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June 25, 1999

CLA-2-61:RR:NC:3:353 E83446

CATEGORY: CLASSIFICATION

TARIFF NO.: 6117.90.9090

Mr. Mike Leahy
A. N. Deringer Inc.
173 W. Service Road
Mt. Prospect, IL 60056

RE: The tariff classification, country of origin determination, 19 CFR 102.21(c)(2), status under the North American Free Trade Agreement (NAFTA) and Tariff Preference Levels (TPL) for a dress front panel.

Dear Mr. Leahy:

In your letter dated June 7, 1999, on behalf of Better Half Fashions, you requested a ruling regarding tariff classification, a country of origin determination, status under NAFTA and eligibility for TPL. The sample submitted with the ruling request will be returned to you.

FACTS:

The submitted sample is a dress front panel with spaghetti straps. It consists of knit 90% polyester/10% spandex stretch velvet fabric with spaghetti straps sewn to the top. It measures approximately 17 inches by 41 inches.

The fabric is made in Korea and shipped to Canada where it is cut to shape and assembled. The assembly in Canada consists of sewing the straps onto the panel. The dress front panel is then shipped to the United States where it will be beaded and eventually returned to Canada to be made into a finished dress.

CLASSIFICATION:

The applicable subheading for the dress front panel will be 6117.90.9090, Harmonized Tariff Schedule of the United States (HTS), which provides for “Other made up clothing accessories, knitted or crocheted; knitted or crocheted parts of garments or of clothing accessories: Parts: OtherÂOther: Of man-made fibers.” The general rate of duty will be 15% ad valorem. The textile category designation is 659.

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Section 334 of that Act (codified at 19 U.S.C. 3592) provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996.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.

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 of the foreign materials incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement.

Paragraph (e) in pertinent part 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:"

Copy the tariff shift rule for the applicable subheading: HTSUS Tariff shift and/or other requirements

6101 – 6117 (1) 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.

Under Section 102.21(b)(6), the term “wholly assembled” when used with reference to a good means that all components, of which there must be at least two, preexisted in essentially the same condition as found in the finished good and were combined to form the finished good in a single country, territory, or insular possession. Minor attachments and minor embellishments (for example, appliques, beads, spangles, embroidery, buttons) not appreciably affecting the identity of the good, and minor subassemblies (for example, collars, cuffs, plackets, pockets), will not affect the status of a good as “wholly assembled” in a single country, territory, or insular possession.

As the subject dress front panel is not knit to shape, consists of at least two component parts, the front panel and spaghetti straps, and is wholly assembled in a single country, that is, Canada, as per the terms of the tariff shift requirement, country of origin is conferred in Canada.

NAFTA:

Regarding the North American Free Trade Agreement (NAFTA), General Note (GN) 12(a)(i) states:
a) Goods originating in the territory of a party to the North American Free Trade Agreement (NAFTA) are subject to duty as provided herein. For the purposes of this note??

(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 set forth in regulations issued by the Secretary of the Treasury (without regard to whether the goods are marked), when such goods are imported into the customs territory of the United States 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, in accordance with section 201 of the North American Free Trade Agreement Implementation Act.

GN 12(b)(ii)(A) states in part:

(b) 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??

(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...

Accordingly the subject merchandise qualifies 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 the non-originating materials undergo a change in tariff classification as described in subdivision (t).

As the dress front panel is classified in heading 6117, HTSUS, GN 12(t)/61.39 applies, which states:

A change to headings 6113 through 6117 from any other chapter, except from headings 5106 through 5113, 5204 through 5212, 5307 through 5308 or 5310 through 5311, chapter 54, or heading 5508 through 5516 or 6001 through 6002, provided that the good is both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the NAFTA parties.

As the fabric from Korea is classified under heading 6001, which is an excepted heading, the dress front panel is not NAFTA eligible.

TPL:

Dress front panels are considered apparel goods and are thus eligible for consideration under Trade Preference Levels (TPL). Additional U.S. Note 3(a) applies, which 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 subdivisions (f) of this note, of apparel goods provided for in chapters 61 and 62 that are both cut (or knit to shape) and sewn or otherwise assembled in the territory of a NAFTA party from fabric or yarn produced or obtained outside the territory of one of the NAFTA parties.

The spaghetti straps are attached to the front panel in Canada. Therefore, the dress front panel has been cut to shape and been sewn or otherwise assembled in Canada. The dress front panel meets the requirements of Additional U.S. Note 3(a), and is eligible for tariff preference levels.

This ruling is being issued under the provisions of Parts 177 and 181 of the Customs Regulations (19 C.F.R. 177 and 181).

This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Kenneth Reidlinger at 212-637-7084.

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, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229.

Sincerely,

Robert B. Swierupski
Director,

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