CLA-2-62:OT:RR:NC:N3:356
Mr. Alexis Martinez Medina
Sam Sol, S.A.
KM. 37.5 Carretera Interamericana Santiago Sacatepequez N/A Guatemala
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. Martinez Medina:
In your letter dated May 18, 2023, you requested a ruling on the classification and status under the DR-CAFTA of a men’s suit-type jacket from Guatemala. Our response was delayed due to laboratory testing. Your submitted sample will be retained in our office for training purposes.
The subject garment, for which a style number is not available, is a men’s suit type jacket constructed of 100% worsted wool fabric. You state that the fabric of the outer shell is made of wool yarn with an average fiber diameter of 17.5 microns. The lining is constructed of 100% polyester filament twill fabric and the pocket bag fabric is constructed of 50% polyester filament and 50% cotton woven fabric. The garment is constructed from six panels sewn together lengthwise and features a left-over-right, full front opening with two button closures; a notched collar with lapels; long, hemmed sleeves; a welt pocket on the left chest; welt pockets below the waist; inset pockets on the inner left and right front panels; two rear vents; and a hemmed bottom with curved edges on the front panels.
The applicable subheading for the men’s suit-type jacket will be will be 6203.31.5020, 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: Of worsted wool fabric, made of wool yarn having an average fiber diameter of 18.5 microns or less: Other. The rate of duty will be 17.5 percent ad valorem.
Your request also concerns the eligibility of the suit-type jacket for preferential tariff treatment under the DR-CAFTA.
The manufacturing operations are as follows:
For the outer shell of the garment, wool yarns of unidentified origin are woven into fabric in Mexico. The fabric is then exported to Guatemala.
For the lining of the garment, polyester filament yarns are extruded and formed in Korea and woven into fabric in Korea. The fabric is then exported to Guatemala.
For the pocket bag fabric, polyester filament yarns are extruded in China and cotton yarns are formed in China. These yarns are exported to Mexico, where they are woven into fabric. This fabric is then exported to Guatemala.
The thread used to sew the garment is formed and finished in Honduras and exported to Guatemala.
In Guatemala, the fabrics are cut, sewn, and assembled into the finished garment. The garment is 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 subheading 6203.31, GN 29(n)/62.12 requires: A change to subheadings 6203.31 through 6203.33 from any other chapter, except from headings 5111 through 5113, 5204 through 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 to the Agreement, and
(B) any visible lining material contained in the apparel article must satisfy 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.
Chapter Rule 1:
GN 29(n), Chapter 62, Chapter rule 1 states, in pertinent part:
…the fabrics identified in the following headings and subheadings, 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 of the parties to the Agreement:
5111 through 5112, 5208.31 through 5208.59, 5209.31 through 5209.59, 5210.31 through 5210.59, 5211.31 through 5211.59, 5212.13 through 5212.15, 5212.23 through 5212.25, 5407.42 through 5407.44, 5407.52 through 5407.54, 5407.61, 5407.72 through 5407.74, 5407.82 through 5407.84, 5407.92 through 5407.94, 5408.22 through 5408.24, 5408.32 through 5408.34, 5512.19, 5512.29, 5512.99, 5513.21 through 5513.49, 5514.21 through 5515.99, 5516.12 through 5516.14, 5516.22 through 5516.24, 5516.32 through 5516.34, 5516.42 through 5516.44, 5516.92 through 5516.94, 6001.10, 6001.92, 6005.35 through 6005.44, or 6006.10 through 6006.44.
Since the subject garment is made of worsted wool fabric, it is not made of carded wool fabric. Further, it is made from wool yarn having an average fiber diameter of less than 18.5 microns. Accordingly, Chapter 62, chapter rule 1 is applicable to the subject good. The Customs laboratory tested the visible lining material of the garment and determined that it is constructed of 54.8% non-textured polyester filament and 45.2% textured polyester filament. Accordingly, the visible lining material is classifiable in subheading 5407.69. Because 5407.69 is not one of the tariff numbers listed in Chapter 62, chapter rule 1, this chapter rule is satisfied.
Chapter Rule 2:
GN 29(n), Chapter 62, 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 of the outer shell of the garment. Therefore, this fabric is the only component that must satisfy the tariff shift rule set out in GN 29(n)/62.12. This fabric is woven in Mexico, which is not a party to DR-CAFTA. However, GN 29(d)(vii) sets forth the DR-CAFTA “cumulation” provision, which states:
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 wool fabric is classifiable in heading 5112. The specific rule of origin applicable to this fabric is GN 29(n)/51.3: “A change to headings 5111 through 5113 from any heading.” Because you have not identified the country of origin of the wool yarns used to produce this fabric, we will assume they are produced outside of the DR-CAFTA territory. However, because these yarns are classifiable within headings 5106 through 5109, the fabric would be originating had it been woven within the DR-CAFTA territory.
Nevertheless, for the reasons set out below, the Chapter 98 subheading applicable to the subject garment, if determined to originate under DR-CAFTA, would be 9822.05.11, not 9822.05.13 as you have suggested.
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 the subject garment is a men’s suit-type jacket made from wool yarn having an average fiber diameter of not over 18.5 microns, U.S. Note 21, Subchapter XXII, Chapter 98, subdivision (b) and subheading 9822.05.11 would apply. Accordingly, the garment would be subject to the quantitative limitation set out in that subdivision.
Chapter Rule 4: 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… provided that such goods are not made from 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 heading 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.
As noted above, the subject good is not made of carded wool fabric, and it is made of from wool yarn having an average fiber diameter of less than 18.5 microns. Accordingly, Chapter rule 4 applies to the subject good. While you have not provided fiber content or other information that would enable us to classify the thread used to sew the subject garment, you state that this thread is formed and finished in Honduras. Accordingly, even if classifiable in one of the headings set out in Chapter 62, Chapter rule 4, the thread would satisfy this rule.
Chapter Rule 5:
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… provided that such goods are not made from 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.
Since the subject garment is not made of carded wool fabric, and it is made of from wool yarn having an average fiber diameter of less than 18.5 microns, Chapter rule 5 is applicable. As described above, the pocket bag fabric is woven in Mexico of polyester filament yarns and cotton yarns, both of which were formed in China. Neither Mexico nor China is a party to DR-CAFTA. Accordingly, Chapter 62, Chapter rule 5 is not satisfied.
Additionally, you have asked whether the pocket bag fabric “must be exclusively from a DR-CAFTA country or Mexico.” As noted above, GN 29(d)(vii) allows materials produced in Mexico to be considered as having been produced within the DR-CAFTA territory, provided they would be originating under DR-CAFTA if produced within the DR-CAFTA territory.
However, regardless of whether the pocket bag fabric were found to meet the provisions of GN 29(d)(vii), it is woven from foreign yarns (i.e., yarns formed in China). Therefore, Chapter 62, Chapter rule 5 is not satisfied. See Headquarters Ruling Letter (HQ) H230385, dated September 4, 2012.
The subject garment is not entitled to preferential tariff treatment under the DR-CAFTA because it fails to meet the requirements of HTSUS, GN 29(b)(ii)(A).
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 at https://hts.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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, please contact National Import Specialist Maryalice Nowak at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division