CLA2-RR:NC:TA:351 G87295
Julie Demoraes
Norman Krieger Inc.
5761 W. Imperial Hwy
Los Angeles, CA 90045
RE: Classification and country of origin determination for cotton yarn; 19 CFR 102.21(c)(2); tariff shift; CBERA; heading 9802, HTS.
Dear Ms. Demoraes:
This is in reply to your letter dated February 9, 2001, on behalf of your client Textufil, S.A de C.V., of El Salvador, requesting a classification and country of origin determination for cotton yarn which will be imported into the United States.
FACTS:
The subject merchandise consists of 100% cotton ring spun carded yarn (ne 20/1, nm 33.9) and 100% cotton ring spun combed yarn (ne 30.5/1, nm 51.64).
The manufacturing operations for the yarns are as follows:
Raw cotton, grown in the U.S., is exported to El Salvador where your client processes it through carding, draw frame, roving frame, spinning, cone winding, and packing for export to the U.S.
ISSUE:
What are the classification and country of origin of the subject merchandise, and will it qualify for duty-free treatment under heading 9802, Harmonized Tariff Schedule of the United States Annotated, (HTSUSA), or under the Caribbean Basin Initiative (CBI)?
CLASSIFICATION:
Your letter inquires if the yarn would be eligible under heading 9802, HTS. Heading 9802 provides for articles 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. As the raw cotton of U.S. origin is not a fabricated component but is in fact a raw material which is subjected to a manufacturing process, that is, spinning, heading 9802, HTS, is precluded.
The applicable subheading for the carded yarn will be 5205.12.1000, (HTSUSA), which provides for cotton yarn (other than sewing thread), containing 85 percent or more by weight of cotton, not put up for retail sale, single yarn, of uncombed fibers, exceeding 14 nm but not exceeding 43 nm, unbleached, not mercerized. The rate of duty will be 5.2 percent ad valorem.
The applicable subheading for the combed yarn will be 5205.23.0020, HTS, which provides for cotton yarn (other than sewing thread), containing 85 percent or more by weight of cotton, not put up for retail sale, single yarn, of combed fibers, exceeding 43 nm but not exceeding 52 nm, unbleached, not mercerized. The rate of duty will be 8.6 percent ad valorem.
Subheading 5205.12.1000 falls within textile category designation 300. Subheading 5205.23.0020 falls within textile category designation 301. The designated textile and apparel categories and their quota and visa status are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information, we suggest that you check, close to the time of shipment, the U.S. Customs Service Textile Status Report, an internal issuance of the U.S. Customs Service, which is available at the Customs Web Site at WWW.CUSTOMS.GOV. In addition, the designated textile and apparel categories may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected and should also be verified at the time of shipment.
COUNTRY OF ORIGIN - LAW AND ANALYSIS:
On December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act (codified at 19 U.S.C. 3592) provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. On September 5, 1995, Customs published Section 102.21, Customs Regulations, in the Federal Register, implementing Section 334 (60 FR 46188). Thus, effective July 1, 1996, the country of origin of a textile or apparel product shall be determined by sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.
Paragraph (c)(1) states that “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 that “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 that “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
5204-5207 A change to heading 5204 through 5207 from any heading outside that group, provided that the change is the result of a spinning process.
As both yarns are spun in a single country, that is, in El Salvador, as per the terms of the tariff shift requirement, country of origin is conferred in El Salvador.
Your letter also inquires about the status of the yarn under CBI, by which we presume you mean its successor, the Caribbean Basin Economic Recovery Act (CBERA). Eligibility under CBERA is indicated in the HTS by the letter E or E* in the column headed “Special” under “Rates of Duty.” Neither subheading 5205.12.1000 nor 5205.23.0020 has the E or E* in that column, so there is no CBERA eligibility for this merchandise.
HOLDING:
The country of origin of the cotton yarns is El Salvador. Based upon international textile trade agreements products of El Salvador are subject to quota and the requirement of a visa.
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 Mitchel Bayer at 212-637-7086.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division