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HQ 961056




February 11, 1998

CLA-2 RR:CR:TE 961056 RH

CATEGORY: CLASSIFICATION

TARIFF NO.: 6307.90.9989; 7326.90.8585; 4202.92.3030

Edward L. Hart, Jr.
Import Manager
V. Alexander & Co., Inc.
P.O. Box 30250
Memphis, TN 38130-0250

RE: Classification of finished and partially finished golf bags; heading 4202; heading 6307; country of origin marking; 19 C.F.R ?102.21

Dear Mr. Hart:

This is in reply to your letter dated August 15, 1997, on behalf of Arnold Palmer Golf Company, requesting a ruling on the classification and marking of unfinished and partially unassembled golf bags.

You sent a sample of the golf bag components to aid us in our determination.

FACTS:

The merchandise at issue is a partially unassembled or unfinished vinyl and nylon golf bag (UPUGB, style 854), made up of a body sleeve, organizer top assembly, sling, top boot, clip, hoods, bottom boot and D-ring. These components will be produced in China and sent to the United States to be assembled with U.S.-origin components (plastic bottom, poly tube body liner, rivets and a metal D-clip) into a finished golf bag.

ISSUES:

What is the classification of the body sleeve and the remaining Chinese components when entered into the United States in the same shipment? What is the classification of these components when entered separately?

What are the marking requirements under both scenarios?

LAW AND ANALYSIS:

Classification of goods under the Harmonized Tariff Schedule of the U.S. Annotated (HTSUSA), is governed by the General Rules of Interpretation (GRIs). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes. Where goods cannot be classified solely on the basis of GRI 1, the remaining GRIs will be applied, in the order of their appearance.

Heading 4202, HTSUSA, provides in part for travel, sports and similar bags. The Explanatory Notes (EN) to heading 4202, at page 613, indicate that golf bags are regarded as sports bags for the purposes of that heading.

GRI 2(a) states that:

Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or falling [sic] to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled.

The first part of GRI 2(a) extends the scope of an article provision to cover not only the complete article, but also that article incomplete or unfinished, provided that, as presented, it has the essential character of the complete or finished article. See Explanatory Note (I) to GRI 2(a). The second part of the rule provides that an article presented unassembled is classified in the same heading as the assembled article. See Explanatory Note (V) to GRI 2(a). In addition, an unfinished article possessing the essential character of the finished article remains classifiable as the finished article when presented unassembled. See Explanatory Note (VI) to GRI 2(a).

In one of the scenarios you propose, the body sleeve and the remaining components are entered together. The imported body sleeve and other components are dedicated for use in, and possess the approximate shape or outline of, the finished golf bag. Moreover, we find that the imported components are indispensable to the structure of the final product and include the most important constituent materials in relation to the use of the goods. Thus, when presented together, the body sleeve and the remaining imported components are classified as an unfinished sports bag of heading 4202, HTSUSA.

In another scenario, the body sleeve and the remaining components are imported in separate shipments. In Headquarters Ruling Letter (HQ) 085391, dated December 20, 1989, we determined that a golf bag body did not possess the essential character of the finished article when imported individually. Accordingly, it was classified according to its constituent materials. Similarly, in HQ 959178, dated June 24, 1996, we held that a golf bag body imported separately from its remaining components was classifiable according to its constituent materials in heading 6307. As the instant body sleeve is substantially similar to the goods at issue in HQ 959178, we conclude that it is classifiable in heading 6307, HTSUSA, which is the residual provision for articles of textiles. In addition, we find that the remaining components, when imported without the body sleeve, do not possess the essential character of the finished article. Therefore, they shall also be classified according to their constituent materials. The organizer top assembly, sling, top boot, clip, hoods and bottom boot are classifiable under subheading 6307.90.9989, HTSUSA. The D-ring is classifiable under subheading 7326.90.8585, HTSUSA.

Country of Origin Marking

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. origin imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. Part 134, Customs Regulations (19 C.F.R. Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. ?1304.

Section 134.1(d), Customs Regulations (19 C.F.R. ?134.1(d)), provides that the "ultimate purchaser" is generally the last person in the U.S. who will receive the article in the form in which it was imported. If an imported article will be used in manufacture, the manufacturer may be the ultimate purchaser if he subjects the imported article to a process which results in a substantial transformation of the article. In that situation, the manufactured article, as a good of the U.S., is excepted from country of origin marking and only the outermost container of the imported article must be marked with the article's origin. See section 134.35(a), Customs Regulations (19 C.F.R.

Under the facts presented in your letter, China is the country of origin of all of the components entered into the United States as they are wholly produced in China (made in China from Chinese components). To determine whether the Chinese-origin golf bag components in the two scenarios in this case become goods of the U.S. when assembled to create finished golf bags, it is necessary to refer to the rules of origin for textile and apparel products set forth in section 102.21, Customs Regulations (19 C.F.R. ?102.21). Pursuant to the Uruguay Round Agreements Act, these new rules of origin (published in the Federal Register on September 5, 1995, 60 Fed. Reg. 46188) became effective for textile or apparel products entered, or withdrawn from warehouse for consumption, on or after July 1, 1996. The country of origin of a textile or apparel product is determined by a hierarchy of rules set forth in paragraphs (c)(1) through (c)(5) of section 102.21.

A "textile or apparel product" for purposes of these rules of origin is defined in 19 C.F.R. ?102.21(b)(5) as any good classifiable in Chapters 50 through 63, HTSUSA, as well as goods classifiable in certain additional provisions, including subheading 4202.92.30, HTSUSA. Therefore, the 19 C.F.R. ?102.21 rules of origin are applicable to the imported articles subject to this case.

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 is wholly obtained or produced in a single country, territory, or insular possession.

Section 102.21(c)(1) is not applicable because the subject merchandise is not wholly obtained or produced in a single country, territory, or insular possession. Accordingly, we turn to Section 102.21(c)(2) which provides that where the country of origin cannot be determined under paragraph (c)(1), the country of origin of the good is the single country 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 19 C.F.R. ?102.21(e). As discussed above, the finished golf bag under consideration here is classified in subheading 4202.92.3030, HTSUSA. Therefore, the applicable rule in 19 C.F.R ?102.21(e) is as follows:

4202.92.15 - 4202.92.30 A change to subheading 4202.92.15 through 4202.92.30 from any other heading, provided that the change is the result of the good being wholly assembled in a single country, territory or insular possession.

In this case, the requisite tariff shift is not met because the assembly of the golf bag takes place in more than a single country (i.e., in China and the United States). Accordingly, we continue in our hierarchical application of Section 102.21(c).

Section 102.21(c)(3) governs instances where country of origin of a textile or apparel product cannot be determined pursuant to paragraphs (c)(1) or (c)(2) and provides:

(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, 5811, 6213, 6214, 6301 through 6306, and 6308, and subheadings 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 inapplicable in this case because the subject merchandise is neither knit to shape nor wholly assembled in a single country.

Section 102.21(c)(4) provides "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 HQ 959179, we held that the country of origin of a golf bag was where the golf bag body (including the hardware and zippers) was assembled. In a second country, the bottom, top cuff and internal tube support were assembled to complete the golf bag. The assembly operations in this case are substantially similar to HQ 959179. In China, the body sleeve (including zippers and hardware) is assembled and shipped to the United States along with the organizer top assembly, sling, top boot, clip, hoods, bottom boot and D-ring. In the U.S., the plastic bottom, poly tube body liner, rivets and a metal D-clip are assembled with the imported components to complete the golf bag. Accordingly, as in HQ 959178, the most important assembly operation in this case transpires in China, where the majority of the golf bag body is assembled to completion. Accordingly, the origin of the completed golf bag under both scenarios is China, and it must be individually marked to so indicate to the ultimate purchaser.

You asked by telephone whether the imported golf bag components must be individually marked with their origin or whether the container in which they are imported may be marked with the components' origin. In this regard, section 134.32(d), Customs Regulations (19 C.F.R. ?134.32(d)), exempts from the marking requirements those articles for which the container will reasonably indicate the origin of the articles. Therefore, provided the Chinese-origin golf bag components are imported in properly marked containers and the certification set forth in section 134.26, Customs Regulations (19 C.F.R. ?134.26), is executed, the components are not required to be individually marked at the time of importation. However, the fully assembled golf bags must be individually marked to indicate` to the ultimate purchaser that their origin is China.

HOLDING:

The imported Chinese-origin body sleeve and remaining components, when presented together, are classifiable under subheading 4202.92.3030, HTSUSA, which provides for travel, sports and similar bags: with outer surface of textile materials: other, other: of man-made fibers: other. They are dutiable at the general column one rate at 19 percent ad valorem. The textile category is 670.

When imported separately, the Chinese-origin body sleeve, organizer top assembly, sling, top boot, clip, hoods and bottom boot are classifiable under subheading 6307.90.9989, HTSUSA, which provides for other made up articles, including dress patterns: other: other: other, other: other. The applicable rate of duty is 7 percent ad valorem. The D-ring is classifiable under subheading 7326.90.8585, HTSUSA, and is dutiable at the general one column rate of 3.5 percent ad valorem.

As determined under 19 C.F.R. ?102.21, the country of origin of the completed golf bag is China, and it must be marked accordingly.

The designated textile and apparel category may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected. Since part categories are the result of international bilateral agreements which are the subject of frequent negotiations and changes, to obtain the most current information available, we suggest that you check, close to the time of shipment, the Status Report on Current Import Quotas (Restraint Levels), an issuance of the U.S. Customs Service, which is updated weekly and is available at the local Customs office.

Due to the changeable nature of the statistical annotation (the ninth and tenth digits of the classification) and the restraint (quota/visa) categories, you should contact the local Customs office prior to importing the merchandise to determine the current status of any import restraints or requirements.

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 19 C.F.R. ?177.9(b)(1), which states that each ruling letter is issued on the assumption that all of the information furnished and incorporated 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. A change in the facts previously furnished may affect the determination of country of origin. Thus, if there is any change in the facts provided to Customs, it is recommended that a new ruling request be submitted in accordance with 19 C.F.R. ?177.2.

Sincerely,

John Durant, Director
Commercial Rulings Division

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