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HQ 957985




July 27, 1995

CLA-2 CO:R:C:T 957985 SK

CATEGORY: CLASSIFICATION

TARIFF NO.: 4202.92.9025

Mr. Jimmy Kim
Unique Inc.
350 Fifth Avenue, ste. 807
New York, N.Y. 10118

RE: Classification of soft-sided computer carrying cases; country of origin of soft-sided computer/laptop carrying cases; 4202.92.9025, HTSUSA; 19 CFR 12.130; material cut in Korea; assembly of pre-cut components in China; mere assembly is not substantial transformation; HRL's 951899 (10/31/92); 954225 (8/30/93); 956634 (9/29/94); 957700 (3/29/95); NYRL's 892348

Dear Mr. Kim:

This is in response to your letter of March 20, 1995, requesting both a classification and country of origin determination for five styles of soft-sided computer/laptop carrying cases. This office was provided with four samples of the finished articles, as well as their unassembled components.

FACTS:

The subject computer carrying cases are referenced style numbers K-111, K-312, K-319, 1000 and 1100. Samples of style numbers K-111, K-319, 1000 and 1100 were submitted to this office for examination (no sample of style number K-312 was provided, although Customs is in receipt of a detailed written description of style K-312 which indicates that it is substantially similar in all material respects to the other four carrying cases). All five carrying cases are specially shaped and fitted to accommodate a laptop or notebook computer and feature outer surfaces of
man-made textile materials. Each case has an assortment of accessory pockets and file holders, a top carry handle and removable, adjustable shoulder strap. Foam padding is inserted into the inner linings of the cases' fabric panels. The cases feature either three-side zipper closures, snap closures or buckle closures.

All materials for these computer cases are sourced in Korea. You state that the cases are designed and the fabric is cut into component pieces in Korea. The component parts are then shipped to China for assembly, sewing and packing. In your submission to this office, you provide the following cost breakdown:

STYLE # PERCENTAGE OF TOTAL COST INCURRED IN KOREA

K-111 93.2%

K-312 91.6%

K-319 92.6%

1000 93.9%

1100 94.8%

ISSUES:

1) How are the subject computer cases classified under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA)?

2) What is the country of origin of the subject merchandise?

LAW AND ANALYSIS:
CLASSIFICATION

Classification of merchandise under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is governed by the General Rules of

Interpretation (GRI's). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes, taken in order. Merchandise that cannot be classified in accordance with GRI 1 is to be classified in accordance with subsequent GRI's.

Heading 4202, HTSUSA, provides for, in pertinent part, trunks, suitcases, vanity cases, attache cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers. Customs has consistently deemed soft-sided computer carrying cases to be similar to specially shaped and fitted carrying cases such as typewriter, keyboard or musical instrument carrying cases. In New York Ruling Letters (NYRL's) 892348 and 804688, dated November 30, 1993, and December 6, 1994, respectively, Customs classified soft-sided computer carrying cases with outer surfaces of man-made textile materials under subheading 4202.92.9025, HTSUSA, which provides for, inter alia, other carrying containers and cases with outer surfaces of textile materials, of man-made materials. The five styles of computer carrying cases at issue are also classified within this subheading.

COUNTRY OF ORIGIN

Section 12.130(b) of the Customs Regulations (19 CFR 12.130(b)) provides that textile products that are processed in more than one country or territory shall be products of that country or territory where they last underwent a substantial transformation. Your attention is directed to Section 12.130(e)(v) of the Customs Regulations which states that an article will usually have undergone a substantial transformation (change in country of origin) if it has undergone a substantial assembly of all cut pieces into a completed article.

Customs has long 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. See Headquarters Ruling Letter (HRL) 082747, dated February 23, 1989, in which Customs determined that the assembly of jeans was not a substantial transformation and HRL 082787, dated March 9, 1989, which reached a similar conclusion with regard to a jogging suit.

In the instant case, the assembly process in China involving the sewing together of components cut from fabric in Korea does not involve sufficient skill or complexity to constitute a substantial transformation as defined by the regulations set forth supra. See HRL 951899, dated October 31, 1992, in which Customs issued a country of origin determination for soft-sided luggage manufactured in a similar manner. See also HRL 956634, datedSeptember 29, 1994.

The "value added" to an article is another factor which aids in determining country of origin. See 19 CFR 12.130(d)(2)(v). The greatest costs in producing the computer carrying cases at issue are incurred in Korea as that is where most of the raw materials are sourced and where the material is cut into component parts. In fact, less than 10 percent of the total costs associated with producing all five styles of the computer carrying cases are incurred in China.

The country of origin of the five styles of computer carrying cases is Korea as that is the country where the articles last undergo a substantial transformation. It is in Korea that the articles undergo a substantial manufacturing process (cutting) which transforms the fabric into a new and different article of commerce (computer/laptop carrying cases). Korea is also where the greatest value is added to the subject merchandise.

HOLDING:

Styles numbers K-111, K-312, K-319, 1000 and 1100 are classifiable under subheading 4202.92.9025, HTSUSA, which provides for, inter alia, other carrying containers and cases with outer surfaces of textile materials, of man-made materials. The rate of duty is 19.8 percent ad valorem and the textile quota category is 670.

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 you 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 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.

The country of origin of styles numbers K-111, K-312, K-319, 1000 and 1100 is Korea.

The country of origin 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).

Sincerely,

John Durant, Director
Commercial Rulings Division

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