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NY E87227

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December 15, 1999

CLA-2-61:RR:NC:TA:356 E87227

CATEGORY: CLASSIFICATION

TARIFF NO.: 6105.10.0010; 9802.00.80; 9802.00.90

Ms. Paulette Crawford
Angelica Image Apparel Division
700 Rosedale
St. Louis, MO 63112

RE: The tariff classification of a men’s knit shirt from Nicaragua, Costa Rica and Mexico

Dear Ms. Crawford:

In your letter dated September 15, 1999, you requested a classification ruling. As requested, your sample will be returned.

The submitted garment is a men’s shirt constructed from 100 percent cotton, finely knit fabric which measures 12 stitches per linear centimeter counted in the horizontal direction and 15 stitches per linear centimeter counted in the vertical direction. The garment has a rib knit spread collar; a partial front opening with two button closures; short sleeves with rib knit cuffs; an embroidered emblem applied to the front panel; and a straight, hemmed bottom.

The applicable subheading for the shirt will be 6105.10.0010, Harmonized Tariff Schedule of the United States (HTS), which provides for men’s or boys’ shirts, knitted or crocheted, of cotton, men’s. The duty rate is 20.4 percent ad valorem. In 2000, the duty rate will be 20.2 percent ad valorem.

You ask about the applicability of partial duty exemption under 9802.00.80, HTS, for shirts assembled in Costa Rica and Nicaragua and 9802.00.90, HTS, for shirts assembled in Mexico and, specifically, whether the bonding of the emblem to the fully assembled shirts will constitute an acceptable assembly operation.

You state that knit fabric of U.S. origin will be cut to shape in the United States and fully assembled into knit shirts in Nicaragua, Costa Rica, or Mexico using buttons, a knit collar, and arm bands of U.S. origin and non-U.S. origin thread and twill tape.

The embroidered emblem is made in the United States of non-U.S. materials (embroidery thread, fabric backing, and adhesive). The emblem is produced by embroidering a piece of fabric using various colored threads and then cutting around the perimeter of the embroidery with a hot knife. A special adhesive is then applied to the back of the emblem. After the shirt is fully assembled, the embroidered emblem will be bonded to the shirt with controlled heat and platen pressure using heat-sealing equipment.

Subheading 9802.00.80, HTS, provides a partial duty exemption for:

“[a]rticles assembled abroad in whole or in part of fabricated components, the product of the United States, which (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, such as cleaning, lubricating, and painting.”

All three requirements of HTS subheading 9802.00.80 must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to duty upon the full cost or value of the imported assembled article, less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of section 10.24, Customs Regulations (19 C.F.R. 10.24).

Subheading 9802.00.90, HTS, provides for duty free entry of:

“Textile and apparel goods, assembled in Mexico in which all fabric components were wholly formed and cut in the United States, provided that such fabric components, in whole or in part, (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; provided the goods classifiable in chapters 61, 62, or 63 may have been subject to bleaching, garment dyeing, stone-washing, acid-washing or perma-pressing after assembly as provided for herein.”

For purposes of subheading 9802.00.80, Customs Directive number 3500-12 of September 2, 1986 provides as follows:

“[f]indings, trimmings, and elastic components of the finished assembled products need not be of United States origin. Products assembled in participating Caribbean countries and made of U.S. formed and cut fabric plus findings, trimmings, and elastic of foreign origin may enter the United States under the program. However, the total value of such foreign findings, trimmings, and elastic components shall not exceed 25 percent of the cost of the components of the assembled product. Products whose foreign findings, etc. exceed 25 percent do not qualify for the Program. Examples of findings and trimmings are sewing thread, hooks and eyes, snaps, buttons, “bow buds”, lace trim, zippers, including zipper tapes, and labels.”

Since subheading 9802.00.90, HTS, was specifically intended to extend duty free and quota free status to all goods assembled in Mexico, which previously were eligible for entry under the Special Regime Program administered under subheading 9802.00.8010, HTS, it is Customs view that all of the policy directives implementing this program should be applicable in the administration of subheading 9802.00.90, HTS.

In the present situation, the embroidered emblem is considered a “finding or trimming”, as the term is used for the purposes of this directive, because the emblem comprises a small portion of the completed garment and is not an essential part of the structure of the shirt.

Section 10.16(a), Customs Regulations (19 C.F.R. 10.16(a)), provides that the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, laminating, sewing, or the use of fasteners.

Since the embroidered emblems are separate, solid components which are permanently affixed in their entirety, by means of adhesives, heat and pressure, to other separate solid components (the garment panels), it is our opinion that this operation constitutes an acceptable assembly operation for purposes of subheadings 9802.00.80 and 9802.00.90, HTS.

Consequently, based upon the information submitted, the shirt, assembled in Costa Rica or Nicaragua from fabric components which are the product of the United States, meets the requirements of HTSUS subheading 9802.00.80, and is subject to duty upon the full cost or value of the imported assembled article, less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of Section 10.24, Customs Regulations (19 C.F.R. 10.24). Similarly, the shirt, assembled in Mexico from fabric components wholly formed and cut in the United States, will qualify for duty free treatment under 9802.00.90, HTS, provided the foreign origin components do not exceed 25 percent of the cost of the components of the garment, upon compliance with the documentary requirements.

The garment falls within textile category designation 338. Based upon international textile trade agreements, products of Nicaragua and Costa Rica are subject to quota and the requirement of a visa. As a product of Mexico, eligible for entry under 9802.00.90, HTS, the merchandise is not subject to visa requirements or quota restraints.

The designated textile and apparel categories and their quota and visa status are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information, we suggest that you check, close to the time of shipment, the U.S. Customs Service Textile Status Report, an internal issuance of the U.S. Customs Service, which is available at the Customs Web site at www.customs.gov. In addition, the designated textile and apparel categories may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected and should also be verified at the time of shipment.

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

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 Mary Ryan at 212-637-7081.

Sincerely,

Robert B. Swierupski
Director,

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See also:

• Tariff No.: 6105.10.00 - Men's or boys' shirts, knitted or crocheted, of cotton
• 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.