CLA-2: RR:TC:TE 960073 PR
Jack Gumpert Wasserman, Esq.
Wasserman, Schneider & Babb
90 John Street
New York, New York 10038
RE: Country of Origin of men's suits, suit jackets, and suit
pants; 19 CFR 102.21(c)(4);
19 CFR 102.17; 19 CFR 12.130(c)(2)
Dear Mr. Wasserman:
This ruling is in response to your submission of January 21,
1997, concerning the country of origin of men's suits and suit
jackets since the suit jackets may be imported separately.
FACTS:
Submitted for Customs determination of origin are three sets
of assembly or manufacturing processes to produce the suit
jacket. The processing to produce the suit pants involves one
set of assembly or manufacturing processes and remains the same
in each fact situation. We have been advised that the different
sets of assembly or manufacturing processes presented are not
hypothetical. The inquirer believes that the country of origin
under each of the following fact situations presented for both
the suits and the suit jackets when imported separately is
Country A, which is a United States insular possession.
SUIT Jacket
FACT SITUATION NO. 1
Jacket SHELL Jacket LINING
Country A
Cutting Cutting
Fusible interlining--
chest piece (hymo)
left & right fronts
upper & lower sleeve pieces
collar
flaps
Assemble-- Assemble--
fronts to sides fronts to sides
sleeves (two seams) sleeves (two
seams)
back panels back panels
Country B
Sew small parts
Assemble-- Assemble--
small parts to components backs to
front/side assemblies
backs to front/side assemblies sleeves to
body
sleeves to body entire lining to
outer shell
shoulder seams
FACT SITUATION NO. 2
Jacket SHELL Jacket LINING
Country A
Cutting Cutting
Fusible interlining--
chest piece (hymo)
left & right fronts
upper & lower sleeve pieces
collar
flaps
Assemble-- Assemble--
fronts to sides fronts to sides
back panels back panels
backs to front/side assemblies backs to
front/side assemblies
Country B
Sew small parts
Assemble-- Assemble--
small parts to sleeves (two
seams)
components sleeves to body
sleeves (two seams) entire lining to
outer shell
shoulder seams
sleeves to body
FACT SITUATION NO. 3
Jacket SHELL Jacket LINING
Country A
Cutting Cutting
Fusible interlining--
chest piece (hymo)
left & right fronts
upper & lower sleeve pieces
collar
flaps
Assemble-- Assemble--
sleeves (two seams) sleeves (two
seams)
back panels back panels
front panels to sides front
panels to sides
backs to front/side assemblies backs to
front/side assemblies
Country B
Sew small parts
Assemble-- Assemble--
small parts to major components sleeves to
body
shoulder seams shoulder seams
sleeves to body entire lining to
outer shell
SUIT PANTS
FACT SITUATIONS NO's. 1, 2, AND 3
Country A
All components cut.
Fusible interlinings assembled to left and right fly pieces.
Left and right waistband sections assembled (but not joined)
nonwoven fabric edge guides sewn to shell fabric (Note
that
submission states that fusible interlinings have
been applied
to shell fabrics, but samples have no fusible
interlinings).
sew "banrol" to above assembly.
sew inside lining to above assembly.
Sew shell fabric facings to hip pockets (NOTE that samples
show no
evidence of this being done).
Create back welt pockets by cutting and sewing. (NOTE that
samples
only contain partially completed rear pockets; the
pocket fabrics have not been sewn into the shape
of bags).
Country B
Complete assembly of the four major panels by sewing.
Waistband finished and assembled to major panels.
Belt loops.
Fly lining and zipper attached.
After the assembly and manufacturing operations are
performed in Country B, the pants and suit jacket are returned to
Country A where (1) button holes are made; (2) buttons attached;
(3) the pants are matched up with the suit coat; (4) labels and
trim are sewn; and (5) the garments are cleaned, steamed, put on
hangers, boxed and shipped as completed suits.
ISSUE:
The inquirer seeks a determination of the country of origin
of the garments imported as suits and of the individual suit
jacket when imported separately.
LAW AND ANALYSIS:
General Note 3(a)(iv), Harmonized Tariff Schedule of the
United States (HTSUS) (formerly General Headnote 3(a), Tariff
Schedules of the United States), provides for the duty-free
treatment of goods imported from a United States insular
possession if they: (1) are the growth or "product of" the
possession; (2) meet certain value-content requirements; and (3) come directly to the customs territory of
the United States from the possession. To comply with the
requirements of General Note 3(a)(iv), an imported article first
must qualify as a "product of" a United States insular
possession. See Yuri-Fashions v. United States, 632 F. Supp. 41,
46 (CIT 1986); T.D. 90-17 dated February 23, 1990. However, in
this instance, the inquirer has requested a ruling on the country
of origin of the suit and the suit jacket, not on the duty status
of the imported merchandise. Accordingly, the applicability of
General Note 3(a)(iv) is not an issue addressed by this ruling.
The rules of origin generally applicable to textile and
apparel products are provided for by statute in section 334,
Uruguay Round Agreements Act (19 U.S.C. 3592). As directed by
section 334, Customs promulgated implementing regulations,
section 102.21, Customs Regulations (19 CFR section 102.21),
which became effective July 1, 1997. In accordance with section
102.21, the country of origin of imported textile and apparel
goods is determined by a hierarchy of rules set forth in
paragraphs (c)(1) through (c)(5) of that section.
In situations where woven garments are assembled in more
than one country, paragraphs one through three of section 102.21
are not applicable. Accordingly, the country of origin of the
instant garments is determined by the application of either
paragraph (c)(4) or paragraph (c)(5). Section 102.21(c)(4)
provides:
(4) Where the country of origin of a textile or
apparel product cannot be determined under paragraph
(c)(1), (2) or (3) of this section, the country of
origin of the good is the single country, territory, or
insular possession in which the most important assembly
or manufacturing process occurred.
Section 102.21(c)(5) provides:
(5) Where the country of origin of a textile or
apparel product cannot be determined under paragraph
(c)(1), (2), (3) or (4) of this section, the country of
origin of the good is the last country, territory, or
insular possession in which an important assembly or
manufacturing process occurred.
SUIT PANTS
In determining the country of origin of the suit pants
imported separately from the suit jacket, applying section
102.21(c)(4), the most important processing occurs in Country B,
where the subject pants take shape; where they become a
recognizable article of commerce; and where all the major
components are joined.
SUIT JACKETS
In determining the country of origin of the suit jacket
pursuant to section 102.21(c)(4), the three fact situations
presented produce mixed results. In the first fact situation, in
Customs view, the assembly operations performed in County B
clearly outweigh the importance of the assembly operations
performed in Country A. Accordingly, applying the rules
contained in 19 U.S.C. 3592 and section 102.21, the country of
origin of the suit jacket in the first fact situation is country
B.
The processing and assembly steps listed in the second fact
situation present a more difficult question of origin. It
appears that the manufacturing and processing done in Country A
and Country B are virtually equal. Six major panels are joined
in Country A to form the body of the outer shell, (except for the
shoulder seams) and a similar six panels are joined in Country A
to create the body lining (except for the shoulder seams). In
Country B, the two halves of each outer shell sleeve cylinder and
the two halves of each sleeve lining cylinder are assembled, the
linings are attached to the sleeves, the sleeves are then
attached to the body of the garment, the body lining is attached
to the outer shell, and the shoulder seams are closed. While
Customs does not normally place a great deal of importance to the
assembly of linings in determining the country of origin of a
garment, it is believed that in tailored men's wool suit jackets,
the assembly of the tailored linings merits additional
consideration. In addition, Customs has consulted with experts
in the construction of garments and has been informed that the
assembly of sleeves, the attachment of those sleeves, and the
closing of shoulder seams are extremely important to the
production of a tailored man's wool suit jacket. Accordingly,
the country of origin of the suit jacket when imported separately
under the facts presented in the second fact situation is, by
application of section 102.21(c)(5), Country B, the country in
which the last important assembly occurs.
The third fact situation differs from the second fact
situation. As noted above, the importance of the assembly
operations performed in Countries A and B on the suit jacket in
the second fact situation is virtually equal. By adding more
assembly operations in Country A in the third fact situation (the
forming of the sleeve cylinders for both the outer shell and the
lining), and removing those assembly operations from Country B,
it appears that in the third set of facts, the most important
assembly is being performed in Country A. Accordingly, applying
section 102.21(c)(4), the origin of the suit jacket when imported
separately under the facts presented in the third fact situation
is Country A, the country in which the most important assembly
occurs. However, since Country A is an insular possession of the
United States, the applicability of Section 12.130(c)(2), Customs
Regulations (19 CFR 12.130(c)(2)), must be considered. That
section provides:
(2) Applicability to U.S. insular possession
products processed outside the insular possession.
Unless otherwise required by law, the rules of origin
applicable to products of the U.S. shall also apply to
products of insular possessions of the U.S.
Accordingly, notwithstanding paragraph (b) of this
section, for purposes of section 204, Agricultural Act
of 1956, as amended, products of insular possessions of
the U.S., if imported into the U.S. after having been
advanced in value, improved in condition, or assembled,
outside the insular possessions shall not be treated as
products of those insular possessions.
Section 12.130(c)(2) was promulgated pursuant to authority
delegated by the President in Executive Orders 11651, dated March
5, 1972, and 12475, dated May 9, 1984, to the Committee for the
Implementation of Textile Agreements (CITA) as the policy making
agency, and to the Customs Service, as the administrating agency.
The President's authority in this area is contained in section
204, Agricultural Act of 1956, as amended (7 U.S.C. 1854).
Section 204 authorizes the President to issue regulations
governing the entry, or withdrawal from warehouse of textiles or
textile products subject to international agreements in order to
effectuate those agreements, even if the goods "are the products
of countries not parties to the agreement."
After its return to Country A from Country B the suit jacket
described in the third fact situation did not undergo any
manufacturing or processing which would cause Country A to be the
country of origin. Therefore, the clear language of section
12.130(c)(2) precludes, for quota, visa, and other textile
restraint purposes, the suit jacket from being treated as a
product of an insular possession of the United States.
Accordingly, the suit jacket will be subject to any restraints or
restrictions applicable to products of Country B.
SUIT JACKET AND SUIT PANTS IMPORTED TOGETHER AS A SUIT
In the first and second fact situations, both the jacket and
the pants are products of Country B. Accordingly, it follows
that the country of origin of the suit under both of those fact
situations is Country B.
In the third fact situation, where the suit jacket and suit
pants have different countries of origin, we look to applicable
Customs regulations and rulings to determine how the suit should
be treated. Section 102.17, Customs Regulations (19 CFR
102.17), which is incorporated by reference in section 102.21,
and which specifically refers to section 102.21, provides, in
pertinent part, as follows:
102.17 Non-qualifying operations.
A foreign material shall not be considered to
have undergone the applicable change in tariff
classification set out in 102.20 or 102.21, or
satisfy the other applicable requirements of that
Section by reason of:
* * *
(c) Simple packing, repacking or retail
packaging without more than minor processing;
The terms "material" and "minor processing" are defined in
sections 102.1(l) and (m), Customs Regulations (19 CFR 102.1(l)
and (m)), respectively.
(l) Material. "Material'' means a good that is
incorporated into another good as a result of
production with respect to that other good, and
includes parts, ingredients, subassemblies, and
components.
(m) Minor processing. ``Minor processing'' means the
following:
* * *
(4) Trimming, filing or cutting off small amounts
of excess materials;
(5) Unloading, reloading or any other operation
necessary to maintain the good in good condition;
(6) Putting up in measured doses, packing,
repacking, packaging, repackaging;
(7) Testing, marking, sorting, or grading;
(8) Ornamental or finishing operations incidental
to textile good production designed to enhance the
marketing appeal or the ease of care of the
product, such as dyeing and printing, embroidery
and appliques, pleating, hemstitching, stone or
acid washing, permanent pressing, or the
attachment of accessories notions, findings and
trimmings; or
(9) Repairs and alterations, washing, laundering, or
sterilizing.
In accordance with the clear wording of the above quoted
Customs regulations, the components of the suits (i.e., the
jackets and pants) returned to Country A after processing in
Country B are subjected to "simple packing, repacking or retail packaging without more than minor processing." As a
result, under section 102.21, the jackets and pants remain
products of Countries A and B respectively.
The foregoing result is not a novel consequence of the
circumstances of this case. It appears that Treasury Decision
(TD) 91-7, which is an interpretive rule concerning, among other
things, the applicability of special tariff treatment programs
(e.g. the General System of Preferences (GSP) and the Caribbean
Basin Initiative (CBI)) to collections of articles classified
under a single tariff provision such as sets, mixtures, and
composite goods, would have dictated the same origin result for
the imported suits. In addition to recognizing that there may be
multiple countries of origin for those type articles, TD 91-7
specifically states that where an entire imported entity (set or
composite good) is not the "product of" the beneficiary country,
neither the entity nor any part thereof is entitled to
preferential rates of duty.
As a general rule, a collection classifiable in one
subheading pursuant to the GRI's will receive CBI
treatment only if all of the items or components in the
collection are considered "products of" the beneficiary
country. The same is now true under the GSP with
respect to articles entered on or after August 20,
1990. (emphasis added)
TD 91-7 mentions only CBI, GSP, Automotive Products Trade
Act, Agreement on Trade in Civil Aircraft, U.S.-Canada Free Trade
Agreement, and the U.S.-Israel Free Trade Area. However, we see
no valid distinction between these preference programs and
General Note 3(a)(iv). In the same manner that those programs
require a good be the "growth, product or manufacture" of a
beneficiary country, General Note 3(a)(iv) requires that the
imported good be the "growth, product or manufacture" of the U.S.
insular possession.
Since General Note 3(a)(iv) requires a product to be the
"growth, product or manufacture" of a U.S. insular possession,
and the pants component of the suit is not such a product, the
"suit" is not a product of an insular possession.
In a recent submission to this office, the inquirer stated
that a suit is a single entity which is provided for eo nomine in
the Harmonized Tariff Schedule of the United States (HTSUS), and,
therefore, it may not be considered to be a set, mixture, or
composite good.
The Harmonized Commodity Description and Coding System,
Explanatory Notes, which is the official interpretation of the
HTSUSA at the international level (for the 4 digit headings and
the 6 digit subheadings), states at page 4:
[C]omposite 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.
The suits in question clearly conform to that definition.
In addition, the definition of the term "suit" contained in both
chapters 61 and 62, HTSUS, specifically states that the term
"means a set of garments . . ." (emphasis added) Accordingly,
without trying to engage in semantics, it appears to Customs that
by the wording of the HTSUS, for classification purposes a suit
can be characterized as either a set or a composite good.
The inquirer's submission in this area appears to be
directed towards the classification of the suit. In this regard,
Customs has no intention of ruling that a suit consisting of
components with different countries of origin would be classified
under a provision, or provisions, other than the eo nomine
provision applicable to that suit. Such a position would clearly
be contrary to the requirements of the HTSUS. Section 102.17,
C.R., is applicable only with respect to determining the origin
of imported goods. It is not applicable or even considered when
determining the proper classification of a suit.
HOLDING:
Pursuant to section 102.21, the country of origin of the
suit pants is Country B.
Pursuant to section 102.21, the country of origin of the
suit jacket, when imported separately from the suit pants is
Country B under the first two fact situations and Country A under
the third fact situation. In the third fact situation, pursuant
to section 12.130(c)(2), the suit jacket is a product of Country
B for quota, visa, and other textile restraint purposes.
Pursuant to section 102.21, under the first two fact
situations, the country of origin of the suit is Country B.
Under the third fact situation: (1) since, pursuant to section
102.21, the jacket and pants, when imported as a suit, remain
products of Countries A and B respectively, the "suit" is not the
"growth, product or manufacture" of an insular possession as
required by General Note 3(a)(iv); and (2) pursuant to section
12.130(c)(2), the country of origin of the suit, for quota, visa,
and textile restraint purposes is Country B. The holdings set forth above apply only to the specific
factual situation and merchandise identified in the ruling
request and as described in this ruling. This position is
clearly set forth in section 177.9(b)(1), Customs Regulations (19
CFR 177.9(b)(1)), which states that a ruling letter is issued on
the assumption that all of the information furnished in the
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 section
177.9(b)(1), the ruling will be subject to modification or
revocation. Any change in the facts 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 section 177.2, Customs
Regulations (19 CFR 177.2).
In the event it is determined that the imported goods are
not being manufactured exactly as described in this ruling, the
ruling will not be applicable to those goods. You should also be
aware that the assembly and manufacturing processes described in
the foregoing ruling may be subject to periodic verification by
the Customs Service.
Sincerely,
John Durant, Director
Tariff Classification Appeals
Division