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HQ 556128

September 26, 1991

CLA-2 CO:R:C:S 556128 SER

CATEGORY: CLASSIFICATION

TARIFF NO.: 9802.00.80

Gail T. Cumins, Esq.
Sharretts, Paley, Carter & Blauvelt
67 Broad Street
New York, NY 10004

RE: Vinyl/textile belts; further fabrication; cutting, die- cutting, sewing, riveting; 19 CFR 10.14(a), 10.16(a),

Dear Ms. Cumins:

This is in reference to your letter of July 3, 1991, on behalf of Overland Products, Inc, requesting a ruling concerning the applicability of subheading 9802.00.80, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), to belts to be imported from Mexico.

FACTS:

The merchandise which Overland plans to import from Mexico is a vinyl/textile belt which will be produced from U.S. and Mexican components. In Mexico, the operations are as follows:

1) U.S.-origin fabric, approximately one inch in width, is exported in rolls to Mexico where it is cut to length by a strip cutter;
2) the belt loop is then die-cut from Mexican vinyl; 3) tabs (end pieces) are die-cut from Mexican vinyl; 4) the buckle is then created by sewing vinyl to wire; 5) the belt is assembled by sewing the tabs to the cut fabric, sewing the belt loop to the tab and riveting the buckle to the tab.

Upon completion of the foreign operations, the belts will be imported into the U.S. You believe that a duty allowance should be granted under subheading 9802.00.80, HTSUSA, for the cost or value of the narrow fabric of U.S. origin.

ISSUE:

Whether the belts will qualify for the partial duty exemption available under subheading 9802.00.80, HTSUSA, when imported into the U.S.

LAW AND ANALYSIS:

Subheading 9802.00.80, HTSUSA, provides a partial duty exemption for:

[a]rticles 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, lubrication, and painting.

All three requirements of subheading 9802.00.80, HTSUSA, must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to duty upon the full cost or value of the imported assembled article, less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of section 10.24, Customs Regulations (19 CFR 10.24).

The only foreign operations which the U.S. fabric undergoes in Mexico are the cutting to length of the fabric, and the final assembly of the U.S. cut fabric to vinyl end pieces of Mexican origin by sewing.

Cutting the fabric to length is an enumerated operation considered incidental to the assembly process pursuant to section 10.16(b)(6), Customs Regulations (19 CFR 10.16(b)(6)), and, therefore, would not preclude the application of the duty exemption of subheading 9802.00.80, HTSUSA, to the U.S. fabric. See also Headquarters Ruling Letter (HRL) 555525 dated June 5, 1990, which held that cutting fabric to length for use in curtains is an operation incidental to assembly.

Section 10.16(a), Customs Regulations (19 CFR 10.16(a)), provides that the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners. Therefore, the sewing and riveting operations performed in Mexico, are considered acceptable assembly operations for purposes of this tariff provision.

HOLDING:

Based on the information and sample presented, it is our opinion that the belts may be entered under subheading 9802.00.80, HTSUSA, with an allowance in duty for the cost or value of the U.S. fabric, upon compliance with the documentary requirements of 19 CFR 10.24.

Sincerely,

John Durant, Director
Commercial Rulings Division

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