HQ 960516 - Country of origin determination for woman's knit cardigan; 19 C.F.R. ?102.21(c)(3); shaped panels; clear cutting lines; knit to shape - United States International Trade Commision Rulings

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HQ 960516

July 14, 1998

CLA-2 RR:CR:TE 960516 SG

CATEGORY: CLASSIFICATION

Thomas Travis, Esq.
Sandler, Travis & Rosenberg, P.A.
5200 Blue Lagoon Drive
Miami, Florida 33126-2022

RE: Country of origin determination for woman's knit cardigan; 19 C.F.R. ?102.21(c)(3); shaped panels; clear cutting lines; knit to shape

Dear Mr. Travis:

This is in reply to your letter dated January 7, 1998, following up on the resubmitted request by your client, Charming Shoppes, Inc. (Charming), dated March 25, 1997, for a country of origin determination on a woman's knit garment which will be imported into the United States. Samples of the garment's component pieces, before assembly, and a finished garment were submitted to this office for examination.

FACTS:

The finished merchandise, is a woman's knit cardigan made of 100 percent acrylic fabric, featuring long sleeves, a round neckline and a full front, buttoned opening that closes right over left. There are nine fabric covered buttons and woven fabric capping around the neckline and down the front placket. The sleeves and bottom of the garment are not hemmed, merely stitched to appear as if hemmed. The jersey knit fabric of the garment has more than nine stitches per two centimeters measured in the horizontal direction. The cardigan is intended for wear on the upper part of the torso, extending from the wearer's neck and shoulders to the hips. Also submitted was a sample of the right and left sleeve, front and back panels as they appear prior to being sent to China for linking and looping.

As per the letter from Charming, the manufacturing operations for the subject garment are as follows:

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Hong Kong
1. Right and left sleeve, front and back panels are knit to shape

2. Marker lines for linking are formed

China
3. Cutting of front panel into separate right and left panels

4. Linking and stitching. Front and back panels are linked according to the marker lines at the shoulder and side seams to form the body. The sleeves are center seam stitched, linked and full-fashion stitched to the body

5. Stitching and finishing tape around the right and left front panels

6. Hemming of bottom

7. Making button holes and attaching buttons

8. Pressing.

Hong Kong
9. Label sewing and packaging.

ISSUE: What is the country of origin of the subject merchandise?

LAW AND ANALYSIS:

On December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act (codified at 19 U.S.C. ?3592) provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. On
September 5, 1995, Customs published Section 102.21, Customs Regulations, in the Federal Register, implementing Section 334 (60 FR 46188). Thus, effective July 1, 1996, the country of origin of a textile or apparel product shall be determined by sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.

Paragraph (c)(1) states that "The country of origin of a textile or apparel product is the single country, territory, or insular possession in which the good was wholly obtained or produced." As the subject merchandise is not wholly obtained or produced in a single country, territory or insular possession, paragraph (c)(1) of Section 102.21 is inapplicable.

Paragraph (c)(2) states that "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

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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".

Paragraph (e) states that "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:"

6101-6117 If the good is not knit to shape and consists of two or more component parts, a change to an assembled good of heading 6101 through 6117 from unassembled components, provided that the change is the result of the good being wholly assembled in a single country, territory or insular possession.

If the good is knit to shape, a change to heading 6101 through 6117 from any heading outside that group, provided that the knit-to- shape components are knit in a single country, territory or insular possession.

Section 102.21(b) states:

(3) Knit to shape. The term knit to shape applies to any good of which 50 percent or more of the exterior surface area is formed by major parts that have been knitted or crocheted directly to the shape used in the good, with no consideration being given to patch pockets, appliques, or the like. Minor cutting, trimming, or sewing of those major parts will not affect the determination of whether a good is "knit to shape".

(4) Major parts. The term major parts means integral components of a good but does not include collars, cuffs, waistbands, plackets, pockets, linings, paddings, trim, accessories, or similar parts.

In the case of the subject knit sweater you state that all of the panels are knit to shape. We agree that the sleeve panels are full fashioned or knit to shape.

An examination of the front panel reveals that at the top of the panel, in a semi-circular formation, the knit fabric changes from a two by two rib which comprises the rest of the panel, to a two by one rib (in a ladder effect). This ladder effect (changed pattern) is continuous, with clear starting and ending points, and is spaced no more than one inch apart. It therefore, serves as a clear unambiguous line of demarcation (cutting line); that is, where the semi-circular shape is to be cut out, resulting in a round neckline. The front panel also has lines of demarcation indicating where it is to be cut into two front panels. The front panel's armholes have been fashioned or shaped during the knitting process. The front panel also has two very small holes at each side, which are marker lines. We understand that the front and back panels are linked according to the marker lines at the shoulder and side seams to form the body.
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It is our view that the change in pattern which is knit directly into the fabric, is continuous, has clear starting and ending points, and serves as a clear and unambiguous line of demarcation. It is this line of demarcation which sufficiently identifies the neck contour of the panel. As such it dedicates the shape of the neckline. Inasmuch as the shape of the neckline is clearly dedicated and the armholes are full-fashioned or shaped in the knitting process, the cutting involved, which merely separates the shaped neckline, is minor. Accordingly, the neckline of the garment is shaped by clear lines of demarcation. Where, as in the panel we are examining, either the neckline and the armholes are shaped directly during the knitting process or by clear lines of demarcation, the panel is, in our view, knit to shape.

The back panel has armholes that have been shaped or fashioned during the knitting process. The back panel also has two very small holes at each side, which are marker lines. At the top of the panel, at approximately two inches both right and left of the center of the panel, the knit fabric changes from a two by two rib which comprises the rest of the panel, to a two by one rib (in a ladder effect). This ladder effect (changed pattern) is spaced approximately one half an inch apart and continues for approximately one and one half inches. It is neither continuous nor does it have clear starting and ending points. As a result, it does not serve as a clear unambiguous line of demarcation. It is therefore, the cutting rather than the change in pattern, which determines the neck contour of the back panel. It, therefore, does not have a shaped neckline. However, inasmuch as the armholes are shaped, the fact that the neckline is not, and requires some cutting which we believe to be minor when considering the panel as a whole, will not prevent the panel itself from being considered to be knit to shape.

Inasmuch as the front and back panels and sleeves of the sweater under consideration are considered to be knit to shape, the finished cardigan qualifies as a knit to shape good.

Section 102.21(e) requires a tariff shift to headings 6101 through 6117 from any heading outside the specified headings, if the good is knit to shape. In this case, the tariff shift occurred from components classifiable in heading 6117. As heading 6117 is excepted by section 102.21(c)(2), the tariff shift was not applicable. We must then look to section (c)(3) which provides that where the country of origin cannot be determined under paragraph (c)(1) or (2) of this section: (i) If the good was knit to shape the country of origin is the single country, territory, or insular possession in which the good was knit. In the case of the subject cardigan, inasmuch as all the sweater components are knit in a single country (Hong Kong), it is Hong Kong which is the, the country of origin of this cardigan.

HOLDING:

The country of origin of the subject women's knit cardigan is Hong Kong.

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 C.F.R. on the assumption that all of the information 5
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 C.F.R. 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 C.F.R. ?177.2.

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.

In order to ensure uniformity in Customs' classification of knit to shape merchandise and to eliminate uncertainty, pursuant to section 177.9(d)(1), Customs Regulations (19 CFR 177.9(d)(1), inconsistent rulings will be revisited and if necessary clarified to reflect this determination.

Sincerely,

John Durant, Director
Commercial Rulings Division

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