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NY 816187

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Nov. 14, 1995

CLA-2-62:R:N5:816187 361

CATEGORY: CLASSIFICATION

TARIFF NO.: 6204.62.4010

Mr. Jeff Whiting
Denim Apparel Services
3330 West Friendly Avenue
P.O. Box 21207
Greensboro, NC 27240

RE: The status under the North American Free Trade Agreement (NAFTA), of a pair of woman's denim trousers (jeans) assembled in Mexico from parts cut in the United States.

Dear Mr. Whiting:

In your letter dated June 12, 1995, and follow up dated October 20, 1995, you requested a ruling on the status under the North American Free Trade Agreement (NAFTA), of a pair of woman's denim trousers (jeans) from Mexico. In our telephone conversation of November 8, 1995, it was discussed that a classification decision could not be made without a sample of the garment. The other information your requested, however, is provided herewith, and is based on the assumption that the classification of the garment is as a pair of women's cotton denim pants.

In your request, you indicated that 100% cotton denim fabric will be imported from Greece into the United States. The fabric will be cut in the U.S. into the component parts for jeans. The components will then be sent to Mexico where they will be assembled, then stone washed, pressed, tagged, boxed, and shipped back to the United States.

In your request you asked whether the garments will be eligible for 9802.00.80; what duty will be appropriate, if any; what portion of the value of the goods will be subject to duty; and whether quota restraints are in effect for these goods.

Assuming that these garments are women's cotton denim trousers, the applicable tariff provision will be 6204.62.4010, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for women's trousers, of cotton fabric. The general rate of duty will be 17.6 percent ad valorem.

Assuming that these garments would be classified as women's cotton woven denim trousers, they would fall within textile category designation 348. Based upon international textile trade agreements, category 348 garments from Mexico are subject to quota restraints and a visa requirement, unless they qualify as originating under the NAFTA, or under Mexican Special Regime.

The garment does not qualify for preferential treatment under the NAFTA because materials used in the production of the goods (fabric imported from Greece) will not undergo the change in tariff classification required by General Note 12(t)/62.28, HTSUSA. The garments will not qualify for Mexican Special Regime, (9802.00.90) since that provision requires the fabric to be formed (i.e. woven) in the United States.

You also asked whether the garments in question would qualify for a partial duty exemption under 9802.00.80. Garments qualifying under that HTS number must fulfill all of the following requirements:

(a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process

Stone washing after assembly is considered to be an operation that advances the value, and therefore, the garments would not qualify for a reduced rate under HTS 9802.00.80. They would be dutiable upon the full appraised value of the garments.

These garments may, however, qualify for a preferential duty rate under the Tariff Preference Levels (TPL) defined in the HTSUSA, section XI, additional U.S. note 3(b). Since the garments are cut in the United States and sewn in Mexico, they would qualify for the reduced rate up to the quantity specified in note 3(g) provided that the imported merchandise is accompanied by a Certificate of Eligibility, and the garments are not made from one of the excluded fabrics (such as blue denim) listed in note 3(d). Garments that qualify for preferential duty rate under the TPL may still be subject to quota requirements.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).

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

Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Office of Regulations and Rulings, U.S. Customs Service, 1301 Constitution Ave. N.W., Franklin Court, Washington, D.C. 20229.

Sincerely,

Roger J. Silvestri
Director

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See also:

• Tariff No.: 6204.62.40 - Women's or girls' trousers, breeches and shorts, not knitted or crocheted, of cotton, nesoi
• Tariff No.: 9802.00.80 - U.S. articles assembled abroad, which have not lost their physical identity or have not advanced in value or improved in condition abroad
• Tariff No.: 9802.00.90 - Textile and apparel goods, assembled in Mexico in which all fabric components were wholly formed and cut in the United States, etc.