CLA-2-62:OT:RR:NC:N3:356
Mr. Patrick J. Caulfield
Grunfeld, Desiderio, Lebowitz, Silverman and Klestadt LLP
599 Lexington Avenue, Fl. 36
New York, NY 10022-7648
RE: The tariff classification and status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA) of men’s suit-type jackets from Guatemala
Dear Mr. Caulfield:
In your letter dated November 17, 2016, on behalf of your client, The Men’s Wearhouse, you requested a ruling on the classification and status under the DR-CAFTA of a men’s suit-type jacket from Guatemala. Your sample will be returned.
The submitted sample, Style 11F1G00399, is a men’s suit-type jacket constructed from 65% worsted wool, 20% silk, and 15% flax woven fabric. You state that the average diameter of the wool yarn is 20.7 microns. Style 11F1G00399 is constructed from six panels sewn together lengthwise and features a notched collar with lapels; a button hole on the left lapel; a left-over-right, full front opening with two button closures; long, hemmed, vented sleeves with four buttons on each sleeve; a welt pocket on the left chest; two inset pockets with flaps below the waist; an inner welt pocket on the right front panel; two inner welt pockets and a small inner utility pocket to hold a pen, pencil, etc. on the left front panel; a hemmed bottom with curved edges on the front panels; and two rear vents. The body of the garment is lined with 100% cuprammonium rayon woven fabric, and the sleeves are lined with 60% acetate and 40% cuprammonium rayon woven fabric.
The applicable subheading for Style 11F1G00399 will be 6203.31.9020, Harmonized Tariff Schedule of the United States (HTSUS), which provides for: Men’s or boys’ suits, ensembles, suit-type jackets, blazers, trousers, bib and brace overalls, breeches and shorts (other than swimwear): Suit-type jackets and blazers: Of wool or fine animal hair: Other: Other. The duty rate will be 17.5% ad valorem.
The manufacturing operations for Style 11F1G00399 are as follows:
Non-originating wool, silk, and flax fibers for the outer shell of the garment are imported into Mexico.
In Mexico, the fibers are blended and spun into yarn. Also in Mexico, the yarn is woven into fabric, and the fabric is dyed and finished.
The fabric is exported from Mexico to Guatemala.
Non-originating 100% cuprammonium rayon woven fabric for the lining of the main body of the garment, and non-originating 60% acetate and 40% cuprammonium rayon fabric for the lining of the sleeves, are imported into Guatemala.
The pocket bag fabric and thread are manufactured in either Mexico or another non-DR-CAFTA country, and imported into Guatemala.
In Guatemala, the fabrics are cut, sewn, and assembled into the finished garment.
The garments are exported directly from Guatemala to the United States.
General Note (GN) 29, HTSUS, sets forth the criteria for determining whether a good is originating under the DR-CAFTA. GN 29(b), HTSUS (19 U.S.C. § 1202) states:
For the purposes of this note, subject to the provisions of subdivisions (c), (d), (m) and (n) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good under the terms of this note if—
(i) the good is a good wholly obtained or produced entirely in the territory of one or more of the parties to the Agreement; (ii) the good was produced entirely in the territory of one or more of the parties to the Agreement, and— (A) each of the non-originating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (n) of this note; or (B) the good otherwise satisfies any applicable regional value content or other requirements specified in subdivision (n) of this note; and the good satisfies all other applicable requirements of this note; or (iii) the good was produced entirely in the territory of one or more of the parties to the Agreement exclusively from originating materials.
As the good contains non-originating materials, it must undergo the applicable change in tariff classification specified in GN 29(n) in order to meet the requirements of GN 29(b)(ii)(A).
For goods classified in heading 6203, GN 29(n)/62.12 requires: A change to heading 6203.31 through 6203.33 from any other chapter, except from headings 5111 through 5113, 5204 and 5212, 5310 through 5311, chapter 54, headings 5508 through 5516, 5801 through 5802 or 6001 through 6006, provided that: (A) the good is cut or knit to shape or both, and sewn or otherwise assembled in the territory of one or more of the parties, and
(B) any visible lining material contained in the apparel article must satify the requirements of chapter rule 1 to chapter 62.
In addition to the tariff shift rule set out in GN 29(n)/62.12, the good must also meet any applicable chapter rules found in GN 29(n), Chapter 62. The chapter rules that apply to the subject good are 1, 2, 4, and 5.
GN 29(n), Chapter 61, Chapter rule 2 states: For purposes of determining whether a good of this chapter is originating, the rule applicable to that good shall only apply to the component that determines the tariff classification of the good and such component must satisfy the tariff change requirements set out in that rule for that good.
The component that determines the classification of the subject good is the worsted wool woven fabric. Therefore, this fabric is the only component that must satisfy the tariff shift rule of GN 29(n)/62.12.
The remaining chapter rules (GN 29(n), Chapter 62, Chapter rules 1, 4, and 5) concern the origin of the visible lining fabric, sewing thread, and pocket bag fabric, respectively, that are used in the production of the good. However, as noted below, each of these chapter rules specifically excludes the good at issue:
GN 29(n), Chapter 62, Chapter rule 1 states, in pertinent part:
… the fabrics identified in the following subheadings and headings, when used as visible lining material in certain men's… suit-type jackets… other than men’s suit-type jackets… of wool fabric, of subheadings… 6203.31… provided that such goods are not made of carded wool fabric or made from wool yarn having an average fiber diameter of less than or equal to 18.5 microns, must be both formed from yarn and finished in the territory of one or more parties to the Agreement… GN 29(n), Chapter 62, Chapter rule 4 states, in pertinent part: Notwithstanding chapter rule 2, a good of this chapter, other than—
…(b) men’s… suit-type jackets… of wool fabric, of subheadings… 6203.31… provided that such goods are not made of carded wool fabric or made from wool yarn having an average fiber diameter of less than or equal to 18.5 microns,
containing sewing thread of headings 5204, 5401 or 5508 or yarn of heading 5402 used as sewing thread shall be considered originating only if such sewing thread or yarn is both formed and finished in the territory of one or more of the parties to the Agreement. GN 29(n), Chapter 62, Chapter rule 5 states, in pertinent part:
Notwithstanding chapter rule 2, a good of this chapter, other than—
… (b) men’s… suit-type jackets… of wool fabric, of subheadings… 6203.31… provided that such goods are not made of carded wool fabric or made from wool yarn having an average fiber diameter of less than or equal to 18.5 microns,
that contains a pocket or pockets shall be considered originating only if the pocket bag fabric has been formed and finished in the territory of one or more of the parties to the Agreement from yarn wholly formed in the territory of one or more of the parties to the Agreement.
Style 11F1G00399 is made of worsted wool, and the wool yarn has an average fiber diameter of 20.7 microns. Thus, since Style 11F1G00399 is classified in subheading 6203.31, HTSUS, and the wool fabric comprising its outer shell is not of carded wool fabric and is made from wool yarn that has an average fiber diameter greater than 18.5 microns, chapter rules 1, 4, and 5 do not apply.
Therefore, in determining whether Style 11F1G00399 meets the requirements of GN 29(n)/62.12, it is also necessary to consider only chapter rule 2. As noted above, this chapter rule limits the application of the tariff shift rule to the component that determines the tariff classification of the good, that is, the worsted wool fabric produced in Mexico.
GN 29(d)(vii) sets forth the “cumulation” provision of the DR-CAFTA and provides:
Notwithstanding other provisions of this note, for purposes of determining whether a good of chapter 62 of the tariff schedule is an originating good, materials used in the production of such a good that are produced in the territory of Canada or of Mexico and that would be originating under this note if produced in the territory of a party to the Agreement shall be considered as having been produced in the territory of a party to the Agreement, provided that the United States Trade Representative has determined in a notice published in the Federal Register that the requirements of Appendix 4.1-B of the Agreement specified in subdivision (a) of this note have been met with respect to Canada or Mexico, as the case may be, and has announced the effective date of U.S. note 21 to subchapter XXII of chapter 98 of the tariff schedule. Such goods shall be entered under subheading 9822.05.05 of the tariff schedule, subject to the terms of such U.S. note 21, on or after the effective date specified in such notice. [Compiler’s Note: effective with respect to materials from MX, 8/15/08; reference to subheading 9822.05.05 is obsolete and current provisions appear to be 9822.05.11 and 9822.05.13.]
The worsted wool fabric produced in Mexico, which is used in the production of Style 11F1G00399, would be originating if produced in the territory of a party to the DR-CAFTA. Therefore, in determining whether Style 11F1G00399 is eligible for preferential tariff treatment under the DR-CAFTA, this fabric may be treated as originating pursuant to GN 29(d)(vii).
Based on the facts provided, Style 11F1G00399 qualifies for preferential tariff treatment under the DR-CAFTA. However, it is also necessary to determine whether there is a quantitative limitation on the merchandise eligible for such preferential tariff treatment.
U.S. Note 21, Subchapter XXII, Chapter 98, provides, in relevant part: (a) For purposes of heading 9822.05.11 and 9822.05.13, the treatment provided for in general note 29(d)(vii) to the tariff schedule shall be limited to goods imported into the territory of the United States from a party to the Agreement as defined in general note 29(a)… in aggregate quantities not to exceed the overall limit set forth in subdivision (b) of this note, except as provided in subdivision (c) of this note.
…
(c) The limit of subdivision (b) of this note shall not apply to the following goods made from wool fabric: men’s… suit-type jackets… provided that such goods are not made of carded wool fabric or made from wool yarn having an average fiber diameter of not over 18.5 microns.
Because Style 11F1G00399 is a men’s suit-type jacket made from wool fabric that is not carded wool fabric, and the wool yarn has an average fiber diameter greater than 18.5 microns, U.S. Note 21, Subchapter XXII, Chapter 98, subdivision (c) applies. Accordingly, the garment is not subject to the quantitative limitation set out in U.S. Note 21, Subchapter XXII, Chapter 98, subdivision (b).
Based on the above analysis, Style 11F1G00399 is classified in subheading 9822.05.13, HTSUS, which provides for: Apparel goods of chapter 62 for which the treatment provided in U.S. note 21 to this subchapter is appropriate: Goods specified in U.S. note 21(c) to this subchapter. The applicable duty rate is Free.
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 the World Wide Web at https://hts.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
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 Maryalice Nowak at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division