CLA-2 RR:CR:TE 962214 jb
Allan H. Kamnitz, Esq.
Sharrets, Paley, Carter & Blauvelt, P.C.
Sixty Seven Broad Street
New York, NY 10004
RE: Country of origin determination for women's suit; 19 CFR
Section 102.21(c)(4); most important manufacturing operation
Dear Mr. Kamnitz:
This is in reply to a letter from your firm dated August 10,
1998, and subsequent submission, dated September 3, 1998, on
behalf of your client, Kasper A.S.L. Ltd, requesting a country of
origin determination for a women's suit, referenced style 40397,
made of 50 percent polyester and 50 percent acetate woven fabric.
The importations of this suit will be made in equal quantities
of jackets and skirts and will be offered and sold, at both the
wholesale and retail levels, as a suit.
FACTS:
The subject merchandise, referred to as style 40397,
consists of a suit-type jacket and skirt composed of identical
woven fabric produced from 50 percent polyester and 50 percent
acetate fibers. Both garments are tailored and fully lined with
a 100 percent acetate woven fabric. The jacket is constructed
from six panels sewn together lengthwise and features long
sleeves, darts, a notched collar, a full front opening secured by
a three button closure and besom pockets. The skirt features a
waistband, a rear center vent, a rear zipper and one button
closure and darts. This garment meets the requirements for a
suit as set out in Note 3(a) to Chapter 62, HTSUS.
You indicate in your letter that either the jacket or
matching skirt will be completely manufactured (as per the
operations listed below) in either Hong Kong or China.
Additionally, you state that in all instances the component
produced in China will be made first (prior to the production of
the second component in Hong Kong) and then sent to Hong Kong for
final pressing, final inspection and packing before export.
SKIRT
cut components
merrow all skirt panels
sew front and back darts
finish the centre back seam
press back vents
press waistband
join all lining seams
sew hanging loops
set zipper
join front and back panels
set lining to shell
set waistband
top stitch
blind stitch bottom hem
make buttonhole
sew button
JACKET
cut component pieces
sew front seam and open seam
sew tape onto front and back neck
make pocket flaps
make pocket and set flap onto pocket
make collar
sew main and size label onto neck facing
sew cuff onto sleeve
press sleeve hem
sew center back seam and press open
press bottom hem
sew sleeve
join side panels to front and back
join shoulder seams
join neck facing with front facings
set collar
set sleeves
set sleeve heads
sew shoulder heads
sew shoulder pads
join all lining seams and press
set lining to shell
turn jacket over and close sleeve lining seam
mark button hole position
bar tack button hole
mark button position
sew buttons
ISSUE:
What is the country of origin of the submitted merchandise?
LAW AND ANALYSIS:
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, in the Federal
Register, implementing Section 334 (60 FR 46188). Thus,
effective July 1, 1996, the country of origin of a textile or
apparel product shall be determined by sequential application of
the general rules set forth in paragraphs (c)(1) through (5) of
Section 102.21.
Paragraph (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." As 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.
Paragraph (c)(2) states that "Where 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".
Paragraph (e) states that "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:"
6201-6208 (1) If the good consists of two or more
component parts, a change to an
assembled good of heading 6201 through
6208 from unassembled components,
provided that the change is the result
of the good being wholly assembled in a
single country, territory, or insular
possession.
The subject suit is classified in heading 6204, HTSUS. As the
subject merchandise is not wholly assembled in a single country,
the terms of the tariff shift are not met.
Paragraph (c)(3) states that, "Where the country of origin
of a textile or apparel product
cannot be determined under paragraph (c)(1) or (2) of this
section:"
(i) If the good was knit to shape, the country of origin of
the good is the single country, territory, or insular
possession in which the good was knit; or
(ii) Except for goods of heading 5609, 5807, 5811,
6213, 6214, 6301 through 6306, and 6308, and subheadings
6209.20.5040, 6307.10, 6307.90, and 9404.90, if the good was not knit to shape and the good was wholly assembled in a
single country, territory, or insular possession, the
country of origin of the good is the country, territory, or
insular possession in which the good was wholly assembled.
As the subject merchandise is not knit to shape and assembly
operations occur in more than one country, paragraph (c)(3) is
inapplicable.
Paragraph (c)(4) states that, "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". In the case of the subject suit, the jacket
and skirt are wholly assembled in different countries.
As was stated in Headquarters Ruling Letter (HQ) 960073,
dated July 8, 1997, regarding the country of origin of suit
components manufactured in different countries:
...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;
* * *
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.
* * *
Similarly, in the case of the subject merchandise, although
the simple packing of the Chinese component in Hong Kong does
result in the classification of both components as a "suit" for
tariff purposes, it does not change the origin of that component.
As such, the most important manufacturing process for the subject
merchandise is the country in which each of the components for
the suit was wholly assembled. This is consistent with the
requirements set out in section 102.21(c)(2) which establishes
that the origin of merchandise classified in heading 6204, HTSUS,
is the single country in which the good is assembled. That is to
say, if the jacket is wholly assembled in China, for marking
purposes, the country of origin is China, and if the skirt is
wholly assembled in Hong Kong, for marking purposes, the country
of origin is Hong Kong. In the alternative, if the jacket is
wholly assembled in Hong Kong, for marking purposes, the country
of origin is Hong Kong, and if the skirt is wholly assembled in
China, for marking purposes, the country of origin is China.
HOLDING:
The subject merchandise is classified in subheading
6204.19.2000, HTSUSA, which provides for, women's or girls'
suits, ensembles, suit-type jackets, blazers, dresses, skirts,
divided skirts, trousers, bib and brace overalls, breeches and
shorts (other than swimwear): suits: of other textile materials:
of artificial fibers: other. The applicable general column one
rate of duty is 36.6/kg + 26.9% ad valorem. The textile quota
category is 644.
The subject merchandise will have two country of origins.
For purposes of marking each component should be clearly marked
with the appropriate country of origin.
For purposes of quota/visa, as the suit is classified in
subheading 6204.19.2000, HTSUSA, it requires a textile visa for
category 644. As the suit has two countries of origin (that is,
China for one component and Hong Kong for the other), both a
textile visa for category 644 from China and a textile visa in
category 644 from Hong Kong will be required for each suit to
enter the United States.
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). This section 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 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.
Sincerely,
John Durant, Director
Commercial Rulings Division