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HQ 953241




April 9, 1993

CLA-2 CO:R:C:T 953241 NLP

CATEGORY: CLASSIFICATION

TARIFF NO.: 6205.20.2050

Ms. Linda Louie
United Customhouse Brokers, Inc.
5777 W. Century Blvd.
Suite 510
Los Angeles, CA 90045

RE: Men's woven co tton shirts; heading 6205; country of origin; fabric hand loomed in India; fabric cut, trimmed and assembled in Singapore; fabric hand loomed and cut in India; assembly of the shirt panels by sewing in Singapore; 19 CFR 12.130; substantial transformation; HRL 951437, 082747 and 951426

Dear Ms. Louie:

This is in response to your letter dated October 5, 1992, to our New York office, on behalf of your client, Foria International, Inc., in which you requested a tariff classification for men's woven shirts under the Harmonized Tariff Schedule of the United States (HTSUS). In addition, you requested a country of origin determination for the woven shirts. A sample of the shirt was submitted for our examination.

FACTS:

The garment at issue is a men's shirt made of woven cotton. It has a full front opening with button closures, short sleeves and a breast pocket with a button closure. It is yarn dyed.

The importer has presented two plans for the manufacture of the shirts. According to the first plan, the fabric for the shirts will be hand loomed in India with no lines of demarcation. The fabric will be sent to Singapore where it will be cut, trimmed and assembled into men's shirts.

According to the second plan, the fabric will be hand loomed in India, where the shirt pattern will be constructed and the fabric will be cut into shirt panels. The shirt panels will then be shipped to Singapore for assembly by sewing. The assembly process will be as follows:

1. The front and back panels will be joined. 2. The sleeves will be attached.
3. The sideseams will be joined.
4. The collar and the cuffs will be attached. 5. The shirt tails will be hemmed.
6. The thread ends will be trimmed.

The shirt will then be washed, inspected, pressed and packaged. The value added to the Indian fabric in Singapore is 5%.

ISSUE:

What is the tariff classification of the men's shirt made of woven cotton?

What is the country of origin of fabric hand loomed in India and cut and assembled into a shirt in Singapore?

What is the country of origin of fabric hand loomed and cut into shirt panels in India and assembled by sewing in Singapore?

LAW AND ANALYSIS:

ISSUE #1

The classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI's may be applied, taken in order.

Heading 6205, HTSUS, provides for "[m]en's or boys' shirts." As this is a men's shirt of woven cotton, it is classifiable in subheading 6205.20.2050, HTSUS, which provides for "[m]en's or boy's shirts: [o]f cotton: [o]ther: [o]ther: [o]ther: [w]ith two or more colors in the warp and/or the filling: [o]ther: [m]en's."

ISSUES #2 AND #3

Country of origin determinations for textile products are subject to Section 12.130 of the Customs Regulations (19 CFR 12.130). Section 12.130(b) provides that a textile product that is processed in more than one country or territory shall be a product of that country or territory where it last underwent a substantial transformation. A textile or textile product will be considered to have undergone a substantial transformation if it has been transformed by means of substantial manufacturing or processing operations into a new and different article of commerce.
Section 12.130(d) of the Customs Regulations sets forth criteria for determining whether a substantial transformation of a textile product has taken place. This regulation states that these criteria are not exhaustive; one or any combination of criteria may be determinative, and additional factors may be considered.

Section 12.130(d)(1) of the Customs Regulations states that a new and different article of commerce will usually result from a manufacturing or processing operation if there is a change in:

(i) Commercial designation or identity.
(ii) Fundamental character or
(iii) Commercial use.

Section 12.130(d)(2) of the Customs Regulations states that in determining whether merchandise has been subjected to substantial manufacturing or processing operations, the following will be considered:

(i) The physical change in the material or article as a result of the manufacturing or processing operations in each foreign territory or country, or insular possession of the U.S.

(ii) The time involved in the manufacturing or processing operations in each foreign territory or country, or insular possession of the U.S.

(iii) The complexity of the manufacturing or processing operations in each foreign territory or country, or insular possession of the U.S.

(iv) The level or degree of skill and/or technology required in the manufacturing or processing operations in each foreign territory or country, or insular possession of the U.S.

(v) The value added to the article or material in each foreign territory or country, or insular possession of the U.S., compared to its value when imported onto the U.S.

Section 12.130(e) of the Customs Regulations sets forth criteria which aid us in determining whether an article has been subjected to certain manufacturing or processing operations which serve to substantially transform an article into a new and different article of commerce. Specifically, Section 12.130(e)(iv) and (v) are relevant in the instant case. This Section provides that:

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:

(iv) Cutting of fabric into parts and the assembly of those parts into the completed articles; or

(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).

We have previously held that cutting of fabric into pattern pieces constitutes a substantial transformation of the fabric, resulting in the apparel pieces becoming a product of the country where the fabric is cut. Customs has also held that the mere assembly of goods entailing simple combining operations, trimming or joining together by sewing is not enough to substantially transform the components of an article into a new and different article of commerce. For example, in Headquarters Ruling Letter (HRL) 951437, dated July 17, 1992, Customs held that the assembly process of women's pants in Malaysia, which involved the sewing together of components that were cut from fabric in Singapore, did not involve sufficient skill or complexity to constitute a substantial transformation as defined by Section 12.130(e)(v). Therefore, the country of origin for the pants was found to be Singapore as that was where the piece goods were cut into specific parts and where the articles last underwent a substantial transformation. See also, HRL 082747, dated February 23, 1989, in which Customs determined that the assembly of jeans was not a substantial transformation.

In the instant case, according to the first manufacturing plan, the hand loomed fabric will be sent to Singapore where it will be cut and trimmed and assembled into the shirts. Based on Section 12.130(e)(iv), a substantial transformation has occurred and the country of origin for the shirts is considered to be Singapore.

In the second plan, the assembly process in Singapore involves the sewing together of several cut pieces to form the shirts. The sewing does not involve sufficient skill or the complex sewing operations required when manufacturing a suit, suit jacket or tailored shirt. In addition, the value added to the fabric is relatively small. Therefore, a substantial transformation of the fabric has not occurred in Singapore. The country of origin of these articles is India as that is where the fabric was cut into specific parts and where the articles last underwent a substantial transformation. See, HRL 951426, dated April 8, 1992, which dealt with the country of origin of a shirt. The fabric for the shirt was woven and printed in Taiwan, cut into garment components in Singapore and was assembled by sewing in Malaysia. The finished garment was returned to Singapore for packing and export to the U.S. HRL 951426 held that the country of origin for the shirt was Singapore as that was where the fabric was cut into its component parts and the assembly operation in Malaysia did not involve the complex sewing operation required by the Section 12.130(e)(v).

HOLDING:

The men's woven cotton shirts are classified in subheading 6205.20.2050, HTSUS, which provides for "[m]en's or boys' shirts: [o]f cotton: [o]ther: [o]ther: [o]ther: [w]ith two or more colors in the warp and/or the filling: [o]ther: [m]en's." The rate of duty is 21% ad valorem and the applicable textile category quota is 340.

The country of origin for the men's shirts manufactured according to the first plan is Singapore.

The country of origin for the men's shirts manufactured according to the second plan is India.

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 the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. Should it subsequently be 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).

The designated textile and apparel categories may be subdivided into parts. If so, the visa and quota requirements applicable to the subject merchandise may be affected. Since part categories are the result of international bilateral agreements which are subject to frequent renegotiations and changes, to obtain the most current information available we suggest the importer check, close to the time of shipment, the Status Report on current Import Quotas (Restraint Levels), an internal issuance of the U.S. Customs Service which is updated weekly and is available for inspection at your local Customs office.

Due to the changeable nature of the statistical annotation (the ninth and tenth digits of the classification) and the restraint (quota/visa) categories, you should contact your local Customs office prior to importation of this merchandise to determine the current status of any import restraints or requirements.

Sincerely,

John Durant, Director
Commercial Rulings Division

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