CLA-2-61:OT:RR:NC:WA:356
Mr. Joseph F. Barry III
CAF Worldwide Inc.
154-09 146th Avenue
Jamaica, NY 11434
RE: The tariff classification and eligibility for preferential duty treatment for men’s T-shirts from Mexico
In your letter dated January 5, 2012, and in previous correspondence dated November 3, 2011, you requested a tariff classification ruling on behalf of YS Garments dba Next Level Apparel.
Style 3600 is a men’s dyed T-shirt constructed from 100% cotton, finely knit jersey fabric that weighs 145 grams per square meter. The garment has a 1x1 rib knit crew neckline; short, hemmed, set-in sleeves; self-fabric binding on the rear neckline and shoulder seams; and a straight, hemmed bottom.
Style 6210 is a men’s dyed T-shirt constructed from 60% cotton, 40% polyester, finely knit jersey fabric that weighs 145 grams per square meter. The garment has a 1x1 rib knit crew neckline; short, hemmed, set-in sleeves; self-fabric binding on the rear neckline and shoulder seams; and a straight, hemmed bottom.
You state that the fabric will be knit and dyed in China and imported into the United States. In the United States, the fabric will be cut into component parts and sent to Mexico for assembly into finished garments. The finished garments will then be imported into the United States. Samples of the component garment pieces as sent to Mexico and samples of the finished garments as returned to the United States were submitted. The component parts include the front and back panels, the sleeves, a rib knit strip for the collar, and a self-fabric strip of fabric that will be used for the neck and shoulder seam binding. A full width sample of the imported non-circular knit fabric, showing each selvedge edge, was also submitted.
The applicable subheading for Styles 3600 and 6210 will be 6109.10.0012, HTSUS, which provides for T-shirts, singlets, tank tops, and similar garments, knitted or crocheted: of cotton: men’s or boys’: other T-shirts: men’s. The general duty rate will be 16.5% 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 http://www.usitc.gov/tata/hts/.
You inquired whether the garments are eligible for preferential treatment under HTS 9802.00.80. Subheading 9802.00.80 provides for partial duty exemption of "Articles, except goods of heading 9802.00.90 and goods imported under provisions of subchapter XIX of this chapter and goods imported under provisions of sub chapter XX, assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process such as cleaning, lubricating and painting.
All three requirements of HTSUSA subheading 9802.00.80 must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to a duty upon the full value of the imported assembled article, less the cost or value of the U.S. components assembled therein, provided there has been compliance with the documentation requirements of section 10.24, Customs Regulation (19 C.F.R. §10.24).
The information submitted is insufficient to make a determination as to the eligibility of the T-shirts under HTS 9802.00.80. Further information regarding the cutting of the neckband fabric is required.
General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that:
For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or (ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that-- (A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or (B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or (iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or (iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts, provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.
Based on the facts provided, the goods described above do not qualify for NAFTA preferential treatment, because none of the above requirements are met.
Section XI, Additional U.S. Note 3 (b) states that: The rate of duty in the “Special” subcolumn of rates of duty column 1 followed by the symbol “MX” in parentheses shall apply to imports from Mexico, up to the annual quantities specified in subdivisions (g) (i) of this note, of apparel goods provided for in chapters 61 and 62 that are both cut (or knit to shape) and sewn or otherwise assembled in the territory of a NAFTA party from fabric or yarn produced or obtained outside the territory of one of the NAFTA parties.
Section XI, Additional U.S. Note 3 (d) states that: Notwithstanding the provisions of subdivisions (b) and (c) of this note, the rate of duty in the “Special” subcolumn of rates of duty column 1 followed by the symbol “MX” in parentheses shall not apply to imports from Mexico of the following: (ii)apparel goods provided for in subheadings 6107.11.00, 6107.12.00, 6109.10.00 and 6109.90.00 if such goods are composed chiefly of circular knit fabric of yarn number equal to or less than 100 metric number.
As the fabric used in the assembly of the T-shirts is not circular knit, the provisions of Additional U.S. Note 3 (d) do not apply. Therefore, the T-shirts may be subject to a reduced rate of duty based upon the Tariff Preference Levels (TPL) established in Section XI, Additional Note 3 (b), up to the annual quantities specified in subdivision (g)(i) of Note 3. Upon completion of the required documentation and up to the specified annual quantities, the garments may be eligible for the preferential free rate of duty.
In addition, you inquired as to the proper marking for this merchandise. The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that unless excepted, every article of foreign origin imported in the U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. As the country of origin of the T-shirts assembled in Mexico will be Mexico, marking the T-shirts as "Assembled in Mexico" or “Made in Mexico” will satisfy the requirements of Section 304, Tariff Act of 1930 (19 U.S. C. 1304).
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181). 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 Mary Ryan at 646-733-3271.
Sincerely,
Thomas J. Russo
Director
National Commodity Specialist Division