CLA-2-56:RR:NC:TA:351 C80857

Mr. Chris Guo
FiberOption Co.
150-66 Jewel Ave., Fl 2
Flushing, NY 11367

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a chenille yarn from Mexico; Article 509

Dear Mr. Guo:

In your letter dated October 16, 1997, you requested a ruling on the tariff status of chenille yarns from Mexico under the NAFTA.

The one sample furnished, which was not identified as to style or quality number, consists of a chenille yarn. It is composed of twisted strands of textile yarn which grip short ends of textile yarns or fibers thereby creating a caterpillar like effect. In your correspondence, you describe three chenille yarns of different fiber content and ask if they would quality for NAFTA eligibility.

Specifically, you wish to import chenille yarn from Mexico which is produced from raw materials (yarns) sourced as follows:

Acrylic - 1/40 Nm, 1/30Nm from Taiwan or Indonesia. Cotton - 20/1 Ne, 30/1 Ne from India or Pakistan. Rayon _ 20/1 Ne, 30/1 Ne from Indonesia or Taiwan. These are spun yarns of headings 5205 (cotton), 5509 (acrylic) and 5511 (rayon).

The applicable tariff provision for the chenille yarn will be 5606.00.0090, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for ... chenille yarn. The general rate of duty will be 10.1 percent ad valorem.

To qualify for preferential treatment under the NAFTA, the production of the goods will have to undergo a tariff classification shift required by General Note 12(t)/56, HTSUSA.

Specifically, said paragraph in HTSUSA states that in order to qualify for favorable NAFTA treatment you must have "a change to heading 5601 through 5609 from any other chapter, except from heading 5106 through 5113, 5204 through 5212, 5307 through 5308 or 5310 through 5311, or chapters 54 through 55." All your raw materials have failed to meet this important tariff shift requirement.

With respect to your inquiry concerning Tariff Preference Levels as suggested by someone at Headquarters, and how this may affect the tariff status of this merchandise, Section XI, U.S. Additional notes, note 5(b) makes allowances for certain yarns, however, chenille yarns of subheading 5606.00.0090 are not included therein.

These chenille yarns do not qualify for preferential treatment under NAFTA or for consideration under the Tariff Preference Levels.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).

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 George Barth at 212-466-5884.

Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1301 Constitution Ave., NW, Franklin Court, Washington, DC 20229.

Sincerely,

Robert B. Swierupski
Director,
National Commodity
Specialist Division