CLA-2-61:OT:RR:NC:N3:354
Ms. Elise Shibles
Sandler, Travis & Rosenberg PA
414 Jackson Street, Suite 200 San Francisco, CA 94111
RE: The status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA) of undergarments from Nicaragua
Dear Ms. Shibles:
In your letter dated October 4, 2024, on behalf of your client, Cupid Intimates, you requested a ruling on the eligibility of four styles of women's undergarments from Nicaragua for preferential tariff treatment under the DR-CAFTA. The samples will be retained.
Style 0367971 is a woman's thong panty constructed of 83% nylon, 17% spandex knit fabric. The undergarment features narrow elastic around the waist, thermoplastic polyurethane around the front of the leg openings, silicone tape along the inside of the rear of the waist and a gusset crotch lining. A narrow band (approximately 2.5 inches) of warp knit lace-like trim runs across the front of the waist.
Style 00578 is a woman's bikini panty constructed of 83% nylon, 17% spandex knit fabric with narrow elastic around the waist, thermoplastic polyurethane around the front of the leg openings, silicone tape along the inside of the rear of the leg openings and a gusset crotch lining. A narrow band (approximately 2.5 inches) of warp knit lace-like trim is inset at the top of each leg opening.
Style 0375631 is a woman's hi-leg style brief constructed of 83% nylon, 17% spandex knit fabric. The undergarment features narrow elastic around the waist and the front of the leg openings, silicone tape along the inside of the rear of the leg openings, and a gusset crotch lining. Warp knit lace-like trim is inset at the top of each leg opening.
Style 090670 is a woman's brief constructed of 90% nylon, 10% spandex knit fabric. The undergarment features narrow elastic around the back of the waist and the front of the leg openings, thermoplastic polyurethane around the front of the waist, silicone tape along the inside of the rear of the leg openings, and a gusset crotch lining. Warp knit lace-like trim is inset at the bottom of each leg opening.
As proper classification for a DR-CAFTA eligibility determination is required, we advise that the applicable subheading for all styles will be 6108.22.9020, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Women's or girls' slips, petticoats, briefs, panties, night dresses, pajamas, negligees, bathrobes, dressing gowns and similar articles, knitted or crocheted: Briefs and panties: Of man-made fibers: Women's. The general rate of duty will be 15.6%.
You had proposed classification under 6108.92.0015. However, all styles submitted meet the definition of either panties or briefs and thus remain classified in subheading 6108.22.
The manufacturing process is as follows:
The main body fabrics are manufactured in DR-CAFTA countries and classified in heading 6004.
Nylon yarn is formed in DR-CAFTA, Canada, Mexico or Israel and classified in heading 5402.
Spandex is formed in DR-CAFTA.
Elastic less than 30 cm wide is knitted or woven in a DR-CAFTA country.
Warp knit lace-like trim greater than 30 cm wide and classified in 6004 is knitted in Columbia.
Sewing thread is formed and finished in DR-CAFTA.
Silicone tape is formed outside DR-CAFTA.
Processing steps in Nicaragua are as follows:
Main body fabric is cut to shape.
Narrow elastic is cut to length.
Warp knit lace like trim less than 30 cm wide is slit to widths less than 30 cm wide (for style 0375631, the trim is also cut to shape after being slit to narrow width).
Assembly of all components with the sewing thread.
Finished undergarments are then packed and shipped directly to the United States (U.S).
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 non-originating 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 these styles contain non-originating materials, they must undergo the applicable change in tariff classification specified in GN 29(n) in order to meet the requirements of GN 29(b)(ii)(A). In addition, each must meet any applicable chapter rules found in GN 29(n), Chapter 61 as well as any applicable rules for textile and apparel goods set out in GN 29(d).
Chapter rule 2 states:
For purposes of determining whether a good of this chapter is originating, the rule applicable to that good shall only apply to the component that determines the tariff classification of the good and such component must satisfy the tariff change requirements set out in the rule for that good.
The component that determines the tariff classification of all styles is the main body fabric. Therefore, this is the only component that must satisfy the tariff shift rule set out in GN 29(n)/61.25. As described above, these fabrics are knit in a DR-CAFTA country of nylon yarn formed in a DR-CAFTA country or Canada or Mexico or Israel and spandex yarn formed in a DR-CAFTA country. Both yarns are classified in tariff heading 5402.
For goods classified in heading 6108, GN 29(n)/61.25 requires:
A change to headings 6105 through 6111 from any other chapter, except from headings 5111 through 5113, 5204 through 5212, 5310 through 5311, chapter 54, headings 5508 through 5516 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.
Non-originating nylon or spandex yarns would not meet the terms of the tariff shift.
GN 29 (d) Textile and apparel goods states, in relevant part:
(i)A textile or apparel good that is not an originating good under the terms of this note, because certain fibers or yarns used in the production of the component of the good that determines the tariff classification of the good do not undergo an applicable change in tariff classification set out in subdivision (n) of this note, shall be considered an originating good if--
(A) the total weight of all such fibers or yarns in that component is not more than ten percent of the total weight of that component; or
(B) such yarns are nylon filament yarns (other than elastomeric yarn) provided for in subheading 5402.11.30, 5402.11.60, 5402.19.30, 5402.19.60, 5402.31.30, 5402.31.60, 5402.32.30, 5402.32.60, 5402.45.10, 5402.45.90, 5402.51.00 or 5402.61.00 of the tariff schedule from a country that is a party to an agreement with the United States establishing a free trade area which entered into force before January 1, 1995.
Notwithstanding the preceding sentence, a textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of a party to the Agreement.
As Canada, Mexico and Israel became parties to agreements with the U.S. establishing a free trade area, and such agreements entered into force before 1995, nylon yarns sourced from those countries are considered to be originating in accordance with GN 29(d). The elastomeric yarns in the component of the good are wholly formed in a DR-CAFTA country.
As the main body fabrics are originating materials, GN 29(n)/61.25 is satisfied.
The additional GN 29(n) Chapter 61 rules that must be considered are 3 and 4.
Chapter rule 3 states, in relevant part:
Notwithstanding Chapter rule 2 to this chapter, a good of this chapter containing fabrics of subheading 5806.20 or heading 6002 shall be considered originating only if such fabrics are both formed from yarn and finished in the territory of one or more of the parties to the Agreement.
Since the warp knit lace-like trim originating in Colombia is classified in heading 6004 and not subheading 5806.20 or heading 6002, the undergarments are not subject to Chapter rule 3.
Chapter rule 4 states, in relevant part:
Notwithstanding Chapter rule 2 to this chapter, a good of this chapter containing sewing thread of heading 5204, 5401 or 5508 or yarn of heading 5402 used as sewing thread shall be considered originating only if such sewing thread or yarn is both formed and finished in the territory of one or more parties to the Agreement.
The sewing thread used is formed and finished in a DR-CAFTA country, therefore, Chapter rule 4 is satisfied.
Based on the facts provided, the goods described above qualify for DR-CAFTA preferential treatment because they will meet the requirements of HTSUS General Note 29(b)(ii)(A). The goods will therefore be entitled to a free rate of duty under the DR-CAFTA upon compliance with all applicable laws, regulations, and agreements.
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 at https://hts.usitc.gov/current.
The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP.
This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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, please contact National Import Specialist Karen Sikorski at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division