CLA-2-63:OT:RR:NC:N3:351

Herbert J. Lynch
Sullivan & Lynch, P.C.
Inner Tech Park
56 Roland St., Suite 303
Boston, MA 02129-1223

RE: The tariff classification, country of origin, and status under the North American Free Trade Agreement (NAFTA), of a wire wrap; 19 CFR 102.21(c)(2); Article 509

Dear Mr. Lynch:

In your letter dated Jan. 20, 2009, on behalf of Velcro USA Inc., of Manchester, New Hampshire, you requested a ruling on the status of a textile fabric wire wrap from under the NAFTA. You also requested a classification ruling, a country of origin determination, and the item’s eligibility under subheading 9802.00.90, Harmonized Tariff Schedule of the United States (HTSUS). The sample which you submitted is being retained by this office.

You submitted a sample of an item known as a wire wrap. It is designed to wrap around electrical wires running between various electrical appliances such as computer components and an electrical outlet to create a neat and safe working environment. It is composed of a piece of knit pile fabric measuring approximately 8” x 17½”. Along the longer side, a strip of woven narrow fabric, 3/8” wide has been sewn. The assembly of the two fabrics by sewing makes this item “made up” according to the terms of Note 7 to Section XI, HTSUS. When rolled around the electrical wires, the two fabrics attach using, as you say in your letter, “the unique fastening technique derived from the hook and loop properties engineered by Velcro USA into narrow woven fabric.”

Both fabrics are made using nylon yarns of either chapter 54 or 55, HTSUS. You state that the knit pile fabric is predominantly composed of a foreign yarn not produced in a NAFTA country. The fabrics are both produced in Velcro’s plants in New Hampshire and shipped as roll goods to a subsidiary in Mexico where the fabrics are cut to length; the narrow fabric is then stitched to the knit pile fabric to create the finished wire wrap.

CLASSSIFICATION:

The applicable tariff provision for the textile fabric wire wrap will be 6307.90.9889, Harmonized Tariff Schedule of the United States (HTSUS), which provides for other made up textile articles, other. The rate of duty will be 7% ad valorem.

In your letter, you rely on New York Ruling NY 871212, dated Feb. 20, 1992, to suggest classification in subheading 6307.90.9480. Please note that that subheading has been replaced by subheading 6307.90.9889. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.

NAFTA:

General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that

For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as “goods originating in the territory of a NAFTA party” only if--

(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or

(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--

(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or

(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or

(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or

(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for “parts” and used in the production of such goods does not undergo a change in tariff classification because--

(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or

(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts, provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.

GN12(t)/63 states, at (4.)

A change to headings 6304 through 6310 from any other chapter, except from headings . . . 5204 through 5212, . . . chapters 54 through 55, or headings . . . 6001 through 6002, provided that the good is both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the NAFTA.

The merchandise does not qualify for preferential treatment under the NAFTA because the knit pile fabric contains foreign yarns of chapters 54 through 55.

ELIGIBILITY UNDER SUBHEADING 9802.00.90, HTSUS:

Subheading 9802.00.90, HTSUS, provides, in pertinent part, for:

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.

For tariff purposes, cutting the fabrics to length is considered an operation that is incidental to the assembly process. The assembly in Mexico of the narrow woven fabric and the knit pile fabric produced in the United States will entitle the wire wrap to be entered under subheading 9802.00.90, HTSUS, provided that all the documentary requirements are met. The information substantiating 9802.00.9000, HTSUS, must be submitted at the time of entry.

COUNTRY OF ORIGIN - 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, “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, “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 of the foreign materials 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) in pertinent part states, “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:”

HTSUS Tariff shift and/or other requirements

The country of origin of a good classifiable under 6307.90 is the country, territory or insular possession in which the fabric comprising the good was formed by a fabric-making process.

As the fabric that comprises this good was formed in a single country, that is, the United States, as per the terms of the tariff shift or other requirement, country of origin is conferred in the United States.

If a good is determined to be an article of U.S. origin, it is not subject to the country of origin marking requirements of 19 U.S.C. §1304. Whether an article may be marked with the phrase “Made in the USA” or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is made in the U.S.

HOLDINGS:

The country of origin of the wire wrap is the United States. The item does not qualify for preferential treatment under the NAFTA. The item will be entitled to be entered under subheading 9802.00.90, HTSUS, provided that all the documentary requirements are met at the time of entry.

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 Mitchel Bayer at (646) 733-3102.

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 and Border Protection, Office of International Trade, Regulations and Rulings Mint Annex, 799 9th Street N.W., Washington, D.C. 20001-4501.

Sincerely,

Robert B. Swierupski
Director
National Commodity Specialist Division