CLA 2-RR:NC:N3:351
Chris Guo
Texlink Import Companies, Inc.
207 Mineola Ave., Suite 555
Roslyn Heights, NY 11577
RE: Classification and country of origin determination for chenille yarn; 19 CFR 102.21(c)(4)
Dear Mr. Guo:
This is in reply to your letter dated June 22, 2007, requesting a classification and country of origin determination for chenille yarn which will be imported into the United States.
FACTS:
The subject 100% polyester chenille yarn consists of two spun yarns twisted together trapping chopped texturized filaments, creating the chenille effect. According to your letter, the filaments are extruded and texturized in the United States. The core yarns are spun in the United States. Both components, the core yarns and the effect filaments, are exported to Taiwan where the chenille yarn is manufactured.
ISSUE:
What are the classification and country of origin of the chenille yarn?
CLASSIFICATION:
The applicable subheading for the chenille yarn will be 5606.00.0090, Harmonized Tariff Schedule of the United States (HTSUS), which provides for chenille yarn. The rate of duty will be 8% ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.
COUNTRY OF ORIGIN - LAW AND ANALYSIS:
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at 19 U.S.C. 3592), enacted on December 8, 1994, provided rules of origin for textiles and apparel entered, or withdrawn from warehouse for consumption, on and after July 1, 1996.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 chenille yarn 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
5605 – 5606 If the good is of staple fibers, a change of those fibers to heading 5605 through 5606 from any other heading, except from heading 5106 through 5110, 5204 through 5207, 5306 through 5308, and 5508 through 5511, and provided that the change is a result of the spinning process.
Section 102.21(e) states that the change must be as a result of a spinning process. Accordingly, as the finished chenille yarn does not undergo a spinning process, 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 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 chenille yarn, the extrusion of the filaments and the spinning of the core yarns constitute the most important assembly processes. Both take place in the United States. Accordingly, the country of origin of the chenille yarn is the United States for purposes of country of origin marking.
However, Section 12.130(c), Customs Regulations, provides that any product of the United States that is returned after having been advanced in value or improved in condition abroad, or assembled abroad, shall be a foreign article. T.D. 90-17, issued February 23, 1990, stated that Customs will use Section 12.130 for quota, duty and marking purposes when making country of origin deter-minations for textile goods. On July 11, 2000, Customs published T.D. 00-44, stating that Customs will no longer apply 19 CFR 12.130(c) for purposes of country of origin marking. Therefore, the country of origin for marking the chenille yarn is the United States. Section 12.130(c) remains in effect for duty and quota purposes and the country of origin is Taiwan.
If a good is determined to be an article of U.S. origin for marking purposes, it is not subject to the country of origin marking requirements of 19 U.S.C. §1304. Whether an article may be marked with the phrase "Made in the USA" or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is made in the U.S.
Subheading 5606.00.0090 falls within textile category 201. With the exception of certain products of China, quota/visa requirements are no longer applicable for merchandise which is the product of World Trade Organization (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 on goods from China and related issues, we refer you to the web site of the Office of Textiles and Apparel of the Department of Commerce at www.otexa.ita.doc.gov.
HOLDING:
The country of origin of the chenille yarn for marking purposes is the United States. The country of origin for purposes of duty assessment and quota is Taiwan.
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 Mitchel Bayer at 646-733-3102.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division