United States International Trade Commision Rulings And Harmonized Tariff Schedule

faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers

faqs.org > Rulings and Tariffs Home > Rulings By Number > 1998 HQ Rulings > HQ 961992 - HQ 962381 > HQ 962122

Previous Ruling Next Ruling
HQ 962122

---

October 1, 1998
CLA-2 RR:CR:TE 962122 jb

CATEGORY: CLASSIFICATION

TARIFF NO.: 9404.90.2000

Alastair Moran
Livingston Trade Services
405 The West Mall
Toronto, Ontario
CANADA M9C 5K7

RE: Classification of cushions; eligibility under the North American Free Trade Agreement (NAFTA) and Tariff Preference Levels (TPL); country of origin

Dear Mr. Moran:

This is in response to your letter, dated May 7, 1998, on behalf of your client, Sure Fit Home Furnishings Ltd., requesting classification under the Harmonized Tariff Schedule of the United States (HTSUS), and country of origin determinations for certain curtains, valances and cushions. You also request whether the merchandise is eligible for treatment under the North American Free Trade Agreement (NAFTA) or for consideration under the Tariff Preference Levels (TPL).

Our New York office issued to you NY C89713, dated August 3, 1998, wherein the classification, origin, NAFTA and TPL eligibility for the curtains and valances was addressed. As such, this letter will only address the remaining merchandise, that is, the cushions.

FACTS:

You state in your letter that the cushions will be made from a 50 percent polyester/50 percent cotton plain woven printed fabric. Once the fabric for the outershell is imported into Canada, the fabric will be cut into the following sizes: 15 inches by 15 inches, 16 inches by 16 inches, 19 inches by 19 inches, and 20 inches by 20 inches. The fabric weighs approximately 101 grams per square meter and the cushions will be stuffed with either a blend of 50 percent cotton, 40 percent polyester and 10 percent other fibers, or a mostly polyester fill (we note that in your letter you only account for 80 percent of the polyester material and no indication is given as to the composition of the remaining 20 percent).

The manufacturing operations are as follows:

Scenario I

Pakistan
50 percent polyester/50 percent cotton shell fabric is woven and printed

Taiwan chief weight polyester filling material is made

Canada fabrics are cut, sewn and assembled into cushions

Scenario II

Pakistan
50 percent polyester/50 percent cotton shell fabric is woven and printed

Canada
50 percent cotton, 40 percent polyester and 10 percent other filling material is made fabrics are cut, sewn and assembled into cushions

ISSUE:

1. What is the proper classification for the subject merchandise?

2. What is the country of origin of the subject merchandise?

3. Does the merchandise qualify for NAFTA?

4. Does the merchandise qualify for consideration under the Tariff Preference Levels?

LAW AND ANALYSIS:

Classification

Classification of merchandise under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is in accordance with the General Rules of Interpretation. GRI 1 requires that classification 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 GRI will be applied, in the order of their appearance.

Heading 9404, HTSUS, provides for, among other things, articles of bedding and similar furnishings. Although size specifications are not explicitly outlined in the terms of heading 9404, HTSUS, Customs has held that so long as pillows/cushions are sufficient in size and stuffing to be capable of providing support, classification in heading 9404, HTSUS, is appropriate. Accordingly, it is the opinion of this office that the subject cushions are adequate in size to provide support and thus, are properly classified in heading 9404, HTSUS.

As the subject cushions are composed of a mixture of textile materials, that is, a woven outershell fabric consisting of a blend of 50 percent polyester and 50 percent cotton, and textile fiberfill, we look to Additional U.S. Rule of Interpretation 1(d), which states:
the principles of section XI regarding mixtures of two or more textile materials shall apply to the classification of goods in any provision in which a textile material is named.

Subheading Note 2 to Section XI, HTSUSA, states:

(A) Products of chapters 56 to 63 containing two or more textile materials are to be regarded as consisting wholly of that textile material which would be selected under note 2 to this section for the classification of a product of chapters 50 to 55 consisting of the same textile materials.

(B) For the application of this rule:

(a) Where appropriate, only the part which determines the classification under general interpretative rule 3 shall be taken into account;

Note 2 to Section XI, HTSUSA, states:

(A) Goods classifiable in chapters 50 to 55 or in heading 5809 or 5902 and of a mixture of two or more textile materials are to be classified as if consisting wholly of that one textile material which predominates by weight over each other single textile material.

When no one textile material predominates by weight, the goods are to be classified as if consisting wholly of that one textile material which is covered by the heading which occurs last in numerical order among those which equally merit consideration.

In the case of the subject merchandise, for purposes of classification, the printed outershell fabric is the component that provides the essential character to the cushions. If the outershell fabric of the subject merchandise were composed of either cotton or polyester, the applicable provisions would be subheadings 9404.90.1000 (cotton) or 9404.90.2000 (other). However, as the subject merchandise is composed of a blend of 50 percent cotton and 50 percent polyester fabric, as per the above referenced notes, no one textile material predominates by weight, and the cushions are classified in subheading 9404.90.2000, HTSUSA, based on the heading which occurs last in numerical order, in this case, "other".

We would like to note however, that the classification determination rendered is based on the fiber content you have submitted to us, that is, a precise parity in the cotton and polyester blend of the fabric. Even a slight change in the fiber content may result in a change in the classification and the applicable quota/visa restrictions. As such, Customs may subject the cushions to laboratory analysis at the time of importation. In that respect, we advise you to inform Customs of any changes in the fabric composition of the subject merchandise or risk reclassification by Customs.

North American Free Trade Agreement Eligibility

The subject cushions undergo processing operations in Canada which is a country provided for under the North American Free Trade Agreement (NAFTA). General Note 12, HTSUSA, incorporates Article 401 of the North American Free Trade Agreement (NAFTA) into the HTSUSA. Note 12(a) provides, in pertinent part:

(i) Goods that originate in the territory of a NAFTA party under the terms of subdivision (b) of this note and that qualify to be marked as goods of Canada under the terms of the marking rules... and are entered under a subheading for which a rate of duty appears in the "Special" subcolumn followed by the symbol "CA" in parentheses, are eligible for such duty rate... . [Emphasis added]

Accordingly, the cushions at issue will be eligible for the "Special" "CA" rate of duty provided they are NAFTA "originating" goods under General Note 12(b), Harmonized Tariff Schedule of the Unites States Annotated (HTSUSA), and they qualify to be marked as goods of Canada. Note 12(b) provides, in pertinent part,

For 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) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or

(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or

Accordingly, the subject cushions qualify for NAFTA treatment only if the provisions of General Note 12(b)(ii)(A) are met, that is, if the merchandise is transformed in the territory of Canada so that the non-originating material (the fabrics formed in Pakistan, and in the case of scenario I, the filling made in Taiwan) undergo a change in tariff classification as described in subdivision (t).

As the cushions are classifiable in subheading 9404.90.2000, HTSUSA, subdivision (t), Chapter 94, rule 7, applies. That note states:

A change to subheading 9404.90 from any other chapter, except from headings 5007, 5111 through 5113, 5208 through 5212, 5309 through 5311, 5407 through 5408 or 5512 through 5516.

When the fabric for the subject cushions leaves Pakistan it falls within headings 5512 through 5516, HTSUS. As headings 5512 through 5516 are excepted by subdivision (t), chapter 94, rule 7, the fabric does not meet the terms of the note. Accordingly, the subject merchandise is not eligible for NAFTA treatment.

In your letter you refer to HQ 959834, dated October 9, 1996, wherein pillows which were manufactured in Canada (through the operations of stuffing the pillow and comforter shells with the polyester filling and sewing the fourth side to form the completed pillows and comforters) from poly/cotton shells produced in Pakistan were determined to qualify for the NAFTA based on the appropriate tariff shift. You inquire whether this ruling "still stands" and if rather than importing the fabric in bulk, cushion shells are imported into Canada, will this result in a different determination? In answer to your question, HQ 959834 has neither been modified nor revoked and thus is still representative of Customs position with respect to the facts and merchandise stated in that ruling. In that respect, if the subject cushions are similarly manufactured, such that cushion shells (classifiable in heading 6307) are imported into Canada, heading 6307 is not excepted by subdivision (t), and thus the merchandise would undergo the requisite change in tariff, qualifying the merchandise for the NAFTA preference.

Tariff Preference Levels

Additional U.S. Note 4(a) states:

The rate of duty in the "Special" subcolumn of rates of duty column 1 followed by the symbol "CA" in parentheses shall apply to imports from Canada, up to the annual quantities specified in subdivision (c) of this note, of cotton or man-made fiber fabric and cotton or man-made fiber made-up textile goods provided for in chapters 52 through 55 (excluding goods containing 36 percent or more by weight of wool or fine animal hair), 58, 60 and 63, that are woven or knit in the territory of a NAFTA party from yarn produced or obtained outside the territory of one of the NAFTA parties, or knit in the territory of a NAFTA party from yarn spun in the territory of a NAFTA party from fiber produced or obtained outside the territory of one of the NAFTA parties, and to goods of subheading 9404.90 that are finished and cut and sewn or otherwise assembled from fabrics of subheadings 5208.11 through 5208.29, 5209.11 through 5209.29, 5210.11 through 5210.29, 5211.11 through 5211.29, 5212.11, 5212.12, 5212.21, 5212.22, 5407.41, 5407.51, 5407.71, 5407.81, 5407.91, 5408.21, 5408.31, 5512.11, 5512.21, 5512.91, 5513.11 through 5513.19, 5514.11 through 5514.19, 5516.11, 5516.21, 5516.31, 5516.41 or 5516.91 produced or obtained outside the territory of one of the NAFTA parties.

As per the terms of Additional U.S. Note 4(a), the subject cushions, which are made of a printed fabric (subheading 5513.41, HTSUS) not classifiable under any of the listed subheadings, are not eligible for the tariff preference levels.

Country of Origin

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.

In your letter you state that "the cushions, because they are classified in HTSUS 9404.90.20, are not " textile products" as that term is defined in 19 CFR 102.21(b)(5), and thus are subject to different rules for determining the country of origin." You are correct in stating that as written the listed headings and subheadings under 19 CFR 102.21(b)(5), fail to include subheading 9404.90.20, HTSUS, for purposes of the section 102.21 rules of origin. However, it is Customs position that the omission of subheading 9404.90.20, HTSUS, was an oversight. In that respect we direct your attention to the statute pertaining to the rules of origin, 19 U.S.C. section 3592, which states explicitly under (b)(2), Special rules, that:

(A) the origin of a good that is classified under one of the following HTS headings or subheadings shall be determined under subparagraph (A), (B), or (C) of paragraph (1), as appropriate: 5609, 5807, 5811, 6209.20.50.40, 6213, 6214, 6301, 6302, 6303, 6304, 6305, 6306, 6307.10, 6307.90, 6308, or 9404.90; and (Emphasis added)

As the statute does not break out subheading 9404.90, HTSUS, it is Customs position that the statute takes precedence over the regulation. That is to say, Customs cannot exclude by regulation what is specifically included by statute. Accordingly, in determining the origin of the subject cushions, the 102.21 rules of origin are applicable.

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 the 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."

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:"

9404.90 The country of origin of a good classifiable under subheading 9404.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.

The subject cushions are classified in subheading 9404.90, (HTSUS). In the scenarios you describe in your letter, as the cushions consist of fabric sourced in a single country, Pakistan, the country of origin of the subject merchandise is Pakistan.

HOLDING:

The subject cushions are classified in subheading 9404.90.2000, HTSUSA, which provides for: "[m]attress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with springs or stuffed or internally fitted with any material or of cellular rubber or plastics, whether or not covered: other: pillows, cushions and similar furnishings: other." The applicable rate of duty is 6 percent ad valorem.

The subject merchandise is not eligible for NAFTA treatment and does not qualify for a TPL.

The country of origin for the subject merchandise is Pakistan.

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 subject to 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 section 19 CFR 177.9(b)(1). This section states that a 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
Commercial Rulings Division

Previous Ruling Next Ruling

See also:

• Tariff No.: 6209.20.50 - Babies' garments & clothing acc. nesoi, of cotton, incl. sunsuits & sim app, sets & parts of sets, & diapers, not knitted or crocheted
• Tariff No.: 9404.90.10 - Pillows, cushions and similar furnishings, of cotton
• Tariff No.: 9404.90.20 - Pillows, cushions and similar furnishings, other than of cotton