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HQ 954306

July 29, 1993

CLA-2 CO:R:C:M 954306 DWS

CATEGORY: CLASSIFICATION

TARIFF NO.: 9401.90.10

Mr. Bruce N. Shulman
Stein Shostak Shostak & O'Hara
1620 L Street, N.W., Suite 807
Washington, DC 20036-5605

RE: Coated Nylon Fabric Pieces; Automobile Seat Parts; Air Bladders; Explanatory Note 94.01; Country of Origin; 19 CFR 134.1(b); Ferrostaal Metals Corp. v. U.S.

Dear Mr. Shulman:

This is in response to your letter of May 26, 1993, on behalf of American Components, Inc., concerning the country of origin and classification of pieces of textile and plastic sheet goods under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The merchandise consists of pieces of textile and plastic sheet goods. Nylon fabric coated with polyetherurethane and polyetherurethane sheeting in continuous rolls is purchased from sources in Asia, and is then imported into Mexico. In Mexico, the rolls will be cut into pieces specifically dedicated for use in the final assembly of automobile seat air bladders in the U.S. The air bladders are used in automobile seats as lumbar supports, the amount of support depending on the volume of air in the bladder.

Finished automobile seat air bladders are composed of three pieces cut from the sheet goods. The first piece is composed of nylon coated with polyetherurethane and is used to secure the air bladder in a fixed position within an automobile seat. The piece measures approximately 14 inches by 10 1/2 inches, and has a hole, approximately 5/16 inch in diameter, which is centered between both edges and is approximately 3 inches from the top. This piece also has 13 small holes at each end, 10 of which are round and measure approximately 1/8 inch in diameter, and 3 of which are rectangular and measure approximately 1/8 inch by 5/8 inch. In the U.S., the edges containing the holes will be folded over and heat sealed to form two small pockets into which hooks will be inserted. The pockets will be used to secure the entire air bladder within the seat.

The two other pieces are the components which hold the air, and they are composed of polyetherurethane sheeting. When assembled together by heat sealing, these pieces form a pillow- like bladder which, in turn, is heat sealed to the first piece. The two pieces measure approximately 9 inches by 9 inches. Both pieces have edges which are concave, the center portions of which are set back approximately 1/4 inch from the edge at the corners. One of the pieces has a hole into which an air tube is inserted.

The subheading under consideration is as follows:

9401.90.10: [p]arts: [o]f seats of a kind used for motor vehicles.

The general, column one rate of duty is 3.1 percent ad valorem.

ISSUE:

Whether the coated nylon fabric pieces are classifiable under subheading 9401.90.10, HTSUS, as parts of automobile seats?

Whether the country of origin of the pieces is Mexico?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUS is in accordance with the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification is determined according to the terms of the headings and any relative section or chapter notes.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes, although not dispositive, are to be used to determine the proper interpretation of the HTSUS. 54 Fed. Reg. 35127, 35128 (August 23, 1989). Explanatory Note 94.01 (p. 1575) states that:

[t]his Chapter only covers parts, whether or not in the rough, of the goods of headings 94.01 to 94.03 and 94.05, when identifiable by their shape or other specific features as parts designed solely or principally for an article of those headings. They are classified in this Chapter when not more specifically classified elsewhere.

It is our position that the subject pieces are identifiable by their irregular shape and other features as parts designed solely for the automobile seats of heading 9401, HTSUS. The pieces are not more specifically classified elsewhere in the HTSUS. The pieces are parts of air bladders which, in turn, are parts of automobile seats. They are specially cut to shape and are processed in such a way that they are identifiable solely as parts of automobile seats. Consequently, we find that the pieces are classifiable under subheading 9401.90.10, HTSUS.

We will now deal with the country of origin of the pieces. "Country of origin" is defined in section 134.1(b), Customs Regulations [19 CFR 134.1(b)], as "the country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the 'country of origin' within the meaning of this part."

"The essence . . . is that a product cannot be said to originate in the country of exportation if it is not manufactured there. The question, therefore, is whether operations performed on products in the country of exportation are of such a substantial nature to justify the conclusion that the resulting product is a manufacture of that country. 'Manufacture' implies a change, but every change is not manufacture . . . There must be transformation; a new and different article must emerge, 'having a distinctive name, character or use'." Ferrostaal Metals Corp. v. U.S., 11 CIT 470, 473 (1987).

The subject pieces, produced from coated nylon fabric rolls purchased in Asia, are processed in Mexico. Based upon the above described processing of the pieces, it is our position that a substantial transformation has occurred in Mexico, and a new and different article has emerged having a "distinctive name, character or use". After processing in Mexico, the rolls are substantially transformed into parts of automobile seats. Therefore, we find that the country of origin of the subject pieces is Mexico.

HOLDING:

The coated nylon fabric pieces are classifiable under subheading 9401.90.10, HTSUS, as parts of automobile seats. Articles from Mexico classifiable under subheading 9401.90.10, HTSUS, have previously been eligible for duty free treatment under the Generalized System of Preferences (GSP), upon compliance with the requirements in sections 10.171 - 10.178, Customs Regulations (19 CFR 10.171 - 10.178). However, because the GSP expired at midnight on July 4, 1993, duties at the rate of 3.1 percent ad valorem must now be deposited. Legislation which would reinstate the GSP retroactively has been proposed but has not been enacted.

The country of origin of the coated nylon fabric pieces is Mexico.

Sincerely,

John Durant, Director

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