Mr. Arthur Bodek
Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP
599 Lexington Avenue, 36th floor
New York, NY 10022
RE: The tariff classification of footwear manufactured in the Dominican Republic and the eligibility for preferential treatment under the Dominican Republic - Central America - United States Free Trade Agreement (DR-CAFTA).
Dear Mr. Bodek:
In your letter dated November 30, 2020, you requested a tariff classification ruling on behalf of your client KEEN, Incorporated. Your request concerns the eligibility for preferential duty treatment of footwear under the DR-CAFTA for two styles of footwear described below. Included with your submission were descriptive literature and photographs.
The Terradora II Mid WP (Waterproof) Women ("Terradora") is a woman's closed toe/closed heel, above-the-ankle hiking boot. It measures less than 15 cm and has a lace front closure. The external surface area of the upper is comprised of 59.11 percent plastic and 40.89 percent textile mesh material. The hiking boot is said to have a breathable, waterproof, mesh lining as part of its lightweight, supportive upper. The midsole consists of an arched footbed made from Ethyl Vinyl Acetate (EVA). The rubber or plastics flexible outer sole provides substantial traction during outdoor activity. It is valued at over $24 per pair. The non-originating components including the upper, outer sole, and midsole, sourced from China, and insole sourced from Cambodia, would be classified in various 6406 subheadings of chapter 64, HTSUS. The tape, classified in chapter 39, and the packaging classified in chapter 48, are also sourced from China. The components are permanently assembled into completed footwear in the Dominican Republic from the non-originating materials.
The applicable subheading for Terradora II Mid WP (Waterproof) Women ("Terradora") will be 6402.91.4260, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Other footwear with outer soles and uppers of rubber or plastics: Other footwear: Covering the ankle: Other: Protective active footwear (except footwear with waterproof molded bottoms, including
bottoms comprising an outer sole and all or part of the upper and except footwear with insulation that provides protection against cold weather) whose height from the bottom of the outer sole to the top of the upper does not exceed 15.34 cm. The rate of duty is 20 percent ad valorem.
The Newport H2 Men ("Newport") is a man's, closed-toe/open-heel, below-the-ankle sandal. The majority of the external surface area of the upper consists of polyester textile webbing. The sandal is secured to the foot with an elastic cord lace and a toggle closure. The sandal features a lined, EVA footbed and compression molded midsole. The traction outer sole is constructed of rubber or plastics. The non-originating components including the upper, sourced from China, and outersole unit (midsole and outer sole), sourced from Cambodia, would be classified in various 6406 subheadings of chapter 64, HTSUS. The tape, classified in chapter 39, and the packaging classified in chapter 48, are also sourced from China. The components are permanently assembled into completed footwear in the Dominican Republic from the non-originating materials.
The applicable subheading for the Newport H2 Men ("Newport") will be 6404.19.3940, HTSUS, which provides for Footwear with outer soles of rubber, plastics, leather or composition leather and uppers of textile materials: Footwear with outer soles of rubber or plastics: Other: Footwear with open toes or open heels; Other: Other: Other: For men. The rate of duty will be 37.5 percent ad valorem
Both footwear styles are manufactured into finished footwear in the Dominican Republic from non-originating components sourced from China and Cambodia.
General Note 29, HTSUS, sets forth the criteria for determining whether a good is originating under the DR-CAFTA. General Note 29(b), HTSUS, (19 U.S.C. 1202) states, in pertinent part, that
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; ...
The non-originating materials must undergo an applicable change in tariff classification in order to meet the requirements of GN 29(b)(ii)(A).
General Note 29 (n), Chapter 64, Chapter rule 1 states:
Notwithstanding the tariff classification rules for goods of chapter 64 set forth below, with respect to goods of chapter 64 falling in the following tariff provisions enumerated in this rule for which a rate of duty followed by the symbol "P" in parentheses appears in the "Special" sub column rate of duty column 1, an importer may claim preferential tariff treatment under this note for a good of chapter 64 that meets any tariff classification rule for such good set forth in general note 12, 17, 25, 26 or 28 of the tariff schedule:
tariff items 6401.92.30, 6401.92.60, 6401.99.80, 6402.12.00 through 6402.30.30 inclusive, 6402.30.60, 6402.30.90, 6402.91.40, 6402.91.60, 6402.91.70, 6402.99.05 through 6402.99.18, inclusive, and 6402.99.30 through 6402.99.79, inclusive; heading 6403; tariff items 6404.11.20 through 6404.19.15, inclusive, and 6404.19.25 through 6404.20.60, inclusive; and headings 6405 and 6406.
2. A change to any other tariff item of chapter 64 from any other subheading.
The Newport H2 Men ("Newport") sandal qualifies for U.S./DR-CAFTA preferential treatment because it meets the requirements of HTSUS General Note 29(b)(ii)(A) and 29(n) Chapter 64, Chapter Rule 1. According to Chapter Rule 1, footwear classified in 6404.19.25 through 6404.20.60, may claim preferential tariff treatment. The sandal is classified in 6404.19.3940, HTSUS. The Newport H2 Men ("Newport") will therefore be entitled to a free rate of duty under the U.S./DR-CAFTA upon compliance with all applicable laws, regulations, and agreements.
The Terradora II Mid WP (Waterproof) Women ("Terradora") boot is classifiable in subheading 6402.91.4260, HTSUS, which does not appear in Rule 1 of GN 29(n), to Chapter 64, HTSUS. Accordingly, Rule 1 is not applicable. The Terradora II Mid WP (Waterproof) Women ("Terradora") boot qualifies for U.S./DR-CAFTA preferential treatment because it meets the requirements of HTSUS General Note 29(b)(ii)(A) and 29(n) Chapter 64, Chapter Rule 2, which states the classification of non-originating materials must "change to any other tariff item of Chapter 64 from any other subheading." Under Rule 2 of GN 29 (n) the non-originating component parts which are classifiable in subheading(s) 6406.10.60, HTSUS, (upper), 6406.20.00, HTSUS, (midsole/outer sole) and 6406.90.3060, HTSUS (insole), if imported separately, undergo a tariff change to another tariff item classified in 6402.91.4260, HTSUS. Based on the facts provided, the finished footwear, the Terradora II Mid WP (Waterproof) Women ("Terradora") boot, manufactured in the Dominican Republic from Chinese and Cambodian components qualifies for DR-CAFTA preferential treatment, because it meets the requirements of HTSUS General Note 29(b)(ii)(A) and 29(n) Chapter 64, Chapter Rule 2.
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.
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 Stacey Kalkines at email@example.com.
Steven A. Mack
National Commodity Specialist Division