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HQ 965005

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July 9, 2002

CLA-2 RR:CR:TE 965005 mbg

CATEGORY: CLASSIFICATION

TARIFF NO.: 6203.11.9000

Paul H. Lippe
Vital International Freight Services, Inc. P.O. Box 452780
Los Angeles, CA 90045-2780

RE: U.S.-Caribbean Basin Trade Partnership Act; men’s suits

Dear Mr. Lippe:

This is in response to your letter dated March 19, 2001, on behalf of your client, Neema Clothing, Inc., requesting a binding ruling on the eligibility of men’s suits for preferential tariff treatment under the United States-Caribbean Basin Trade Partnership Act (“CBTPA”). You submitted two samples for our examination.

FACTS:

You have submitted two men’s suits for our consideration . Each suit is composed of a four panel suit jacket and matching trousers. You have provided that both suits will be manufactured in the Dominican Republic. The fabric is shipped to the Dominican Republic where it is then cut and assembled into the subject merchandise using sewing thread formed in Korea.

The first sample is identified as Lot 6006, and also as item 2018 Dancotex, and is manufactured from fabric woven in either Korea or Uruguay. The average micron fiber diameter measures 22.5 microns. The outer shell of the subject suit is made of 100 percent woven wool fabric manufactured in Uruguay. The inside lining of the jacket is composed of man-made fibers and is manufactured in Korea. The submitted matching trousers for Lot 6006 do not have a lining but we note that the documents submitted provide that a lining will be manufactured in Korea.

The second sample is identified as Lot 6001, and also as item 2020 Burlington, and is manufactured of fabric wholly formed in the United States from yarns wholly formed in the United States. The average fiber diameter measures 20.5 to 21.5 microns. The outer shell of the subject suit jacket is made of 100 percent woven wool fabric manufactured in the United States. The inside lining of the jacket is composed of man-made fibers and is manufactured in the United States. The chest piece and sleeve head are manufactured in Canada and Korea. The submitted matching trousers for Lot 6001 do not have a lining but we note that the documents submitted provide that a lining will be manufactured in Korea. The documents also provide that the outer shell of the pants for Lot 6001 will be manufactured in Uruguay.

The men’s suits are properly classified in subheading 6203.11.9000, HTSUSA, which provides for “Men’s or boys’ suits, ensembles, suit-type jackets, blazers, trousers, bib and brace overalls, breeches and shorts (other than swimwear): Suits: Of fine wool or animal hair: Other: Other. “ The general column one rate of duty is 10.6 cents per kilogram plus 18.2 percent ad valorem. The textile category number is 443.

ISSUE:

Whether the subject merchandise is 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 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. Dominican Republic is designated as a CBTPA beneficiary country (see Presidential Proclamation 7351, dated October 2, 2000, 65 Fed. Reg. 59329) and has satisfied the second criterion (see 65 Fed. Reg. 60236, dated October 10, 2000).

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.

Certain textile articles are designated eligible for preferential tariff treatment within subheading 9820.11.06, HTSUSA, as provided for in Subchapter XX, U.S. Note 2(a), HTSUSA, which provides:

Except as provided in this note, textile and apparel articles described in subheadings 9820.11.03 through 9820.11.30, inclusive, of this subchapter that are imported directly into the customs territory of the United States from a designated beneficiary CBTPA country enumerated in general note 17(a) to the tariff schedule shall be eligible to enter free of duty and free of any quantitative limitations, except as provided in this subchapter, under the terms of the provisions set forth in such subheadings and applicable legal notes, as indicated by the rate of duty of “Free” in the Special rates of duty subcolumn for such provisions.

The CBTPA was developed to aid the countries of the Caribbean region and to facilitate trade between these countries and the United States. The aim was to allow for the use of fabric made in either the Caribbean or the United States. Therefore, the manufacturing scenario that you have presented for the sample identified as Lot 6006, and also identified as item 2018 Dancotex, which is manufactured from fabric woven in Korea and Uruguay will not be eligible for preferential treatment under the CBTPA.

The relevant apparel provision for the second scenario, identified as Lot 6001, and also identified as item 2020 Burlington, in which the jacket is manufactured of fabric wholly formed in the United States from yarns wholly formed in the United States, is set forth in 9820.11.06, HTSUSA, which provides that preferential treatment shall apply to:

Apparel articles cut in one or more such countries from fabric wholly formed in the United States from yarns wholly formed in the United States (including fabrics not formed from yarns, if such fabrics are classifiable under heading 5602 or 5603 and are wholly formed in the United States), if such articles are assembled in one or more such countries with thread formed in the United States.

In regard to the facts of this case, the woolen outer shell of the subject men’s jacket which is said to be cut and assembled in the Dominican Republic from fabrics produced in the United States from yarns produced in the United States would appear to meet the requirements for preferential treatment under the CBTPA. However, subheading 9820.11.06, HTSUSA, also requires the use of sewing thread formed in the United States and since the subject sample is assembled with sewing thread formed in Korea, the garment would not be eligible for preferential treatment. In addition, the classification under the HTSUSA for men's suits is based upon the classification of both a jacket and pants. The pants submitted as part of the suit for Lot 6001 are not manufactured of fabric formed in the United States or any CBTPA beneficiary country. Since the pants are ineligible for preferential treatment under the CBTPA, the subject men’s suit would also be ineligible for preferential treatment under the CBTPA.

Furthermore, for your informational purposes, the men’s jacket also contains an inner lining manufactured of man-made fibers in either the United States from U.S. fibers and yarns or in Korea from foreign fibers and yarns. There are two provisions that are applicable to certain interlinings of foreign origin; U.S. Note 3(a)(ii), and 3(c), Subchapter XX, Chapter 98, HTSUSA. However, there is no provision that provides for linings of foreign origin. Therefore, the fabric used to manufacture the lining of the coats would also have to be manufactured in the United States.

You have also requested information about the findings and trimmings provision of the CBTPA for your informational purposes. Subchapter XX, U.S. Note 3(a), HTSUSA, provides:

An article otherwise eligible for preferential treatment under any provision of this subchapter shall not be ineligible for such treatment because the article contains—

(i) findings or trimmings of foreign origin, if the value of such findings and trimmings does not exceed 25 percent of the cost of the components of the assembled article[.]

The Interim Regulations, regarding findings and trimmings further provide:

An article otherwise described under paragraph (a) of this section will not be ineligible for the preferential treatment referred to in [19 C.F.R.] § 10.221 because the article contains:

(A) Findings and trimmings of foreign origin, if the value of those findings and trimmings does not exceed 25 percent of the cost of the components of the assembled article. For the purposes of this section “findings and trimmings” include, but are not limited to, hooks and eyes, snaps, buttons, “bow buds”, decorative lace trim, elastic strips (but only if they are each less than 1 inch in width and are used in the production of brassieres), zippers (including zipper tapes), labels, and sewing thread except in the case of an article described in paragraph (a)(3) or (a)(12) of this section.

“Findings” are generally accepted to be sewing essentials used in textile goods while “trimmings” are decorative or ornamental parts. See, for example, Headquarters Ruling Letter (“HQ”) 559552, dated February 14, 1996; HQ 560398, dated July 29, 1997; HQ 560458, dated March 6, 1998; HQ 559780, dated May 19, 1997 and HQ 560520, dated September 22, 1997, for examples of what qualifies as a finding or trimming. See also, HQ 558954, dated June 30, 1995; HQ 559522, dated February 14, 1996; HQ 559738, dated July 2, 1996; HQ 559794, dated June 3, 1996; and HQ 559738, dated July 2, 1996, for examples of what does not qualify as a finding or trimming.

Provided the cost of such findings and trimmings do not exceed 25 percent of the cost of the components of the assembled men’s suits and the suits are assembled in the Dominican Republic from fabric wholly formed in the U.S. from yarns wholly formed in the U.S. using sewing thread formed in the U.S., then you could use foreign findings and trimmings in the manufacture of men’s suits.

HOLDING:

The subject men’s suits are not eligible for preferential treatment under the CBTPA due to use of foreign made sewing thread in the assembly process and the use of fabric of foreign origin.

The men’s suits are properly classified in subheading 6203.11.9000, HTSUSA, which provides for “Men’s or boys’ suits, ensembles, suit-type jackets, blazers, trousers, bib and brace overalls, breeches and shorts (other than swimwear): Suits: Of fine wool or animal hair: Other: Other.” The general column one rate of duty is 10.6 cents per kilogram plus 18.2 percent ad valorem. The textile category number is 443.

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.

The designated textile and apparel category may be subdivided into parts. If so, visa and quota requirements applicable to subject merchandise may be affected. Since part categories are the result of international bilateral agreements which are subject to frequent renegotiations and changes, to obtain the most current information available, we suggest that you check, close to time of shipment, The Status Report on Current Import Quotas (Restraint Levels), an internal issuance of the U.S. Customs Service, which is available for inspection at your 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 your local Customs office prior to importation of this merchandise to determine the current status of any import restraints or requirements.

Sincerely,

John E. Elkins, Chief
Textiles Classification Branch

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See also:

• Tariff No.: 6203.11.90 - Men's or boys' suits of wool or fine animal hair, not knitted or crocheted, nesoi
• Tariff No.: 9820.11.03 - CBTPA goods: Apparel article of chapter 61/62 assembled one or more CBTPA country under certain conditions from fabrics formed and cut in US
• Tariff No.: 9820.11.06 - CBTPA goods: Apparel articles cut in one or more CBTPA from US formed fabric of US formed yarn assembed in CBTPA with US yarn
• Tariff No.: 9820.11.30 - CBTPA goods: Handloomed, handmade or folklore textile and apparel goods, under terms of US note 4 to this subchapter