CLA-2 OT:RR:CTF:TCM W968299 KSH
William R. Rucker, Esq.
Drinker Biddle Gardner & Carton
191 N. Wacker Drive
Suite 3700
Chicago, Illinois 60606-1698
RE: Modification of NY M81369; woven fabric coated with polyurethane plastics. Dear Mr. Rucker:
This letter is in response to your request of July 7, 2006 and supplemental letter of August 3, 2006, on behalf of your client Synthetic Resources, Inc., for reconsideration of New York Ruling Letter (NY) M81369, dated March 23, 2006, as it pertains to the classification of two woven fabrics coated on one side with polyurethane plastics under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). NY M81369 addressed the classification of four fabrics. However, the instant request for reconsideration only involves two of the styles.
In NY M81369, we determined that the coated fabrics were classified in heading 5407, HTSUSA. They were classified in subheading 5407.52.2060, HTSUS, which provides for “Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of heading 5404: Other woven fabrics, containing 85 percent or more by weight of textured polyester filaments: Dyed: Other, Weighing more than 170 g/m².” We have reviewed that ruling and found it to be in error.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI, notice of the proposed action was published on September 12, 2007, in Volume 41, Number 38, of the CUSTOMS BULLETIN. CBP received no comments in response to the notice.
FACTS:
The two sample fabrics at issue are identified as style 6004530AU and style 10502220AU. They are woven and coated on one side with a clear polyurethane coating. The fabrics are used to create backpacks, luggage and similar articles. Style 6004530AU is a textured polyester oxford woven fabric made from 600 denier polyester thread. The weight of the polyester is 7.0 oz/yd² and comprises 79.55% of the weight of the fabric. The clear polyurethane coating weighs 1.8 oz./yd.² and comprises 20.45% of the weight of the fabric. Style 10502220AU is a nylon basket weave woven fabric made from 1050 denier nylon thread. The weight of the nylon is 12.4 oz./yd² and comprises 86.11% of the weight of the fabric. The clear polyurethane coating weighs 2.0 oz/yd² and comprises 13.89% of the total weight of the fabric.
ISSUE:
Whether the fabrics are classified in heading 5407, HTSUSA, as woven fabrics of synthetic filament yarn, or in heading 5903, HTSUSA, as textile fabrics impregnated, coated, covered or laminated with plastics.
LAW AND ANALYSIS:
Classification of goods under the HTSUSA is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI may then be applied.
The Harmonized Commodity Description and Coding System Explanatory Notes (EN), constitute the official interpretation of the Harmonized Tariff Schedule at the international level. While neither legally binding nor dispositive, the EN provide a commentary on the scope of each heading of the HTSUSA and are generally indicative of the proper interpretation of the headings. It is Customs and Border Protection’s (CBP) practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUSA. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
Heading 5407, HTSUSA, provides for the classification of "Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of heading 5404." Materials of heading 5404, HTSUS, include, in part, "strip and the like (for example, artificial straw) of synthetic textile materials of an apparent width not exceeding 5 mm."
Heading 5903, HTSUSA, provides for “[t]extile fabrics impregnated, coated, covered or laminated with plastics, other than those of heading 5902.” Note 2 to Chapter 59 provides, in pertinent part: Heading 5903 applies to:
(a) Textile fabrics, impregnated, coated, covered or laminated with plastics, whatever the weight per square meter and whatever the nature of the plastic material (compact or cellular), other than:
(1) Fabrics in which the impregnation, coating or covering cannot be seen with the naked eye…; for the purpose of this provision, no account should be taken of any resulting change of color.
The EN to heading 5903, HTSUSA, provides in relevant part:
This heading covers textile fabrics which have been impregnated, coated, covered or laminated with plastics (e.g., poly(vinyl chloride)).
Such products are classified here whatever their weight per m² and whatever the nature of the plastic component (compact or cellular), provided:
(1) That, in the case of impregnated, coated or covered fabrics, the impregnation, coating or covering can be seen with the naked eye otherwise than by a resulting change in colour.
Textile fabrics in which the impregnation, coating or covering cannot be seen with the naked eye or can be seen only by reason of a resulting change in colour usually fall in Chapters 50 to 55, 58 or 60. Examples of such fabrics are those impregnated with substances designed solely to render them crease-proof, moth-proof, unshrinkable or waterproof (e.g., waterproof gabardines and poplins). Textile fabrics partially coated or partially covered with plastics and bearing designs resulting from these treatments are also classified in Chapters 50 to 55, 58 or 60.
It is undisputed that the subject fabric has been coated with a clear polyurethane layer. At issue is whether this coating is visible to the naked eye. If the coating is not visible to the naked eye, the fabrics will be excluded from heading 5903, HTSUSA, and will be classified in heading 5407, HTSUSA.
A fabric is considered a fabric of heading 5903, HTSUSA, if its impregnation, coating or covering of plastics is visible to the naked eye as required by Note 2(a)(1) to Chapter 59, HTSUSA, with no account taken of any resulting change in color. It is CBP’s longstanding view that the wording of Note 2(a)(1), "visible to the naked eye," is a clear expression by the drafters of the Harmonized System that a significant, if not substantial, amount of material must be added to a fabric for it to be considered impregnated, coated or covered. The plastic material added to the fabric must be visibly distinguishable from the fabric without the use of magnification. CBP believes this criterion is satisfied when the application of plastics material visibly affects the surface character of the fabric (Headquarters Ruling (HQ) 967884, dated October 26, 2005); the plastic is visible in the interstices of the fabric (See HQ 961172, dated August 6, 1998); the thread or weave is blurred or obscured, (HQ 089772, September 11, 1991); or the surface of the fabric is leveled or smoothed and the coating itself creates a distinct visible pattern (Id.). These factors are not exclusive and none is determinative. See HQ W968300, dated February 8, 2007.
No account should be taken of any resulting change in only shine, reflectivity, dullness or other property which causes the viewer to see the effect rather than presence of plastic material. See generally HQ 967884, dated October 26, 2005, on the classification of certain pants with polyurethane coating; HQ 082219, dated November 21, 1988, on the classification of three fabrics; HQ 085245, dated August 31, 1989, on the classification of a men's nylon coat made of certain coated fabrics; HQ 087941, dated December 12, 1990, on the classification of certain fusible interlining fabrics from Japan; and HQ 084165, dated June 26, 1989, on the classification of certain fusible interlining fabrics. Applying the "visible to the naked eye" test on the fabrics of style 6004530AU and style 10502220AU, using normally corrected vision in a well-lighted room, we find that the clear polyurethane coating has filled the gaps in the interstices. Accordingly, the coating is visible to the naked eye and the fabrics are classified in heading 5903, HTSUSA.
Our decision is in accord with HQ 950103, dated November 7, 1991, NY 885395, dated June 21, 1993 and NY A85467, dated August 13, 1998, in which substantially similar merchandise was classified in heading 5903, HTSUSA.
HOLDING:
By application of GRI 1, the fabrics are classified in heading 5903, HTSUSA. They are provided for in subheading 5903.20.2500, HTSUSA, which provides for “Textile fabrics impregnated, coated, covered or laminated with plastics, other than those of heading 5902: With polyurethane: Of man-made fibers: Other: Other.” The general column one rate of duty is 7.5% ad valorem.
Merchandise classified in subheading 5903.20.2500, HTSUSA, falls within textile category 229. Quota/visa requirements are no longer applicable for merchandise which is the product of World Trade Organization (WTO) member countries. The textile category number above applies to merchandise produced in non-WTO member-countries. Quota and visa requirements are the result of international agreements that are subject to frequent negotiations 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 http://otexa.ita.doc.gov.
EFFECT ON OTHER RULINGS:
NY M81369 is hereby modified.
In accordance with 19 U.S.C. 1625 (c), this ruling will become effective 60 days after its publication in the CUSTOMS BULLETIN.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division