CLA-2 CO:R:C:T 954947 CAB
6302.22.2020
Gail T. Cumins, Esq.
Sharretts, Paley, Carter & Blauvelt, P.C.
67 Broad Street
New York, NY 10004
RE: Country of origin for combined waterbed fitted/flat sheet
and pillowcases; Classification of a combined fitted/flat sheet
and pillowcases; set vs. separates; GRI 3; GRI 6
Dear Ms. Cumins:
This is in response to your inquiry of August 10, 1993,
requesting a country of origin determination as well as a tariff
classification ruling for bed linen, on behalf of The Morgan
Group, under the Harmonized Tariff Schedule of the United States
Annotated (HTSUSA). The bed linen will be imported from Thailand
or Sri Lanka.
FACTS:
The bed linen at issue consists of two pillowcases and one
combined fitted/flat sheet sewn together. The submitted samples
are constructed of woven 70 percent cotton/30 percent polyester
fabric. In your submission you state that the imported articles
will be constructed of either chief weight cotton (e.g., 60
percent cotton/40 percent polyester material) or chief weight
polyester fabric, (e.g., 55 percent polyester/45 percent cotton
material).
The combined fitted/flat sheet will be manufactured as
follows: Printed fabric will be manufactured in Country A and
then transported in rolls to either Thailand or Sri Lanka
(hereinafter Country B). In Country B, fabric will be cut to
length and width (four sides) and hemmed on all four sides. The
submitted samples have only been cut to width but you have
requested that we determine the country of origin as if they were
cut to both length and width. Pockets are then cut to size and
formed to fit all four corners of this panel. The pockets are
sewn to the sheet corners and the outer edges of the pockets are
hemmed. The bottom edge of the top panel is aligned with and
sewn to the bottom edge of the bottom panel. In Country B, the
pillowcases are created by cutting a panel, folding it over, and
sewing each side. The opening of the pillows is then hemmed.
ISSUES:
I. Whether the merchandise in question is classifiable as a set
or as a composite good?
II. What is the country of origin of the merchandise in
question?
LAW AND ANALYSIS:
TARIFF CLASSIFICATION
Classification of goods under the HTSUSA is governed by the
General Rules of Interpretation (GRI's). GRI 1 provides that
classification shall be determined according to the terms of the
headings and any relative section or chapter notes. Merchandise
that cannot be classified in accordance with GRI 1 is to be
classified in accordance with subsequent GRI's, taken in order.
GRI 3(a) in referring to "sets", states that when two or
more headings each refer to part only of the items in a set put
up for retail sale, those headings are to be regarded as equally
specific in relation to those goods. In this case, sheets and
pillowcases are packaged together and put up for retail sale.
Heading 6302, HTSUSA, is the provision for bed linen, table
linen, toilet linen and kitchen linen.
GRI 3(b) states that mixtures, composite goods, and goods
put in sets for retail sale, which cannot be classified by
reference to 3(a), shall be classified as if they consisted of
the material or component which gives them their essential
character, insofar as this criterion is applicable.
The Explanatory Notes to the Harmonized Commodity
Description and Coding System (EN), although not legally binding,
are the official interpretation of the tariff at the
international level. The EN to GRI 3(b), provides, in part:
(IX) For the purposes of this Rule, composite goods made
up of different components shall be taken to mean not only
those in which the components are attached to each other to
form a practically inseparable whole but also those with
separable components, provided these components are adapted
one to the other and are mutually complementary and that
together they form a whole which would not normally be
offered for sale in separate parts.
In this case, the combined fitted/flat sheet is constructed
by permanently sewing a flat sheet to a fitted sheet to form an
inseparable whole. The article is marketed and sold at the retail
level as a single combined sheet. As such, the combined
fitted/flat sheet is considered a composite good for tariff
classification purposes.
As a composite good, the fitted/flat sheet is classified as
a single article. Since the fitted sheet component and the flat
sheet component are classifiable in the same heading and the same
subheading, we do not need to determine which component
determines the classification of this composite article.
GRI 6 states that for legal purposes, classification of
goods in the subheading of a heading shall be determined
according to the terms of those subheadings and any related
subheading notes and, mutatis mutandis, to the above rules, on
the understanding that only subheadings at the same level are
comparable. GRI 6 mandates applying GRIs 1 through 5 when
classifying goods at the subheading level. Also, GRI 6 requires
the use of GRI 3 at the eight digit level in the HTSUSA, as it is
this level at which the classification of merchandise is finally
determined. Therefore, in order to be classifiable as a "set",
the articles must be classifiable in at least two different
subheadings.
In this instance, because the combined fitted/flat sheet and
the pillowcases are classifiable under the same subheading, it
can not be classifiable as a "set" in accordance with GRI 3.
This determination is in accordance with Headquarters Ruling
Letter 082043, dated April 5, 1989, when Customs determined that
a fitted sheet, a flat sheet, and two pillowcases which were
packaged and sold together at the retail level were classified
separately because the only difference in the subheading
classification was at the ten digit level.
COUNTRY OF ORIGIN
Country of origin determinations for textile products are
subject to Section 12.130, Customs Regulations (19 CFR 12.130).
Section 12.130 provides that a textile product that is processed
in more than one country or territory shall be a product of that
country or territory where it last underwent a substantial
transformation. A textile product will be considered to have
undergone a substantial transformation if it has been transformed
by means of substantial manufacturing or processing operations
into a new and different article of commerce.
Section 12.130(d), Customs Regulations, sets forth criteria
for determining whether a substantial transformation of a textile
product has taken place. This regulation states these criteria
are not exhaustive; one or any combination of criteria may be
determinative, and additional factors may be considered.
Section 12.130(d)(1), Customs Regulations, states that a new
and different article of commerce will usually result from a
manufacturing or processing operation if there is a change in:
(i) Commercial designation or identity
(ii) Fundamental character or
(iii) Commercial use
Section 12.130(d)(2), Customs Regulations, states that for
determining whether merchandise has been subjected to substantial
manufacturing or processing operations, the following will be
considered:
(i) The physical change in the material or article
(ii) The time involved in the manufacturing or processing
operations
(iii) The complexity of the manufacturing or processing
operations
(iv) The level or degree of skill and/or technology
required
(v) The value added to the article or material
Section 12.130(e)(1)(iv), Customs Regulations, states that a
textile article will usually be a product of a particular country
if the cutting of the fabric into parts and the assembly of those
parts into the completed article has occurred in that country.
However, 12.130(e)(2)(ii) states that a material will usually not
be considered to be a product of a particular foreign country by
virtue of merely having undergone cutting to length or width and
hemming or overlocking fabrics which are readily identifiable as
being intended for a particular commercial use.
When making a determination as to whether fabric used to
make sheets has been substantially transformed, the minimum
processing required is cutting the fabric to length and width
(four sides). After the fabric has been cut on four sides,
Customs assesses the additional processing and makes a
determination as to whether the additional processing coupled
with the cutting, amounts to a substantial manufacturing
operation.
In prior cases, Customs has evaluated the degree of skill,
value, and amount of time expended to manufacture sheets and made
substantial transformation conclusions accordingly. In HRL
952909, dated April 12, 1993, Customs concluded that fabric that
had been cut to length and width, coupled with the additional
processing required to attach piping to flat sheets, amounted to
a substantial manufacturing operation.
It is important to note that the submitted sample has not
been cut to length and width, but you maintain that the imported
merchandise will be cut to length and width. Customs must make a
determination as to whether a combined fitted and flat sheet that
will be cut to length and width and sewn together in Country B
amounts to a substantial transformation. The manufacturing
process involved in constructing the fitted sheet at issue is
different from the standard fitted sheet, which includes cutting
each corner, sewing, and fitting elastic onto the corners. In
this case, the fitted sheet is produced by cutting the corners
into rounded edges and attaching four triangular pockets to each
corner. It is Customs belief that if the combined fitted/flat
sheet is cut to length and width in addition to the the finishing
and joining operations, then the processing in Country B is
sufficiently complex to amount to the last substantial
transformation. Therefore, the country of origin of the combined
fitted/flat sheet is Country B.
In determining the country of origin for pillowcases,
Customs refers to Belcrest Linens v. United States, 741 F.2d
1368, (Fed. Cir. 1984). The court held that a bolt of woven
fabric that was manufactured, stenciled with embroidery, and
imprinted with lines of demarcation in China prior to being sent
to Hong Kong where the fabric was cut, sewn into pillowcases, and
packaged, was subject to its last substantial transformation in
Hong Kong. Thus, when applying the court's rationale to the
subject pillowcases, it appears that the fabric which will be cut
and sewn into pillowcases in Country B, will undergo the last
substantial transformation in Country B.
HOLDING:
The country of origin of the combined fitted/flat sheet and
the pillowcases is Country B.
Based on the foregoing, if the chief weight of the combined
fitted/flat sheet is cotton, it is classifiable under subheading
6302.21.2040, HTSUSA, which provides for cotton printed sheets.
The applicable rate of duty is 7.6 percent ad valorem and the
textile restraint category is 361. If the chief weight of the
combined fitted/flat sheet is polyester, then it is classifiable
under subheading 6302.22.2020, HTSUSA, which provides for printed
sheets of man-made fibers. The applicable rate of duty is 13
percent ad valorem and the textile restraint category is 666. If
the chief weight of the pillowcases are cotton, then they are
classifiable under subheading 6302.21.2020, HTSUSA, which
provides for cotton pillowcases. The rate of duty is 7.6 percent
ad valorem and the textile restraint category is 360. If the
chief weight of the pillowcases is polyester, then they are
classifiable under subheading 6302.22.2010, HTSUSA, which
provides for pillowcases of man-made material. The rate of duty
is 13 percent ad valorem and the textile restraint category 666.
The designated textile and apparel category may be
subdivided into parts. If so, visa and quota requirements
applicable to the subject merchandise may be affected. Since
part categories are the result of international bilateral
agreements which are subject to frequent renegotiations and
changes, to obtain the most current information available, we
suggest that you check, close to the time of shipment, the Status
Report on Current Import Quotas (Restraint Levels), an internal
issuance of the U.S. Customs Service, which is available for
inspection at your local Customs office.
Due to the changeable nature of the statistical annotation
(the ninth and tenth digits of the classification) and the
restraint (quota/visa) categories applicable to textile
merchandise, you should contact your local Customs office prior
to importing the merchandise to determine the current status of
any import restraints or requirements.
This ruling is issued pursuant to the provisions of Part 177
Customs Regulations (19 CFR Part 177). The holding in this
ruling only applies to the specific factual situation presented
and the merchandise identified in the ruling request. If the
information furnished is not accurate or complete, or there is a
change in the factual situation, this ruling will no longer be
valid. In such an event, a new ruling request should be
submitted.
Your attention is directed to the Notice of Proposed Rule
Making which the Customs Service published in the Federal
Register on Monday, January 3, 1994 (59 FR 141). That notice
proposed objective rules for determining the country of origin of
goods imported into the United States. Although, the notice
stated that the rules were intended to codify our present origin
rules, there are a few areas where the proposed rules are not
consistent with Customs present position. The transaction
described in this ruling is one of those instances. Accordingly,
you should be aware that if the proposed rules are adopted as
published, this ruling will no longer be valid and a different
result may apply.
Sincerely,
John Durant, Director