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HQ 560081

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March 13, 1997
CLA-2: RR:TC:SM 559981 BLS

CATEGORY: CLASSIFICATION

TARIFF NO.: 9615.90.20

Ms. Tania Balog
Ranko Balog Co.
8924 Bellanca Avenue
Los Angeles, CA 90045-4700

RE: Eligibility of eyelash curler kit for preferential duty treatment under NAFTA; country of origin marking; sets; GRI 3(b); subheading 9615.90.20; Article 509

Dear Ms. Balog:

This is in reference to your letter dated September 11, 1996, requesting whether an eyelash curling system is eligible for preferential treatment under the North American Free Trade Agreement (NAFTA) upon return from Mexico, and the country of origin marking requirements for such product. You also inquire as to the tariff classification of the kit, and whether it will qualify for duty-free treatment under subheading 9802.00.50, Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The kit consists of various items, including an eyelash curler, heating unit, cosmetics, and an instruction sheet. The eyelash curler is produced in Taiwan, and then shipped to Mexico for inclusion in the kit.

Items sent to Mexico from the U.S. will include:

1. Injection molded shell
2. PC Boards
3. Electronic components for the PC board. 4. Lead wires.
5. Battery clips.
6. LED light.

7. Mascara and eyelash oil.
8. Instruction sheet.
9. Possible packaging box.
10. Screws.

For the purposes of this ruling, we will assume from these facts that the foregoing items are of U.S.-origin.

In Mexico, processing will be as follows:

1. Assembly of small circuitry components onto a PC board. 2. Assembly of the finished PC board, battery clips, LED light lead wires and screws into the product housing shell.
3. Final assembly of the heating unit.
4. Placement of the eyelash curler into the specially molded opening in the heating unit, and packaging of the unit, curler, U.S.-origin cosmetics and instruction sheet into the shipping box.

ISSUES:

1) What will be the proper classification of the "Hot Lashes" curling system upon importation into the U.S.?

2) What are the country of origin marking requirements for the imported kit?

3) Whether the product will be eligible for preferential treatment under the NAFTA upon importation.

4) Whether the "Hot Lashes" system will be eligible for duty-free treatment under subheading 9802.00.50, HTSUS, upon importation.

LAW AND ANALYSIS:

A. Classification

According to the information provided, upon importation into the U.S. the eyelash curling system will consist of an eyelash curler with incorporated silicon pad,
a heart-shaped plastic housing unit, specifically molded to fit the eyelash curler and heat the silicone pad of the eyelash curler, and a retail-sized, separately packaged mascara and eyelash night oil. The package also contains an instruction sheet.

Inasmuch as the imported article is described by more than two headings, it cannot be classified according to GRI 1, HTSUS. Classification of goods consisting of more than one material or substance shall be according to the principles of GRI 3. GRI 3(a) is inapplicable because none of the relevant headings, namely 9615, 8516 and 3304, provide a specific description but each refers to only part of the items. The eyelash curling system is not a composite good because it fails to "form a whole which would not normally be offered for sale in separate parts." See EN (IX) GRI

We consider the "Hot Lashes" system to be a set under GRI 3(b), because it consists of different articles that are put up together for the care and beautification of eyelashes in a retail-sized package for direct sale to the consumer. GRI 3(b), HTSUS, provides in part that the goods put up in sets for retail sale, which cannot be classified by reference to GRI 3(a), shall be classified as if they consisted of the component which gives them their essential character. The eyelash curler, by itself, is classifiable as a nonthermic, nonornamental device for curling the hair. See Headquarters Ruling Letter (HRL) 955840 dated March 1, 1994. The eyelash curler is the component which gives the set its essential character because of its role in relation to the use of the other items of the set, such as the battery-operated heating unit, eye mascara and eyelash oil. Without the eyelash curler, the eyelashes cannot be curled and the heating unit becomes meaningless to the set. As such, the set takes on the classification of the eyelash curler.

The applicable subheading for the "Hot Lashes" curling system is subheading 9615.90.20, HTSUS, the provision for "[C]ombs, hair-slides and the like; hairpins, curling pins, curling grips, hair-curlers and the like, other than those of heading 8516, and parts thereof; [o]ther: [n]onthermic, nonornamental devices for curling the hair." The rate of duty under general column one is 8.1 percent ad valorem and the special column rate for goods of Mexico qualifying for NAFTA is a free rate of duty.

B. NAFTA Preference

To be eligible for preferential treatment under the NAFTA, goods must be "originating goods" within the rules of origin in General Note 12(b), HTSUS.

General Note 12(b), HTSUS, states in pertinent part:

[f]or the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--

(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico, and/or the United States; or

(ii) they have been transformed in the territory of
Canada, Mexico and/or the United States so that--

(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or

(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) where no change in tariff classification is required, and the goods satisfy all other requirements of this note...

Since the eyelash curler is considered a non-originating material, we must examine whether this component of the set undergoes the required transformation in Mexico pursuant to General Note 12(b)(ii)(A), HTSUS.

In this regard, both the non-originating eyelash curler and the imported "Hot Lashes" set are classified under subheading 9615.90.20, HTSUS. The rule applicable
to goods of subheading 9615.90.20, HTSUS, is provided for in General Note 12(t)/96.15--12(t)97, HTSUS, which provides, in pertinent part, the following:

"16. A change to subheading 9615.90 from any other heading."

Since the non-originating eyelash curler does not undergo the required transformation, the imported set will not qualify for NAFTA Preference upon importation.

C) Country of Origin Marking

The marking statute, section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. Part 134, Customs Regulations
(19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.

The country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the NAFTA, as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057) (December 8, 1993) and the regulations set forth in 19 CFR Parts 102, 134.

Section 134.1(b) (19 CFR 134.1(b)) of the regulations defines "country of origin" as:

The country of manufacture, production, or growth of any article of foreign origin entering the U.S.
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"; however, for a good of a NAFTA country, the NAFTA
Marking Rules will determine the country of origin.

Section 134.1(j) provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules.

Part 102 of the regulations (19 CFR Part 102), sets forth the "NAFTA Marking Rules" for purposes of determining whether a good is a good of a NAFTA country. Section 102.11 of the regulations (19 CFR 102.11) sets forth the required hierarchy for determining country of origin for marking purposes. Section 102.11(a) provides that "[t]he country of origin of a good is the country in which:

(1) The good is wholly obtained or produced;

(2) The good is produced exclusively from domestic materials; or

(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section
102.20 and satisfies any other applicable requirements of that section, and all other requirements of these rules are satisfied."

"Foreign Material" is defined in section 102.1(e) of the regulations as "a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced."

In this regard, we find that the heating unit, classifiable under subheading 8516.32, HTSUS ([E]lectric instantaneous or storage water heaters and immersion heaters, ...electrothermic hair dressing apparatus...Other hairdressing apparatus), is considered a product of Mexico, as the U.S.-origin components which are assembled in Mexico undergo the required tariff shift pursuant to the applicable rule, which requires "A change to subheading 8516.10 through 8516.79 from any other subheading, including another subheading within that group." See section 102.20(o), Section XVI: Chapters 84 through 85. The eyelash curler is a product of Taiwan, and, as stated, the cosmetics included with the kit are of U.S.-origin.

Since the "Hot Lashes" set is neither wholly obtained or produced, nor produced exclusively from domestic (Mexican) materials, section 102.11(a)(3) is the applicable
rule which must first be applied. In order to determine whether Mexico is the country of origin under this rule, we must lo ok at those materials whose country of origin is other than Mexico, which includes material of U.S-origin ("Foreign Material" under 19 CFR 102.11(e)).

As the set is classified under subheading 9615.90.20, HTSUS, the change in tariff classification must be made in accordance with the applicable rule set forth in section 102.20(s), Customs Regulations (19 CFR 102.20(s)), Section XX: Chapters 94 through 96. This rule provides as follows:

A change to subheading 9615.11 through 9615.90, including another subheading within that group.

Since the "Hot Lashes" set includes the eyelash curler which is classified under subheading 9615.90, HTSUS, and which therefore does not undergo a tariff shift, the country of origin cannot be determined under 19 CFR 102.11(a)(3). Furthermore, since the eyelash curler and U.S. cosmetics are merely packaged together for importation without more than minor processing, they will not be considered to have met the applicable change in tariff classification set out in 19 CFR 102.20. See 19 CFR 102.17. Section 102.11(b) cannot be used to determine origin since it is not applicable to "sets" classified as such under the HTSUS.

Where the country of origin cannot be determined under 19 CFR 102.11(a) or (b), and the article is specifically described in the Harmonized System as a set or mixture, or classified as a set, mixture or composite good pursuant to GRI 3, 19 CFR 102.11(c) is the rule which must then be applied. Under this rule, the country of origin is the country or countries of origin of all materials that merit equal consideration for determining the essential character of the good. All of the components of the set, foreign and domestic, which merit equal consideration, must be considered. In this case, the eye lash curler, heating unit, eye mascara and eyelash oil merit equal consideration in determining the essential character of the "Hot Lashes" kit. Therefore, the country of origin of the kit is the countries of origin of these components, i.e., Taiwan, Mexico and the U.S. However, since the components from the U.S. are not required to be marked under 19 U.S.C. 1304, the U.S. is not required to appear on the country of origin marking of the set.

Pursuant to 19 U.S.C. 1304(a)(3)(D) and section 134.32(d), Customs Regulations (19 CFR 134.32(d)), an exception from individual marking is applicable
where the marking of the container of an imported article will reasonably indicate the origin of the article. This exception is normally applied in cases where the imported article(s) is imported in a properly marked container and the ultimate purchaser in the U.S. will receive it in its original marked container. Accordingly, provided the purchaser at retail receives the "Hot Lashes" kit in the kit box properly marked with the countries of origin, 19 CFR 134.32(d) will be applicable and the individual items within the kit will not require country of origin marking.

D) Subheading 9802.00.50

Articles exported from and returned to the U.S., after having been advanced in value or improved in condition by repairs or alterations in Mexico, may qualify for a duty exemption under HTSUS subheading 9802.00.50, provided the foreign operation does not destroy the identity of the exported articles or create new or commercially different articles through a process of manufacture. See A.F. Burstrom v. United States, 44 CCPA 27, C.A.D. 631 (1956), aff'g C.D. 1752, 36 Cust. Ct. 46 (1956); Guardian Industries Corp. V. United States, 3 CIT 9 (1982). Articles are entitled to this duty exemption provided the documentary requirements of section 181.64, Customs Regulations (19 CFR 181.64) are met.

"Repairs or alterations" for purposes of 19 CFR 181.64 are defined as follows:

... restoration, addition, renovation, redyeing, cleaning, resterilizing, or other treatment which does not destroy the essential characteristics of, or create a new or commercially different good from, the good exported from the United States.

The "Hot Lashes" kit in the instant case does not qualify for the duty exemption under subheading 9802.00.50, HTSUS, as the components exported from the U.S. either lose their identity during the assembly process, or are subject only to packaging operations, and therefore do not undergo "repairs or alterations." However, pursuant to subheading 9801.00.10, HTSUS (which provides for duty free entry of U.S. goods exported and returned without having been advanced in value or improved in condition by any process of manufacture or other means while abroad), the U.S.-origin cosmetics merely packaged with the kit will be entitled to duty-free entry provided the documentary requirements of section 10.1, Customs Regulations (19 CFR 10.1) are met.

HOLDING:

Based on the information submitted:

1) The "Hot Lashes" curling system is properly classifiable under subheading 9615.90.20, HTSUS, the provision for "[C]ombs, hair-slides and the like; hairpins, curling pins, curling grips, hair-curlers and the like, other than those of heading 8516, and parts thereof; [o]ther: [n]onthermic, nonornamental devices for curling the hair." 2) The eyelash curler imported into Mexico from Taiwan is not transformed in Mexico into an originating good pursuant to General Note 12(b)(ii)(A), HTSUS. Therefore, the imported "Hot Lashes" system will not be eligible for preferential treatment under the NAFTA, when imported into the U.S.

3) Section 102.11(c) of the NAFTA Marking Rules (19 CFR 102.11(c)), is the applicable rule in the hierarchy that must be applied to determine the country (or countries) of origin of the imported set. Since the eye lash curler, heating unit, eye mascara and eyelash oil merit equal consideration in determining the essential character of the kit, the country of origin of the set is the countries of origin of these components, i.e., Taiwan, Mexico and the U.S. However, since the components from the U.S. are not covered by 19 U.S.C. 1304, only Taiwan and Mexico are required to appear on the country of origin marking of the set. The Customs Service, however, has no objection to the U.S. also appearing among the countries of origin identified on the set.

Provided the purchaser at retail receives the "Hot Lashes" kit in a box properly marked with the countries of origin, an exception to the individual marking requirements will be applicable and the individual items within the kit will not require country of origin marking. See 19 U.S.C. 1304(a)(3)(D) and 19 CFR 134.32(d)).

4) The "Hot Lashes" system does not qualify for the duty exemption under subheading 9802.00.50, HTSUS, as the components exported from the U.S. either lose their identity during the assembly process, or are subject only to packaging operations, and therefore do not undergo "repairs or alterations." However, pursuant to subheading 9801.00.10, HTSUS, the U.S.-origin cosmetics not advanced in value or improved in condition abroad and which undergo only packaging operations will
be entitled to duty-free entry provided the documentary requirements of section 10.1, Customs Regulations (19 CFR 10.1) are met.

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.

Sincerely,

John Durant,
Director
Tariff

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See also:

• Tariff No.: 9615.90.20 - Nonthermic, nonornamental devices for curling the hair
• Tariff No.: 9801.00.10 - U.S. goods returned without having been advanced in value or improved in condition while abroad
• Tariff No.: 9802.00.50 - Articles returned to the U.S. after having been exported for repairs or alterations, nesi