CLA-2-62:OT:RR:NC:N3:356
Ms. Jena Hooks
Haggar Clothing Company
11511 Luna Road
Dallas, Texas 75234
RE: The tariff classification and status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA), of a men’s woven shirt from Nicaragua.
Dear Ms. Hooks:
In your letter dated January 13, 2015, you requested a ruling on the status of woven shirts under DR-CAFTA. As requested, the sample is being returned to you.
Style HW00094 is a men’s shirt constructed from 60% cotton, 40% polyester woven fabric. Style HW00094 has a self-fabric buttoned –down point collar; a left over right, full front opening with seven button closures; a patch pocket on the left chest; a rear yoke; long, vented sleeves with button closures on the vents and on the cuffs; and a curved, hemmed bottom.
The shirt is packaged in an individual polybag which identifies its contents, including the neck and sleeve sizes. The packaging also includes chipboards, pins, plastic sheeting to help the collar remain shaped (collar form), tissue paper and jet clips. You also included illustrations of the individual polybags and hangtags that will be packaged with the shirt at the time of import.
In your letter, you submit that the shirt is a dress shirt, classifiable under subheading 6205.20.2016 of the Harmonized Tariff Schedule of the United States (HTSUS) which provides for men’s or boys’ shirts: of cotton: other: dress shirts: with two or more colors in the warp and/or the filling: men’s. The duty rate is 19.7% ad valorem. We disagree with your proposed classification. The fabric, for the garment, does not contain two or more colors in the warp and/or in the filling.
Consequently, the applicable subheading for Style HW00094 will be 6205.20.2026, HTSUS, which provides for men’s or boys’ shirts, of cotton: other: dress: other: men’s. The duty rate is 19.7% ad valorem.
You also indicate in your letter that the shirts will be cut and sewn in Nicaragua from fabric formed outside the territories of the DR-CAFTA parties. The garments will be shipped directly to the United States from Nicaragua. You assert that the shirts are eligible for preferential duty treatment under the DR-CAFTA as originating goods pursuant to General Note 29(n), Chapter 62, Rule 30A and are exempt from the requirement that sewing thread of headings 5204, 5401 or 5508, used to assemble the goods be formed and finished in the territory of one or more of the DR-CAFTA parties pursuant to GN 29(n), Chapter 62, Chapter Rule 4.
The tariff shift rule for GN 29(n), Chapter 62.30A states,
A change to dress shirts for men, with two or more colors in the warp and/or the filling, each with collar and sleeve size stated in inches, without dual collar sizing, the foregoing individually packaged with chipboards, pins, jett (sic) clips, individual polybags and hang tags ready for retail sale, of tariff item 6205.20.20 from any other chapter, provided that the good is cut or knit to shape, or both, and sewn or otherwise assembled in the territory of one or more of the parties to the Agreement.
We disagree with your proposed determination. The garment is not constructed from fabric containing two or more colors in the warp and/or in the filling. As a result, GN 29(n), 62.30A does not apply.
General Note 29, HTSUS, sets forth the criteria for determining whether a good is originating under the DR-CAFTA. General Note 29(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that
For the purposes of this note, subject to the provisions of subdivisions (c), (d), (m) and (n) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good under the terms of this note if—
(i)the good is a good wholly obtained or produced entirely in the territory of one or more of the parties to the Agreement;
(ii) the good was produced entirely in the territory of one or more of the parties to the Agreement, and—
(A) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (n) of this note; or
(B) the good otherwise satisfies any applicable regional value content or other requirements specified in subdivision (n) of this note;
and the good satisfies all other applicable requirements of this note; or
(iii) the good was produced entirely in the territory of one or more of the parties to the Agreement exclusively from originating materials.
As the good contains non-originating materials, it would have to undergo an applicable change in tariff classification in order to meet the requirements of GN 29(b)(ii)(A).
For goods classified under subheading 6205.20, General Note 29/61.30B requires:
A change to any other good of subheading 6205.20 from any other chapter, except from headings 5111 through 5113, 5204 through 5212, 5310 through 5311, chapter 54, headings 5508 through 5516, 5801 through 5802 or 6001 through 6006, provided that the good is cut or knit to shape, or both, and sewn or otherwise assembled in the territory of one or more of the parties to the Agreement.
The merchandise does not qualify for preferential treatment under DR-CAFTA because (a) it will not be wholly obtained or produced entirely in the territory of one or more DR-CAFTA countries; (b) one or more of the non-originating materials used in the production of the goods will not undergo the change in tariff classification required by General Note 29(n)/62.30B, HTSUS; and (c) it will not be produced entirely in the territory of one or more of the DR-CAFTA parties exclusively from originating materials. You have suggested that the garment may be subject to a reduced rate of duty classified under 9822.05.01.
General Note 29(m)(viii)(B) states: An apparel good of chapter 61 or 62 of the tariff schedule and imported under heading 9822.05.01 of the tariff schedule shall be considered originating if it is cut or knit to shape, or both, and sewn or otherwise assembled in the territory of one or more of the parties to the Agreement, and if the fabric of the outer shell, exclusive of collars and cuffs where applicable, is wholly of— (1) one or more fabrics listed in U.S. note 20 to subchapter XXII of chapter 98; or (2) one or more fabrics formed in the territory of one or more of the parties to the Agreement from one or more of the yarns listed in U.S. note 20 to such subchapter XXII; or (3) any combination of the fabrics referred to in subdivision (B)(1), the fabrics referred to in subdivision (B)(2) or one or more fabrics originating under this note. The originating fabrics referred to in subdivision (B)(3) may contain up to 10 percent by weight of fibers or yarns that do not undergo an applicable change in tariff classification set out in subdivision (n) of this note. Any elastomeric yarn contained in a fabric referred to in subdivision (B)(1), (B)(2) or (B)(3) must be formed in the territory of one or more of the parties to the Agreement. Chapter 98, subchapter XXII of the HTSUS U.S. Note 20(a) and (b) to that chapter states in pertinent part, that: Heading 9822.05.01 shall apply to textile or apparel goods of chapters 50 through 63 and subheading 9404.90 that contain any of the fabrics, yarns or fibers set forth herein, are described in general note 29 to the tariff schedule and otherwise meet the requirements of such general note 29.
Within Chapter 98, U.S. Note 20(b) is the following:
The United States Trade Representative may modify the enumeration of designated fabrics, yarns and fibers set forth in subdivision (a) of this note to reflect CITA determinations described in subdivision (a) of this note, in a notice published in the Federal Register.
Within the Office of Textiles and Apparel’s short supply list for CAFTA-DR, Annex 3.25, is the following designated yarn:
Fabrics classified in subheading 5210.21 or 5210.31, not of square construction, containing more than 70 warp ends and filling picks per square centimeter, of average yarn number exceeding 70 metric.
Based on the facts provided, the garment described may qualify for DR-CAFTA preferential treatment because garment meets the requirements of HTSUS General Note 29(m)(viii)(B)(1).
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/.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
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 Rosemarie Hayward via e-mail at [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division