Ave. N.W., (Mint Annex), Washington, D.C. 20229.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division