HQ 0952774 - Country of origin of a country western style men's shirt; 19 CFR 12.130; country of origin textiles - United States International Trade Commision Rulings

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HQ 952774

August 19, 1993

CLA-2 CO:R:C:T 952774 CMR

CATEGORY: CLASSIFICATION

John W. Williams
Ely & Walker Co.
P.O. Box 1326
Lebanon, Tennessee 37087

RE: Country of origin of a country western style men's shirt; 19 CFR 12.130; country of origin textiles

Dear Mr. Williams:

This ruling is in response to your request of October 21, 1992, with regard to a country of origin determination on the manufacture of a country western style shirt.

FACTS:

The garment at issue is a men's long or short sleeve country western style shirt. The shirt has a dress collar, full frontal opening with placket, a yoke across the back extending to the shoulders to which a single panel is sewn, two flap chest pockets and cuffs with three snaps on each cuff (long sleeve) and two ply front yokes.

The manufacturing process of the subject shirt involves marking and cutting of Korean, Chinese, Taiwanese or Pakistani fabric into garment parts in South Korea. The collars will be sewn in South Korea and then the collars and remaining garment parts are sent to Burma (Myanmar) for assembly into the finished shirt. The garment is then packaged and shipped to the United States.

ISSUE:

Is South Korea or Burma the country of origin of the subject shirt?

LAW AND ANALYSIS:

Country of origin rulings on textile articles are based upon the language of Section 12.130 of Volume 19 of the Code of Federal Regulations. Section 12.130 sets out the criteria for determining the country of origin of textile goods. -2-

19 CFR 12.130(e)(1) provides, in pertinent part:

An article or material usually will be a product of a particular foreign territory or country, or insular possession of the U.S., when it has undergone prior to importation into the U.S. in that foreign territory or country, or insular possession any of the following:

(v) Substantial assembly by sewing and/or tailoring of all cut pieces of apparel articles which have been cut from fabric in another foreign territory or country, or insular possession, into a completed garment (e.g. the complete assembly and tailoring of all cut pieces of suit-type jackets, suits, and shirts.) (emphasis added).

Following section 12.130, Customs has consistently ruled that, generally, the complete assembly of a dress shirt, i.e., a tailored woven shirt, is considered a substantial transformation due to the complexity of the assembly and the skill required to produce the tailored garment. Having examined the country western style shirt at issue, in our view, it is similar in construction and tailoring to such woven shirts.

In HRL 951541 of July 30, 1992, Customs ruled on three different manufacturing scenarios for the production of men's dress shirts. One scenario entailed marking and cutting of fabric into garment parts in Hong Kong. Additionally, the collars for the dress shirts were sewn in Hong Kong. Then, all the parts and collars were assembled into the finished shirts, ironed and packed in China. A second scenario is the same as the first with the exception of the cuffs also being sewn in Hong Kong.

Customs ruled in HRL 951541 that the cutting of the garment parts and assembly of the collars in Hong Kong (the first scenario) and the assembly of the collars and cuffs (the second scenario) with the remaining assembly in China, resulted in Hong Kong as the country of origin of the dress shirts. This was due to the fact that only partial assembly took place in China. The partial assembly operation was not considered significant enough to qualify as a "substantial transformation". The ruling relies upon the language of Treasury Decision 85-38 (T.D. 85-38) which is the final document rule establishing 19 CFR 12.130. In T.D. 85-38, it is stated:

The assembly of all the cut pieces of a garment usually is a substantial manufacturing process that results in an article with a different name, character, or use than the cut pieces. It should be noted that not all assembly operations of cut garment pieces will amount to a substantial -3-
transformation of those pieces. Where either less than a complete assembly of all the cut pieces of a garment is performed in one country, or the assembly is a relatively simple one, then Customs will rule on the particular factual situations as they arise, utilizing the criteria in section 12.130(d). (Emphasis added).

The manufacturing process of the subject shirt is essentially identical to the situation ruled upon in HRL 951541; i.e., the garment is only partially assembled in Burma. However, the position taken in HRL 951541 in regard to the subassemblies of the collars, and the collars and cuffs, has been the subject of discussion and review with other government agencies. It has been determined that the position adopted in HRL 951541 was in error. Customs is currently in the process of modifying that ruling to accord with the following analysis.

As stated earlier, following section 12.130(e)(1)(v), the complete assembly of the cut garment parts of a tailored woven shirt is considered a substantial transformation due to the complexity of the assembly and the skill required to produce the tailored garment. The situation at hand presents the issue of whether the subassembly of a component of the garment will prevent the assembly of that component and remaining garment parts from conveying origin. After review of this area and consultation with representatives of the Committee for the Implementation of Textile Agreements, it has been determined that the subassembly of a component (in this case the collar) or components (in the case of HRL 951541, the collar and cuffs), when a relatively minor part of the complete assembly of the garment, will not preclude the subsequent assembly of the subassembled component(s) and remaining garment parts from conveying origin. Therefore, the country of origin of a tailored garment as described in section 12.130(e)(1)(v) will be the country in which the final assembly of the subassembled components and remaining garment parts takes place.

As cited above in T.D. 85-38, when confronted with assembly processes involving assembly of parts and components in more than one country, Customs will rule on the particular factual situations as they arise, utilizing the criteria in section 12.130(d). (Emphasis added). In other words, should the assembly process vary from that presented in this ruling, this ruling would not be applicable. A variation in the division of the assembly process could lead to the same or different conclusion.

Based upon the information you have provided, the country of origin of the subject shirt is the country where the garment parts (including the sub-assembled collars) are assembled, i.e, Burma. -4-

HOLDING:

Based on the information provided, the country of origin of the subject shirt is Burma.

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 177.9(b)(1), Customs Regulations (19 CFR 177.9(b)(1)). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.

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, it is recommended that a new ruling request be submitted in accordance with section 177.2, Customs Regulations (19 CFR 177.2).

Sincerely,

John Durant, Director

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