CLA 2-OT:RR:NC:N3:351
Ms. Vicky Benedict
V.B. Inc.
652 Chapel Dr.
Raleigh, NC 27606
RE: Classification and country of origin determination for knit face masks; 19 CFR 102.21(c)(2); tariff shift; eligibility for duty-free treatment under Generalized System of Preferences (GSP)
Dear Ms. Benedict:
This is in reply to your letter dated April 9, 2020, requesting a classification, country of origin and eligibility under the Generalized System of Preferences (GSP) determination for face masks which will be imported into the United States. In lieu of a sample, a photograph was provided with your request.
FACTS:
The subject merchandise, model 5X7AB3PCM, is a reusable, 3-ply, 100 percent cotton knit face mask with an antimicrobial finish. The face mask measures approximately 5 x 7 inches. The mask features self-fabric binding that extends to form loops on either side. The loops are placed behind the ears to secure the mask to the face.
The manufacturing operations for the mask is as follows:
United States
Knit fabric (6006.21) and thread (5204.11) are formed.
Rolls of fabric and thread are exported to either Ecuador or Haiti.
Ecuador or Haiti
Fabric is cut and sewn.
Completed mask is exported to the United States.
ISSUE:
What are the classification and country of origin of the subject merchandise? Are the masks eligible for duty-free treatment under Generalized System of Preferences (GSP)?
CLASSIFICATION:
The applicable subheading for the face masks will be 6307.90.9889, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Other made up articles, including dress patterns: Other: Other: Other: Other: Other.” The general rate of duty will be 7 percent ad valorem.
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 https://hts.usitc.gov/current.
COUNTRY OF ORIGIN - LAW AND ANALYSIS:
Section 334 of the Uruguay Round Agreements Act (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provided rules of origin for textiles and apparel entered, or withdrawn from warehouse for consumption, on and after July 1, 1996. Section 102.21, Customs Regulations (19 C.F.R. 102.21), published September 5, 1995 in the Federal Register, implements Section 334 (60 FR 46188). Section 334 of the URAA was amended by section 405 of the Trade and Development Act of 2000, enacted on May 18, 2000, and accordingly, section 102.21 was amended (68 Fed. Reg. 8711). Thus, the country of origin of a textile or apparel product shall be determined by the 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
6307.90 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 is knit in a single country, that is, the United States, as per the terms of the tariff shift requirement, country of origin is conferred in the United States.
When the country of origin is conferred in the United States, Subchapter II, Note 2(a) to Chapter 98, HTSUS, applies. The Note states in part that “…any product of the United States which is returned after having been advanced in value or improved in condition abroad by any process of manufacture or other means, or any imported article which has been assembled abroad in whole or in part of products of the United States, shall be treated for the purposes of this Act as a foreign article, and, if subject to a duty which is wholly or partly ad valorem, shall be dutiable, except as otherwise prescribed in this part, on its full value determined in accordance with section 402 of the Tariff Act of 1930, as amended.” Therefore, in accordance with Subchapter II, Note 2(a) to Chapter 98, HTSUS, and Section 102.21(c)(2), the country of origin of the masks is the United States; however, for duty purposes the masks are subject to the general rate of duty noted previously.
Inasmuch as the marking requirements of 19 U.S.C. 1304 are applicable only to articles of “foreign origin,” the subject masks are not required to be marked upon importation into the United States. 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.
GENERALIZED SYSTEM OF PREFERENCES – LAW AND ANALYSIS:
Articles classifiable under subheading 6307.90.9889, HTSUS, which are products of either Haiti or Ecuador are currently entitled to duty free treatment under the Generalized System of Preferences (GSP) upon compliance with all applicable regulations and statutory requirements.
In general these requirements described under General Note 4(c), HTSUS, are that the eligible article be imported directly from a beneficiary developing country (BDC) into the customs territory of the United States, and that the sum of (1) the cost or value of the materials produced in the beneficiary developing country or any 2 or more countries which are members of the same association of countries which is treated as one country under section 507(2) of the Trade Act of 1974, plus (2) the direct costs of processing operations performed in such beneficiary developing country or such member countries is not less than 35 percent of the appraised value of such article at the time of its entry into the customs territory of the United States. In your request, you state the value of materials produced in Ecuador or Haiti plus the direct costs of processing operations performed there is less than 35 percent of the appraised value of mask. As a result, the masks are ineligible for duty-free treatment under GSP.
HOLDING:
The country of origin of the mask, model 5X7AB3PCM, is the United States. The applicable subheading for the mask is 6307.90.9889, HTSUS, dutiable at 7 percent ad valorem. The mask is not eligible for GSP.
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, either directly, by reference, or by implication, is accurate and complete in every material respect.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). 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.
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 Kim Wachtel at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division