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HQ 561735




June 22, 2001

MAR-05 RR:CR:SM 561735 BLS

CATEGORY: MARKING

Ms. Theresa A. Gleason
Baker & McKenzie
815 Connecticut Avenue, N.W.
Washington, D.C. 20006-4078

RE: Country of origin marking of energy packs and heating/cooling pads; HRL 964054

Dear Ms. Gleason:

This is in reference to your letter dated May 3, 2000, on behalf of R.G. Barry Corporation, requesting a ruling concerning the classification and country of origin marking of certain non-electrical heating/cooling pad products consisting of an energy pack component with textile cover. In a letter dated March 2, 2001 (Headquarters Ruling Letter (HRL) 964054, enclosed), Customs issued a ruling on the classification of the imported products. We regret the delay in responding.

FACTS:

The heating products consist of a (1) textile cover and (2) a water-based energy pack. The energy pack consists of water and polyurethane foam sealed in a water–tight polyurethane film bag. It is designed to be heated in a microwave oven or placed in a refrigerator for a certain period of time. Thereafter, the energy pack will retain and radiate heat or cold for a number of hours. The energy pack is intended to be inserted into the textile cover and used principally in the home to provide soothing heat or cold, much in the same way a traditional heating pad, hot water bottle or ice pack is used.

R.G. Barry’s non-electrical heating/cooling pads come in a variety of shapes for use with different parts of the body, such as the neck, the back, and the elbow or knee joint. The names of the specific products RG Barry plans to import are: (1) Chest Cold Compress; (2) Sinus Relief Mask; (3) PMS Pillow; (4) Migraine and Headache Relief Band; (5) Muscle Pain Relief Pad; (6) Muscle Ache Relief Pillow; (7) Back Pain Relief Pad; (8) Arthritis Relief Mitt; and (9) Neck and Shoulder Stress Relief Pad. Each of these products is composed of a textile cover and one or more water-based energy packs.

The textile cover is assembled in Mexico or China from either Chinese formed and cut fabric or U.S. formed and cut fabric. The water based energy packs are made

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under patent in the U.S. from U.S. origin materials. The textile cover and energy packs are assembled in Mexico and then imported into the U.S.

ISSUE:

What are the marking requirements for the imported products?

LAW AND ANALYSIS:

The marking statute, section 304 of the Tariff Act of 1930, as amended (19 U.S.C. §1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. §1304.

The country of origin marking requirements for a “good of a NAFTA country” are also determined in accordance with Annex 311 of the NAFTA, as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057) (December 8, 1993) and the regulations set forth in 19 CFR Parts 102, 134.

Section 134.1(b) (19 CFR §134.1(b)) of the regulations defines “country of origin” as:

The country of manufacture, production, or growth of any article of foreign origin entering the U.S. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the “country of origin”; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin.

Section 134.1(j) provides that the “NAFTA Marking Rules” are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) defines a “good of a NAFTA country” as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules.

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Part 102 of the regulations (19 CFR Part 102), sets forth the “NAFTA Marking Rules” for purposes of determining whether a good is a good of a NAFTA country. Section 102.11 of the regulations (19 CFR §102.11) sets forth the required hierarchy for determining country of origin for marking purposes. Section 102.11(a) provides that “[t]he country of origin of a good is the country in which:

(1) The good is wholly obtained or produced; (2) The good is produced exclusively from domestic materials; or
(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section 102.20 and satisfies any other applicable requirements of that section, and all other requirements of these rules are satisfied.”

“Foreign Material” is defined in section 102.1(e) of the regulations as “a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced.”

Origin of Materials

Since the heating/cooling pad is neither wholly obtained or produced, nor produced exclusively from domestic (Mexican) materials, section 102.11(a)(3) is the applicable rule that must first be applied. In order to determine whether Mexico is the country of origin under this rule, we must look at those materials whose country of origin is other than Mexico, which includes material of U.S-origin (“Foreign Material” under 19 CFR §102.11(e)). Accordingly, we must first determine the origin of these materials, which comprise the heating/cooling pad, i.e., the textile cover and energy pack. For the textile cover, the rules of origin for textile and apparel products are applicable.

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 or after July 1, 1996. On September 5, 1995, Customs published section 102.21, Customs Regulations (19 CFR §102.21), 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.

Section 102.21(c)(1) (19 CFR §102.21(c)(1)) provides 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.” For purposes of this ruling, we will assume that none of the textile covers are “wholly obtained or produced”.

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Section 102.21(c)(2) (19 CFR §102.21(c)(2)) provides 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 the good underwent an applicable change in tariff classification, and/or met any other requirement, specified for the good in paragraph (e) of this section.”

It appears that the textile cover is classifiable under subheading 6307.90, HTSUS, “Other made up articles, including dress patterns:...Other.” (See HRL 957182 dated March 6, 1995, textile jackets for body pad/back warmer and pocket warmer). Section 102.21(e) (19 CFR §102.21(e)) provides 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:”

The country of origin of a good classifiable under subheading 6307.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.

Accordingly, the country of origin of the textile covers will be either the U.S. or China, depending upon where the fabric for a particular cover is formed. As noted above, the country of origin of the energy pack is the U.S.

Origin of Heating/Cooling Pad

As the heating/cooling pad is classified under subheading 3924.90.55, HTSUS (see HRL 964504), the change in tariff classification must be made in accordance with the applicable rule set forth in section 102.20(g), Customs Regulations (19 CFR §102.20(g)), Section VII: Chapters 39 through 40. This rule provides as follows:

A change to heading 3922 through 3926 from any other heading, including another heading within that group.

Upon exportation to Mexico, the U.S.-origin energy packs are also classified under HTSUS subheading 3924.90.55. See HRL 964054. As noted, the textile covers are classified under HTSUS subheading 6307.90.

As the energy pack does not undergo the applicable change in tariff classification set out in section 102.20(g), section 102.11(b) of the hierarchal rules must be applied next to determine the country of origin of the heating/cooling pad.

Section 102.11(b) of the regulations provides, in pertinent part, that where the country of origin cannot be determined under paragraph (a), the country of origin of the

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good is the country or countries of origin of the single material that imparts the essential character of the good. Section 102.18(b)(1) provides the following:

(1) For purposes of identifying the material that imparts the essential character to a good under § 102.11, the only materials that shall be taken into consideration are those domestic or foreign materials that are classified in a tariff provision from which a change in tariff classification is not allowed under the § 102.20 specific rule or other requirements applicable to the good. For purposes of this paragraph (b)(1):

(iii) If there is only one material that is classified in a tariff provision from which a change in tariff classification is not allowed under the § 102.20 specific rule or other requirements applicable to the good, then that material will represent the single material that imparts the essential character to the good under § 102.11.

In this case, the only material that does not undergo the applicable tariff shift is the energy pack. Therefore, as the U.S.-origin energy pack is the material that imparts the essential character to the good, the country of origin of the imported heating/cooling pad products is the U.S.

HOLDING:

Based on the information provided, the country of origin of the heating/cooling pad composed of the textile cover and energy pack is the U.S. Therefore, the imported articles are not subject to the marking requirements of 19 U.S.C. 1304.

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 handling the transaction.

Sincerely,

John Durant, Director

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