CLA-2 RR:CR:SM 561006 RSD
Sergio Galindo, Esq.
Galindo Customhouse Broker
Spur 239 La Frontera Bldg, suite 1
P.O. Box 420924
Del Rio, Texas 78842
RE: Applicability of subheading 9802.00.90, HTSUS, to women's
woven vest; findings; trimmings; zipper; NAFTA treatment
Dear Mr. Galindo:
This is in reference to your letter of June 10, 1997,
requesting a ruling on behalf of Rhodes Collections of Garland,
Texas, regarding the eligibility for North America Free Trade
Agreement (NAFTA) treatment of ladies woven vests assembled in
Mexico. A sample of the vest was submitted with your request.
We regret the delay in responding to your inquiry.
FACTS:
The submitted merchandise is a sleeveless vest, the shell of
which is made from woven fabric consisting of 78% acetate, 16%
polyester and 6% rayon yarn. The vest has oversized arm openings
and a full front closure secured by a zipper. There is a patch
of lining fabric located at the inside rear of the neckline which
is 100% acetate.
We are advised that all of the components used in the
assembly of the vest are U.S. origin with the exception of the
zipper which is made in China. You state that the yarn is spun in
the U.S. from fibers which also are of U.S. origin. The fabric
is then woven in the U.S. and all fabric components are cut to
shape in the U.S. The vest is then assembled in Mexico. You
state that the cost of the zipper is $.52 while the cost of the
finished vest is $10.14.
ISSUE:
Whether the zipper may be considered a "finding or trimming"
for purposes of subheading 9802.00.90, HTSUS.
LAW AND ANALYSIS:
Appendix 2.4 of Annex 300-B of the NAFTA, provides that:
[o]n January 1, 1994, the U.S. shall eliminate customs
duties on textile and apparel goods that are assembled in Mexico
from fabrics wholly formed and cut in the United States and
exported from and re-imported into the United States under:
(a) U.S. tariff item 9802.00.80.10; or
(b) Chapter 61, 62, or 63 if, after such assembly,
those goods that would have qualified for treatment
under 9802.00.80.10 have been subject to bleaching,
garment dyeing, stone-washing, acid-washing or perma-pressing.
Thereafter, the U.S. shall not adopt or maintain any customs
duty on textile and apparel goods of Mexico that satisfy the
requirements of subparagraph (a) or (b) or the requirements of
any successor provision to U.S. tariff item 9802.00.80.10.
Consequently, subheading 9802.00.90, HTSUS, was created to
provide for the duty-free entry of:
Textile and apparel goods, assembled in Mexico in which
all fabric components were wholly formed and cut in the
United States, provided that such fabric components, in
whole or in part, (a) were exported in condition ready
for assembly without further fabrication, (b) have not
lost their physical identity in such articles by change
in form, shape or otherwise, and (c) have not been
advanced in value or improved in condition abroad
except by being assembled and except by operations
incidental to the assembly process; provided that goods
classifiable in chapters 61, 62, or 63 may have been
subject to bleaching, garment dyeing, stone-washing,
acid- washing or perma-pressing after assembly as
provided for herein.
In view of the fact that the enactment of subheading
9802.00.90, HTSUS, specifically was intended to extend duty-free
and quota-free status to all goods assembled in Mexico which
previously were eligible for entry under the Special Regime
Program administered under U.S. tariff item 9802.00.8010, HTSUS,
it is Customs view that all of the policy directives implementing
this program should be considered applicable in the
administration of subheading 9802.00.90, HTSUS. One such policy
under the Special Regime Program included the allowance of
"findings, trimmings, and certain elastic strips of foreign
origin" to be incorporated into the assembled good "provided they
do not exceed 25 percent of the cost of the components of the
assembled product." See 54 FR 50425 (December 6, 1989).
Examples of findings and trimmings are sewing thread, hooks and
eyes, snaps, buttons, "bow buds," lace trim, zippers, including
zipper tapes, and labels. See 53 FR 15726 (May 3, 1988).
"Findings" are also defined as "a term referring to supplementary
fabrics employed in making a garment such as zipper tapes,
lining, pocketing, and waistband." See I. Wingate, Fairchild's
Dictionary of Textiles (1970).
In Headquarters Ruling Letter (HRL) 958103 dated August 25,
1995, February 14, 1996, we determined that zippers were
"findings or trimmings".
In regard to the sample vest at issue, the National
Commodity Specialist reports that the vest would be classified in
subheading 6211.43.0076, HTSUS. Appendix 1.1, Annex 300-B of the
NAFTA, specifies that articles classified in Chapter 62 of the
HTSUS, are considered "textile and apparel goods" under
subheading 9802.00.90, HTSUS, and thus the vest would qualify as
a textile for purposes of duty-free treatment under subheading
9802.00.90 HTSUS. We also note that the information presented
indicates that all of the fabric components used to make the vest
are fully formed and cut in the United States with the exception
of the zipper. In addition, it appears that the fabric
components of the vest are not improved in condition or advanced
in value in Mexico excepted for the purpose of being assembled
into the finished vest. Because the value of the zipper would
not exceed 25% of the total cost of the finished vest's
components, the zipper would be an acceptable finding or
trimming, and hence its presence in the garment would not
disqualify it from eligibility for duty-free treatment under
subheading 9802.00.90, HTSUS. Accordingly, because the
information submitted indicates that all of the elements for
eligibility for a claim under subheading 9802.00.90 are
satisfied, the vest would qualify for duty-free treatment under
subheading 9802.00.90, HTSUS.
Although your request specifically concerned whether the
vest would qualify as a NAFTA originating good, inasmuch as the
vest would be eligible for duty-free treatment under 98020.00.90,
we believe that it is unnecessary to also address whether the
vest would qualify as a NAFTA originating good.
HOLDING:
Based upon the information provided, it is our opinion that
the zippers are considered "findings or trimmings." Therefore,
vests made with foreign zippers may qualify for duty-free
treatment under subheading 9802.00.90, HTSUS, assuming that the
zippers do not exceed 25 percent of the total cost of all of the
vest's components, and all of the fabric components are
U.S.-formed (i.e., the fabric is woven or milled in the U.S.) and
cut in the U.S., and the vests are assembled in Mexico.
A copy of this ruling letter should be attached to the entry
documents find 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