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HQ 562482





October 30, 2002

CLA-02 RR:CR:SM 562482 KKV

CATEGORY: CLASSIFICATION

TARIFF NO.: 9820.11.15

Mr. Ken Dickinson
Vanity Fair Intimates, LP
2801Galveston
McAllen, TX 78502

RE: Eligibility of certain brassieres for preferential tariff treatment under the CBTPA; bust cups, U.S.-origin material laminated in U.S., molded and cut in Mexico and assembled in Honduras

Dear Mr. Dickinson:

This is in response to your recent undated ruling request addressed to the National Specialist Commodities Division, New York, which was forwarded to our office for reply. Specifically, you inquire whether a certain style of brassiere is eligible for preferential tariff treatment under the Caribbean Basin Trade Preference Act (CBTPA). A sample of the brassiere was submitted for our examination.

FACTS:

The sample provided is Vanity Fair Intimates Style No. 75238, a man-made fiber underwire brassiere with molded foam cups. The item features adjustable shoulder straps, elasticized edging on the bottom of the sides and back and an adjustable double hook and eye rear closure.

We are informed that the brassiere’s knit back portion and front center fabric is composed of 90% nylon and 10% spandex, which has been formed and cut in the United States from yarn originating in the United States. The brassiere cups are made of knit fabric, formed in the U.S., consisting of 95% nylon (made from yarn that originates in the United Kingdom) and 5% spandex (made from yarn formed in the U.S). In the U.S., this fabric is laminated onto both sides of foam of U.S. origin. We are informed that the laminated foam is exported to Mexico, where it is subsequently cut and molded into cups. The molded cups are then exported to Honduras, where they are assembled together with U.S. trimming and underwire to form the finished brassiere.

The finished brassieres will be imported into the United States. Notwithstanding the production processes performed in Mexico, you state that you “would like to “qualify the brassieres under the allowed 25% because this production combined with the other eligible production still meets the 75% U.S. requirement of the controlling entity.”

ISSUE:

Whether the subject brassieres 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. Section 3107(a) of the Trade Act of 2002 (Pub.L. 107-210, 116 Stat. 933), signed into law on August 6, 2002, modified the treatment accorded to textile and apparel articles produced in designated CBTPA countries under section 213(b) of the CBERA.

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.

As amended by section 211 of the CBTPA and section 3107(a)(5) of the Trade Act of 2002, 19 U.S.C. 2703(b)(2)(A)(iv), provides (in pertinent part) preferential tariff treatment during the transition period for:

Subject to subclause (II), any apparel article classifiable under subheading 6212.10 of the HTS, except for articles entered under clause (i), (ii), (iii), (v), or (vi), if the article is both cut and sewn or otherwise assembled in the United States, or one or more CBTPA countries, or both.

During the 1-year period beginning on October 1, 2001, and during each of the 6 succeeding 1-year periods, apparel articles described in subclause (I) of a producer or an entity controlling production shall be eligible for preferential treatment under subparagraph (B) only if the aggregate cost of fabrics (exclusive of all findings and trimmings) formed in the United States that are used in the production of all such articles of that producer or entity that are entered and eligible under this clause during the preceding 1-year period is at least 75 percent of the aggregate declared customs value of the fabric (exclusive of all findings and trimmings) contained in all such articles of that producer or entity that are entered and eligible under this clause during the preceding 1-year period.

As stated in 19 U.S.C. 2703(b)(2)(A)(iv), brassieres are eligible for preferential treatment “if the article is both cut and sewn or otherwise assembled in the United States, or one or more CBTPA beneficiary countries, or both.” Under the facts presented in this case, because the cutting of the laminated fabric is to be performed in Mexico, the finished brassieres will not be eligible for preferential treatment under this CBERA provision upon importation into the U.S.

HOLDING:

Under the facts presented, brassieres that are made from U.S.-origin fabric that is laminated in the U.S., cut and molded in Mexico and assembled together with trimmings and underwire in Honduras will not be eligible for preferential tariff treatment under the CBTPA.

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,

Myles B. Harmon

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