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HQ 562120




January 31, 2002

MAR-2 RR:CR:SM 562120 KSG

CATEGORY: CLASSIFICATION

TARIFF NO.: 9820.11.09

B K Lee
Leeward International Inc.
21 West 38th Street
New York, NY 10018

RE: U.S.-Caribbean Basin Trade Partnership Act; subheading 9820.11.09

Dear Mr. Lee:

This is in response to your letter of May 8, 2001, requesting a binding ruling on the eligibility of garments made in Honduras for preferential tariff treatment under the United States-Caribbean Basin Trade Partnership Act (“CBTPA”).

FACTS:

You state that knitted fabric garments would be made in Honduras. The knitted fabric would be made in Honduras from yarn spun in Honduras.

ISSUE:

Whether the knitted garments described above, are eligible for preferential tariff treatment under the CBTPA.

LAW AND ANALYSIS:

Title II of the Trade and Development Act of 2000, (Pub. L. 106-200, 114 Stat. 251), concerns trade benefits for the Caribbean Basin and is referred to as the United States-Caribbean Basin Trade Partnership Act ("CBTPA"). Section 211 of the CBTPA amended section 213 (b) of the Caribbean Basin Economic Recovery Act (CBERA) (19 U.S.C. 2703(b)) to provide expanded trade benefits during a “transition period” to designated countries in the Caribbean Basin.

Section 211 of the CBTPA eliminates tariffs and quantitative restrictions on specific textile and apparel articles and extends North American Free Trade Agreement duty treatment standards to non-textile articles that previously were ineligible for preferential treatment under the CBERA. “Transition period” is defined in section 19 U.S.C. 2703(b)(5)(D) as meaning, with respect to a designated CBTPA country, the period that begins on October 1, 2000, and ends on the earlier of September 30, 2008, or the date on which a free trade agreement enters into force with respect to the U.S. and the CBTPA country.

Presidential Proclamation 7351, dated October 2, 2000, published in the Federal Register on October 4, 2000 (65 Fed. Reg. 59329), implemented the CBTPA by designating the eligible CBTPA countries and amending Chapter 98, HTSUS (including the creation of new subchapter XX) to facilitate the entry of the specific textile and apparel articles eligible for preferential treatment under the CBTPA.

The enhanced trade benefits provided by the CBTPA are available to eligible articles imported directly from a country: (1) that is designated as a CBTPA beneficiary country; and (2) which the U.S. Trade Representative (“USTR”) has determined has implemented and follows, or is making substantial progress toward implementing and following certain customs procedures that allow U.S. Customs to verify the origin of the articles.

In addition, Interim Customs Regulations to implement the trade benefit provisions of section 211 of the CBTPA were published in the Federal Register as T.D. 00-68 on October 5, 2000 (65 Fed. Reg. 59650). The T.D. invited public comments to be submitted on the Interim Regulations by December 4, 2000. It is noted that the issue raised in this ruling letter is outside the scope of the comments received.

Subheading 9820.11.09, HTSUS, provides as follows:

Apparel articles (other than socks provided for in heading 6115 of the tariff schedule) knit to shape in such a country from yarns wholly formed in the United States; knitted or crocheted apparel articles (except t-shirts, other than underwear, classifiable in subheading 6109.10.00 and 6109.90.10 and described in subheading 9820.11.12) cut and wholly assembled in one or more such countries from fabrics formed in one or more such countries or from fabrics formed in one or more such countries and the United States, all the foregoing from yarns wholly formed in the United States (including fabrics not formed from yarns, if such fabrics are classifiable in heading 5602 or 5603 of the tariff schedule and are formed in one or more such countries) and subject to the provisions of U.S. note 2(b) to this subchapter

Therefore, in order for knitted garments to be eligible for the CBTPA under this subheading, the yarns must be wholly formed in the United States. In this case, you have stated that the yarns are formed in Honduras. Accordingly, the knitted garments would not be eligible for preferential tariff treatment under the CBTPA.

HOLDING:

The knitted garments, manufactured as described above, would not be eligible for preferential tariff treatment under the CBTPA because the yarns are not wholly formed in the U.S.

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
Commercial Rulings Division

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