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HQ 557954


June 17, 1994

CLA-2 CO:R:C:S 557954 MLR

CATEGORY: CLASSIFICATION

Mr. Mitchell E. Skroski
Komfy Kid Baby Transport Systems
8 Hunters Ridge Drive
Asheville, NC 28803

RE: Eligibility of baby transport system from Jamaica for duty- free treatment under U.S Note 2(b), Subchapter II, Chapter 98, HTSUS; sewing

Dear Mr. Skroski:

This is in response to your letters of April 1 and May 16, 1994, on behalf of Skrozko, Inc. d/b/a Komfy Kid, which were forwarded to us by the Chief, Textile/Plastics Branch, New York Seaport, regarding the applicability of duty-free treatment for a baby transport system to be produced in Jamaica, pursuant to Section 222 of the Customs Trade Act of 1990 (Public Law 101-382), which amended U.S. Note 2, Subchapter II, Chapter 98, Harmonized Tariff Schedule of the United States (HTSUS), {hereinafter "Note 2(b)"}. A sample was submitted with your request. For purposes of this ruling, we assume that you are correct in your claim that the baby transport system is properly classified under subheading 6307.90.9986, HTSUS.

FACTS:

The article at issue is a baby transport system constructed with an outer shell of 100 percent cotton and textile fiber fill. A zippered flap is on the front side. Polypropylene shoulder web straps with plastic buckles are sewn onto the article. The following articles which will be shipped to Jamaica are stated to be of U.S.-origin:
a. fabric cut into various component pieces; b. batting cut to shape; c. zippers cut to approximately 26 inches, the length needed for assembly; d. webbing cut into 1.16 yard pieces; e. black plastic buckles, zipper heads, vinyl patch, and thread; f. velcro cut into various sizes, ranging from 1 to 8 inch strips as needed for assembly; and g. elastic terry cut into .5 yard pieces.

You state that the operations to be performed in Jamaica consist of sewing the component parts together.

ISSUE:

Whether the baby transport system produced in Jamaica is eligible for duty-free treatment under Note 2(b).

LAW AND ANALYSIS:

Section 222 of the Customs and Trade Act of 1990 (Public Law 101-382) amended U.S. Note 2, Subchapter II, Chapter 98, HTSUS, to provide for the duty-free treatment of articles (other than textile and apparel articles, and petroleum and petroleum products) which are assembled or processed in a Caribbean Basin Economic Recovery Act (CBERA) beneficiary country (BC) wholly of fabricated components or ingredients (except water) of U.S. origin.

Note 2(b) provides as follows:

(b) No article (except a textile article, apparel article, or petroleum, or any product derived from petroleum, provided for in heading 2709 or 2710) may be treated as a foreign article, or as subject to duty, if--

(i) the article is--

(A) assembled or processed in whole of fabricated components that are a product of the United States, or

(B) processed in whole of ingredients (other than water) that are a product of the
United States, in a beneficiary country; and

(ii) neither the fabricated components, materials or ingredients, after exportation from the United States, nor the article itself, before importation into the United States, enters the commerce of any foreign country other than a beneficiary country.

As used in this paragraph, the term "beneficiary country" means a country listed in General note 7(a), HTSUS, which includes Jamaica.

Although Note 2(b)(i)(A) and (B) are separated by the word "or", it is out opinion that Congress did not intend to preclude free treatment under this provision to an article which is created in a BC both by assembling and processing U.S. fabricated components and by processing U.S. ingredients.

Note 2(b) specifies four categories of products which are excluded from duty-free treatment under this provision: textile articles, apparel articles, petroleum, and certain products derived from petroleum. The baby transport system is not an apparel or textile article as contemplated by Note 2(b) because subheading 6307.90.9986, HTSUS, is not a provision with a textile category number; therefore, the baby transport system will be eligible for duty-free treatment under Note 2(b) provided that all of the other requirements are satisfied.

You state that the baby transport system will be manufactured by sewing the components together. In regard to the sample presented, we believe that the sewing in Jamaica of the U.S. components into the baby transport system is encompassed by the operations specified in Note 2(b). Therefore, if, in fact, all materials are of U.S.-origin, they are shipped directly from the U.S. to Jamaica, the baby transport system is shipped directly to the U.S. without entering the commerce of any foreign country other than a BC, and the applicable documentary requirements are satisfied, the baby transport system will be entitled to duty-free treatment under this provision.

HOLDING:

Based on the information and sample submitted, we find that the baby transport system made in Jamaica is entitled to duty-free treatment under Note 2(b), assuming it is made wholly from materials of U.S. origin, and upon compliance with the documentation requirements set forth in the enclosed telex.

Sincerely,

John Durant, Director

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