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HQ 960305





June 6, 1997

CLA-RR:TC:TE 960305 CAB

CATEGORY: CLASSIFICATION

Michael O'Neill
O'Neill & Whitaker, Inc.
1809 Baltimore Avenue
Kansas City, MO 64108

RE: Country of origin of a Portfolio; Section 102.21(c)(4)

Dear Mr. O'Neill:

This is in response to your inquiry of January 20, 1997, requesting a country of origin ruling for a certain binder, on behalf of Stuart Hall Company, Inc. A sample was submitted and will be returned under separate cover.

FACTS:

The article at issue which is a zippered binder is referred to as Product No. G68200. The binder is constructed of 420 denier crinkle nylon woven fabric on the exterior, 210 nylon woven fabric on the interior, and two pockets located both on the inside and outside of the binder, polypropylene woven piping which finishes the edges, plastic foam which is used as padding, and a textile fabric covered paperboard that is used as reinforcement. The sample measures approximately 13« inches x 11« inches. No paper inserts are included.

The exterior crinkle nylon fabric is woven in Taiwan and transported to China in uncut bolts of material. In China, the bolts of fabric are cut into the exterior cover component. All of the other textile components, the paperboard, and plastic foam are sourced in China and are cut, fashioned, glued, and sewn in China to produce the finished product. You state that the 420 crinkle nylon fabric from Taiwan comprises approximately 32 percent of the finished binder while the remainder of the textile fabric from China makes up approximately 68 percent of the finished article. While we disagree with the estimations due to your inclusion of the PVC foam, frame and other non textile components in the weights for the textile components, we do concur that the textile material and other non-textile goods from China predominate in weight when examining the binder in its entirety.

ISSUE:

What is the country of origin of the subject merchandise?

LAW AND ANALYSIS:

Pursuant to Section 334 of the Uruguay Round Agreements Act (codified at 19 USC Section 3592), new rules of origin were effective for textile products entered, or withdrawn from warehouse, for consumption on or after July 1, 1996. These rules were published in the Federal Register, 60 Fed. Reg. 46188 (September 5, 1995). Section 102.21, Customs Regulations (19 CFR Section 102.21), sets forth the general rules to determine country of origin. Thus, the country of origin of a textile product is determined by a hierarchy of rules set forth in paragraphs (c)(1) through (c)(5) of Section 102.21.

Section 102.21(c)(1) sets forth the general rule for determining the country of origin of a textile or apparel product in which the good was wholly obtained or produced. As the subject article has not been wholly obtained or produced in a single country, this section is inapplicable.

Section 102.21(c)(2) provides for instances where the country of origin of a textile or apparel product cannot be determined under Section 102.21(c)(1).

Section 102.21(c)(2) provides, in pertinent part:

Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) of this section, the country of origin of the good is the single country, territory, or insular possession in which each foreign material incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement, specified for the good in paragraph (e) of this section.

In order to determine the proper country of origin of the subject binder, Customs must first address the proper tariff classification of the article. The binder is potentially classifiable under three distinct headings, Heading 4202, of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), Heading 3926, HTSUSA, and Heading 6307, HTSUSA.

Heading 4202, HTSUSA, provides for, among other articles, trunks, suitcases, vanity cases, attache cases, briefcases, school satchels and similar containers. Customs has determined in prior cases that articles such as portfolio diaries, organizers, agendas, or planners without paper inserts are generally excluded from Heading 4202, HTSUSA, as they are not used in a manner similar to, nor do they possess physical characteristics of articles of that heading. Consequently, the subject binder is not properly classifiable under Heading 4202, HTSUSA.

Heading 3926, HTSUSA, provides for other articles of plastic, while Heading 6307, HTSUSA, provides for other made up textile articles. Because the binder at issue is composed of both textile materials and plastic, a question remains as to whether it is classifiable as a textile article under Heading 6307, HTSUSA, or as an article of plastic under Heading 3926, HTSUSA. Although no breakdown of the relative values have been provided concerning the textile portion and the plastic portion of the subject binder, given the fact that the textile fabric covers a predominate portion of the finished binder including the exterior portion and the textile portion provides the visual appeal of the binder, it is Customs opinion that the essential character of the binder is imparted by the textile part of the binder. Consequently, the subject binder is classifiable based on its textile fabric component and is classifiable under Heading 6307, HTSUSA. The binder is specifically classifiable in subheading 6307.90.9989.

Section 102.21(e) provides, in pertinent part:

Specific rules by tariff classification. The following rules shall apply for purposes of determining the country of origin of a textile or apparel product under paragraph (c)(2) of this section:

The country of origin of a good classifiable under subheading 6307.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.

Section 102.21(c)(2) is not applicable to the instant binder since it is comprised of fabrics formed in both Taiwan and China.

Section 102.21(c)(3) provides for instances when the country of origin determination cannot be made pursuant to paragraphs (c) (1) or (2) of Section 102.21. Section 102.21(c)(3) states the following, in pertinent part:

(i) If the good was knit to shape, the country of origin of the good is the single country, territory, or insular possession in which the good was knit; or

(ii) Except for goods of heading 5609, 5807, 6213, 6214, 6301 through 6306, and 6308, and subheading 6209.20.5040, 6307.10, 6307.90, and 9404.90, if the good was not knit to shape and the good was wholly assembled in a single country, territory, or insular possession, the country of origin of the good is the country, territory, or insular possession in which the good was wholly assembled.

Section 102.21(c)(3) is not applicable in this case since the subject merchandise is not knit to shape goods and subheading 6307.90, the applicable tariff classification subheading, is specifically excluded from the application of Section 102.21(c)(3) pursuant to provision (ii).

Section 102.21(c)(4) provides the first multi-country rule. Section 102.21(c)(4), states the following:

Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2) or (3) of this section, the country of origin of the good is the single
country, territory, or insular possession in which the most important assembly or manufacturing process occurred.

In this instance the subject binder is comprised of a textile fabric woven in Taiwan and a textile fabric woven in China along with other non-textile components from China. Customs believes that the manufacturing of the fabric is the most important manufacturing process in the production of the binder. In this case the textile fabrics comprising the binder are from both China and Taiwan, however, the manufacturing of the fabric in Taiwan is the most important processing operation. It is the fabric woven in Taiwan that predominately comprises the outer covering of the binder and also gives the binder its aesthetic appeal. Consequently, Taiwan is the country of origin of the subject binder in accordance with Section 102.21(c)(4).

HOLDING:

The country of origin of the subject binder is Taiwan in accordance with Section 102.21(c)(4).

The marking statute (19 USC ?1304) requires articles of foreign origin imported in the United States to be marked to indicate the name of the country of origin of the article. In the case of the subject binder, "Made in Taiwan", "Product of Taiwan", or "Taiwan" would be appropriate markings.

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 19 CFR 177.9(b)(1). This section states that the ruling letter is issued on the assumption that all of the information furnished in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.

Should it be subsequently 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, if there is any change in the facts submitted to Customs, it is recommended that a new ruling request be submitted in accordance with 19 CFR 177.2.

Sincerely,

John Durant, Director
Tariff Classification Appeals

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