CLA-2 RR:CR:SM 558958 KKV

Ms. Jenny Gillis
Babykins Products (1992) Ltd.
8171 Seafair Dr.
Richmond, British Columbia
V7C 1X3
CANADA

RE: Country of origin of adult waterproof pull-on pants; 19 CFR 102.21; textile or apparel article; produced exclusively of domestic materials; tariff shift; eligibility under the Nairobi Protocol; specially designed or adapted for the handicapped; subheading 9817. 00.96; incontinence

Dear Ms. Gillis:

This is in response to your letter dated September 25, 1996 (received by our office on January 3, 1997), which requests a binding ruling regarding the country of origin and eligibility of certain adult waterproof pull-on pants for duty-free treatment under subheading 9817.00.96, Harmonized Tariff Schedule of the United States (HTSUS), upon importation from Canada. A sample of each of the five styles was submitted with your request.

FACTS:

The article under consideration is referred to as "adult pull-on pants" which is allegedly designed to effectively manage serious, chronic incontinence problems of adults. Samples of five different styles have been submitted, all of which consist of four or five pattern pieces which are stated to be "cut, make and trim in Canada":

Style No. Composition and Tariff Classification

#10200 Plastic coated fabric of 100% woven polyester fabric from Holland, classifiable under subheading 6210.50.5055, HTSUS, is cut into four component pattern pieces and assembled together with Canadian-origin lycra binding into a completed article.

#10300 Plastic coated fabric of 100% polyester fabric from Taiwan, classifiable under subheading 6210.50.5055, HTSUS, is cut into four component pattern pieces and assembled together with Canadian-origin lycra binding into a completed article.

#10600 Plastic coated fabric of 100% woven nylon fabric from Taiwan, classifiable under subheading 6210.50.5055, HTSUS, is cut into five component pattern pieces and assembled together with Canadian-origin lycra binding into a completed article.

#10300V 100% vinyl fabric from Canada, classifiable under subheading 3926.20.9050, HTSUS, is cut into four component pattern pieces and assembled together with Canadian-origin lycra binding into a completed article.

#11000 100% natural rubber fabric from the U.S., classifiable under subheading 4015.90.0050, HTSUS, is cut into four component pattern pieces and assembled together with Canadian-origin lycra binding into a completed article.

It is stated that the products under consideration, referred to as "adult pull-on pants," are made for the incontinent market and are designed to go over adult cloth diapers. Different fabrics are utilized in the construction of the garments to provide a variety of levels of protection. Upon importation into Canada from various countries, the imported fabric (or domestic fabric, in the case of garments represented by style #10300V) is cut into component pieces which are sewn and assembled together with Canadian-origin lycra binding into finished garments. Essential to the design of all five styles is the need for a main one-piece pattern with no side or crotch seams for moisture to transfer or wick to outer clothing. Also essential is the elastic binding at the waist and leg openings, considerably tighter than normal trim, which prevents moisture from seeping out at these openings.

ISSUES:

I. What is the country of origin of the adult-pull-on pants?

II. Whether adult pull-on pants are "specially designed or adapted" for the handicapped within the meaning of the Nairobi Protocol, Annex E, to the Florence Agreement, as codified in the Education, Scientific, and Cultural Materials Act of 1982, and therefore eligible for duty-free treatment under subheading 9817.00.96, HTSUS.

LAW AND ANALYSIS

I. Country of origin

On December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act (codified at 19 U.S.C. 3592) provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. On September 5, 1995, Customs published section 102.21, Customs Regulations (19 CFR 102.21), in the Federal Register, implementing Section 334 (60 FR 46188). Thus, effective July 1, 1996, the country of origin for a textile or apparel product is determined by a sequential application of the origin rules set forth in paragraphs (c)(1) through (5) of section 102.21. As a general rule, under the new textile origin rules, where a textile or apparel article is assembled in one country from components cut to shape in another country, the country of assembly will be the origin of the article. Cutting fabric to shape no longer confers origin.

Thus, the initial question to be addressed is whether the adult pull-on pants at issue qualify as a "textile and apparel good" for purposes of 19 CFR 102.21. It has been determined that Style #10200, #10300 and #10600 are made up of fabric from heading 5903, HTSUS, and are classifiable under subheading 6210.50.5055, HTSUS, which provides for "Garments, made up of fabrics of heading 5602, 5603, 5903, 5906 or 5907: other women's or girls' garments: of man-made fibers: other: other." Style # 10300V is classifiable under subheading 3926.20.98050, HTSUS, which provides for "Other articles of plastics and articles of other materials of headings 3901 to 3914: articles of apparel and clothing accessories (including gloves): other: other." Style # 11000 is classifiable under subheading 4015.90.0050, HTSUS, which provides for "Articles of apparel and clothing accessories (including gloves), for all purposes, of vulcanized rubber other than hard rubber: other: other." Section 102.21(b)(5,), Customs Regulations (19 CFR 102.21(b)(5)), provides that a "textile or apparel product" is any good classified in Chapters 50 through 63, HTSUS, and any good classifiable under certain enumerated HTSUS headings or subheadings, which include neither heading 3926 nor heading 4015, HTSUS. Thus, under the facts presented, the pull-on pants represented by Style # 10200, #10300 and #10600, which are classifiable under subheading 6210.50.5055, HTSUS, qualify as a "textile and apparel good" for purposes of the 19 CFR 102.21 rules of origin. The garments represented by the remaining two styles, #10300V and #11000 do not qualify as a "textile and apparel good" and the origin of these articles is determined under the NAFTA Marking Rules.

A. Style # 10200, #10300 and #10600

Section 102.21(c)(1), Customs Regulations (19 CFR 102.21(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." Inasmuch as fabric from Holland and Taiwan is processed into garments in Canada, 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.

Section 102.21(c)(2), Customs Regulations (19 CFR 102.21(c)(2)), provides:

[w]here 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 foreign material 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.

Section 102.21(e) 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:"

6210.50 (3) If the good consists of two or more component parts, a change to an assembled good of heading 6210 through 6212 from unassembled components, provided that the change is a result of the good being wholly assembled in a single country, territory, or insular possession. Garments represented by style # 10200, #10300, and #10600 are classified in subheading 6210.50.5055, HTSUS. Under the facts provided, the adult pull-on pants are stated to be "cut, make and trim" in Canada. Because the finished garments are assembled in Canada from four (style #10200 and #10300) or five (style #10600) fabric components which have been cut in Canada from foreign fabric, the applicable tariff shift rule is met and the country of origin for garments represented by style #10200, #10300 and #10600 is Canada, pursuant to Section 102.21(c)(2).

B. Style #10300V and #11000

Section 134.1(j), Customs Regulations (19 CFR 134.1(j)), provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g), Customs Regulations (19 CFR 134.1(g)), defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules, set forth at 19 CFR Part 102.

Section 102.11, Customs Regulations (19 CFR 102.11), sets forth the required hierarchy for determining whether a good is a good of a NAFTA country for marking purposes. This section states that the country of origin of a good is the country in which:

(1) The good is wholly obtained or produced; (2 The good is produced exclusively from domestic materials; or

(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied.

Section 102.1(e), Customs Regulations (19 CFR 102.1(e)) defines "foreign material" as "a material whose country of origin as determined under these rules is not the same country or origin as the country in which the good is produced."

Based on the information provided with regard to style #10300V, vinyl material and lycra of Canadian origin is cut into four pattern pieces and assembled into a finished garment in Canada. Because the article is produced exclusively from domestic materials in Canada, the country of origin of garments represented by style #10300V is Canada, pursuant to 10 CFR 102.11(a)(2).

With regard to style #11000, we are informed that rubber fabric of U.S. origin is exported to Canada, where it is assembled together with lycra of Canadian origin into a finished adult pull-on pant. Because the article is assembled in Canada with U.S. fabric, the finished article is neither wholly obtained or produced, nor produced exclusively from domestic materials. Accordingly, neither 19 CFR 102.11(a)(1) or 102.11(a)(2) may be used to determine the origin of garments represented by style #11000.

Pursuant to 19 CFR 102.11(a)(3), the country of origin of a good is the country in which each foreign material incorporated in that good undergoes an applicable change in tariff classification as set forth in 19 CFR 102.20, and satisfies any other applicable requirements of that section. In the case before us, because the finished waterproof adult pull-on pants represented by style #11000 are classified under 4015.90.0050, HTSUS, the change in tariff classification must be made in accordance with section 102.20(g), Section VII: Chapters 39 through 40, heading 4015, HTSUS, which requires "[a] change to heading 4015 from any other heading."

In the case before us, U.S.-origin rubber fabric, initially classified under subheading 4008.21.0000, HTSUS, is subsequently classified under subheading 4015.90.0050, HTSUS, as a result of assembly operations in Canada. Accordingly, the article undergoes the requisite tariff shift and the country of origin for garments represented by style #11000 is Canada, pursuant to 19 CFR 102.11(a)(3).

II. Eligibility of the merchandise for duty-free treatment under subheading 8917.00.96, HTSUS

The Nairobi Protocol, Annex E, to the Florence Agreement, as codified by the United States Congress as the Education, Scientific, and Cultural Materials Act of 1982 (Pub.L. 97-446, 96 Stat. 2346 (1982)) established the duty-free treatment for certain articles for the handicapped. Presidential Proclamation 5978 and Section 1121 of the Omnibus Trade and Competitiveness Act of 1988, provided for the implementation of the Nairobi Protocol into subheadings 9817.00.92, 9817.00.94 and 9817.00.96 of the Harmonized Tariff Schedule of the United States (HTSUS). These tariff provisions specifically state that "[a]rticles specially designed or adapted for the use or benefit of the blind or other physically or mentally handicapped persons" are eligible for duty-free treatment.

U.S. Note 4(a), subchapter XVII, Chapter 98, HTSUS, states that "the term blind or other physically or mentally handicapped persons' includes any person suffering from a permanent or chronic physical or mental impairment which substantially limits one or more major life activities, such as caring for one's self, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning, or working." However, this note establishes certain limitations on the classification of products in these subheadings, stating:

(B) Subheadings 9817.00.92, 9817.00.94 and 9817.00.96 do not cover --

(i) articles for acute or transient disability;

ii) spectacles, dentures, and cosmetic articles for individuals not substantially disabled;

(iii) therapeutic and diagnostic articles; or

(iv) medicine or drugs.

It has been previously established that a person suffering from chronic incontinence is "physically handicapped" within the meaning of U.S. Note 4(a), subchapter XVII, Chapter 98 HTSUS (See Headquarters Ruling Letter (HRL) 085092, dated May 10, 1990, and HRL 085094, dated May 10, 1990). Therefore, the remaining issue for resolution is whether the articles are "specially designed or adapted" for the use or benefit of the handicapped within the meaning of the Nairobi Protocol.

In Treasury Decision 92-77 (26 Cust. Bull. 1, (August 26, 1992)), Customs addressed the implementation of the duty-free provisions of the Nairobi Protocol, and discussed the eligibility requirements for duty-free treatment. With regard to whether an article has been "specially designed or adapted" for the handicapped, Customs stated the following:

A primary factor to be considered concerns the physical properties of the article itself, i.e., whether the article is easily distinguishable, by properties of the design and the corresponding use specific to this unique design from articles useful to non-handicapped individuals. If an article is solely dedicated use by the handicapped, e.g. pacemakers or hearing aids, then this is conclusive evidence that the articles are "specially designed or adapted" for the handicapped for purposes of the Nairobi Protocol.

Customs has previously discussed the physical properties of similar articles designed for use by individuals suffering from chronic incontinence. In HRL 557529, dated March 8, 1994, Customs considered the design features of certain adult diapers. Upon finding that they were durable, well constructed and designed for repeated use over a long period of time, Customs held that the articles were "specially designed or adapted" for the handicapped within the meaning of the Nairobi Protocol and the articles were granted duty-free status under subheading 9817.00.96, HTSUS. Likewise, HRL 558958, dated October 6, 1995, held that identical diapers sized for youth were also eligible for duty-free treatment under subheading 9817.00.96, HTSUS ( See also HRL 085691, dated April 18, 1990, HRL 085092, dated May 10, 1990, HRL 088279 dated March 5, 1991; and HRL 08876, dated March 5, 1991 for other rulings discussing the use of some sort of vinyl to prevent leakage in conjunction with incontinence).

The physical properties of the adult pull-on pants under consideration are similar to that of adult diapers. The use of waterproof vinyl or rubber fabric, tighter than normal waist and leg binding and the absence of side or crotch seams are design features from which great benefit may be derived from those individuals suffering from chronic incontinence, but are features of marginal utility to a non-handicapped person.

The utility of the article to a non-handicapped person is a relevant consideration to another factor set forth by T.D. 92-77, supra: the "probability of general public use." While some form of plastic pants are normally worn by both handicapped and non-handicapped infants with diapers, the articles under consideration are too large to be worn by infants. As the non-handicapped infant ages and matures, the need for the protection that the plastic pants provide diminishes, rendering the probability of general public use of the waterproof pull-on pants unlikely.

We note that, in light of the design features of the pull-on pants which render it suitable for individuals with chronic or permanent incontinence, the fact that they could also be used for postpartum or post-operative therapy does not disqualify them from receiving duty-free status under subheading 9817.00.96, HTSUS.

HOLDING:

On the basis of the information and samples submitted, the country of origin of garments represented by style #10200, #10300, and #10600 is Canada, pursuant to Section 102.21(c)(2), Customs Regulations (19 CFR 102.21(c)(2)). The country of origin of garments represented by style #10300V and #11000 is Canada, pursuant to 19 CFR 102.11(a)(3).

On the basis of the information and samples submitted, the adult waterproof pull-on pants are considered to be articles "specially designed or adapted for the handicapped," within the meaning of the Nairobi Protocol, Annex E, to the Florence Agreement, as codified in the Education, Scientific, and Cultural Materials Act of 1982, and thus, are eligible for duty-free treatment under subheading 9817.00.96, HTSUS.

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), which states that a ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.

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 this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction

Sincerely,

John Durant
Director
Commercial Rulings Division