CLA-2-63:OT:RR:NC:N3:351
Mr. Tiago Lopes
ShadeFX Canopies Inc
2340 Meadowvale Boulevard, Unit 8 Mississauga, Ontario L5N0H1 Canada
RE: Classification, country of origin determination, and eligibility under the United States-Mexico-Canada Agreement (USMCA) of retractable canopies from Canada; 19 CFR 102.21(c)(2); tariff shift
Dear Mr. Lopes:
In your letter dated April 4, 2024, you requested a classification, country of origin determination, and eligibility under the United States-Mexico-Canada Agreement (USMCA) ruling. In lieu of a sample, photographs of the retractable canopies were provided with your request.
The item, described as a ShadeFX Retractable Canopy, is an outdoor retractable canopy designed to be attached to the underside of a pergola or gazebo and is intended to provide shade. The canopy is detached from the pergola or gazebo and stored during the winter months. The canopy is composed of 100 percent acrylic woven fabric and treated with a water repellant finish. The fabric is cut, ultrasonically sealed, and attached to aluminum horizontal wings, spaced 8 to 36 inches apart, to create the canopy assembly. The canopy assembly is attached to an aluminum track assembly by gravity clips. The track assembly is available in three different operational models: motor, manual, or rope. The completed retractable canopy, in its extended position, will vary in width between 8 feet to 18 feet and in length between 8 feet to 24 feet. The SKU# will be delineated based on the model type and size: manual operated (SFX-RC-UH-1001 to SFX-RC-UH-1044); rope operated (SFX-RC-UR-1001 to SFX-RC-UR-1039). The retractable canopy is imported with its hardware and installation instructions from Canada.
This office will not provide a classification, country of origin determination, and eligibility of USMCA on the motor operated retractable canopy in view of pending litigation in Lutron Electronics Co., Inc. v. United States, CIT No. 22-00264 (Lutron).
You state the manufacturing operations for the manual and rope operated ShadeFX Retractable Canopy, are as follows:
China:
Great Britain:
India:
Italy:
Taiwan:
Thailand:
Turkey:
United States:
Vietnam:
Canada:
ISSUES:
What is the classification, country of origin, and USMCA eligibility for the ShadeFX Retractable manual and rope operated canopy?
CLASSIFICATION:
You suggested that the ShadeFX retractable manual and rope operated canopy should be classified under 6306.22, Harmonized Tariff Schedule of the United States, (HTSUS), which provides for Tarpaulins, awnings and sunblinds; tents (including temporary canopies and similar articles); sails for boats, sailboards or landcraft; camping goods: Tents: Of synthetic fibers. We disagree. The item is a retractable textile canopy that does not have any walls, necessary to permit the formation of an enclosure or shelter and provide protection from the elements. Therefore, the item will not be considered a tent. The applicable subheading for the ShadeFX retractable manual and rope operated canopy will be 6307.90.9891, HTSUSA, which provides for Other made up articles, including dress patterns: Other: Other: Other: Other: Other. The 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 the World Wide Web at https://hts.usitc.gov/current.
COUNTRY OF ORIGIN - LAW AND ANALYSIS:
Section 334 of the Uruguay Round Agreements Act (URAA) (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provides the rules of origin for textile and apparel products entered, or withdrawn from warehouse for consumption on and after July 1, 1996. Section 334 of the URAA was amended by section 405 of title IV of the Trade and Development Act of 2000, Public Law 106-200, 114 Stat. 251. Section 102.21 of Title 19 of the Code of Federal Regulations (19 C.F.R. 102.21), implements the URAA. Thus, the country of origin of a textile or apparel products will be determined by the sequential application of the general rules set forth in paragraphs (c)(1) through (5) of section 102.21 and, where appropriate to the specific context, by application of the additional requirements or conditions of section 102.12 through 102.19 of this part.
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 subheading 6307.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.
Accordingly, as the fabric for the ShadeFX retractable manual and rope operated canopy was manufactured in the United States, as per the terms of the tariff shift rule for heading 6307, HTSUS, the country of origin of the ShadeFX retractable manual and rope operated canopy is the United States. Please note that the use of the phrase Made in the U.S.A. or similar words denoting U.S. origin is under the jurisdiction of the Federal Trade Commission (FTC). Consequently, any inquiries regarding the use of such phrases reflecting U.S. origin should be directed to the FTC, at the following address: Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, D.C. 20580. Information can also be found at the FTC website www.ftc.gov.
USMCA ELIGIBILITY:
The United States-Mexico-Canada Agreement (USMCA) was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. 4511(a)). General Note (GN) 11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good is an originating good for purposes of the USMCA. GN 11(b) states:
(b) For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a "good originating in the territory of a USMCA country" only if
(i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries;
(ii) the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials;
(iii) the good is a good produced entirely in the territory of one or more USMCA countries using nonoriginating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o)); or
Since the ShadeFx retractable manual and rope operated canopy contains various components from China, Great Britain, India, Italy, Taiwan, Thailand, Turkey, and Vietnam, it is not considered a good wholly obtained or produced entirely in a USMCA country under GN 11(b)(i) nor is it produced exclusively from originating materials under GN 11(b)(ii). Therefore, we must next determine whether the ShadeFX retractable manual or rope operated canopy qualifies under GN 11(b)(iii); which includes the provisions of subdivision (o).
The applicable provisions under subdivision (o) include two Chapter Rules under Chapter 63 and the rule of origin which are as follows:
Chapter Rule 1: For the purposes of determining the origin of a good of this chapter, 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 the rule for that good.
Chapter Rule 2: Effective January 1, 2022, and not withstanding chapter rule 1 of this chapter, for the purposes of determining the origin of a good of this chapter, a good of this chapter containing fabrics of heading 5903 shall be considered originating only if all fabrics used in the production of the fabrics of heading 5903 are formed and finished in the territory of one or more of the USMCA countries. This note shall not apply to goods of heading 6305, goods of subheadings 6306.12 or 6306.22 or goods of subheading 6307.90 that are not surgical drapes or national flags.
5. A change to headings 6304 through 6310 from any other chapter, except from headings 5106 through 5113, 5204 through 5212, 5310 through 5311, chapters 54 through 55 or headings 5801 through 5802 or 6001 through 6006, or other made-up textile articles of heading 9619, 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 USMCA countries.
In the instant case, the ShadeFX retractable manual and rope operate canopy is classified by application of General Rule of Interpretation (GRI) 1 under heading 6307, HTSUS. Therefore, there is no need to employ an essential character analysis to classify the ShadeFX retractable manual or rope operated canopy as provided for under Chapter Rule 1. Accordingly, Chapter Rule 1 does not apply in this case to restrict the application of the tariff shift rule to a specific component in the subject ShadeFX retractable manual or rope operated canopy, but it does serve to eliminate from consideration those components not considered in classifying the ShadeFX retractable manual or rope operated canopy such as screws, nuts, bolts, bearing wheel, handles, foam. See, e.g., HQ H043056 (May 5, 2009). Thus, the tariff shift rule applies to the fabric used to produce the ShadeFX retractable manual or rope operated canopy. Because the 100 percent acrylic woven fabric was woven in the U.S. from yarns wholly formed in the U.S. from staple fiber from Turkey, it is an originating material and does not have to meet the terms of the tariff shift. Therefore, the ShadeFX retractable manual or rope operated canopy does qualify for preferential tariff treatment under the USMCA.
HOLDING:
The applicable subheading for the ShadeFX retractable manual or rope operated canopy will be 6307.90.9891, HTSUSA, which provides for Other made up articles, including dress patterns: Other: Other: Other: Other: Other. The applicable rate of duty is 7 percent ad valorem.
The country of origin of the ShadeFX retractable manual or rope operated canopy is the United States.
The criteria required for preferential treatment under the USMCA has been satisfied based upon an analysis of the facts provided. Therefore, the ShadeFX retractable manual or rope operated canopy is eligible for preferential tariff treatment under the USMCA.
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.
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 Kristine Dodge at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division