United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 2003 HQ Rulings > HQ 966496 - HQ 966648 > HQ 966552

Previous Ruling Next Ruling
HQ 966552




September 23, 2003

CLA-2 RR:CR:TE 966552 SG

CATEGORY: CLASSIFICATION

TARIFF NO.: 9819.11.12

Ms. Kristin Parmar
15937 Bancroft Ct. #627
Omaha, NE 68130

RE: African Growth and Opportunity Act; Machine-Woven Batik and Tie-Dyed Fabrics and Textile Articles: Limitations on Benefits

Dear Ms. Parmar:

The purpose of this correspondence is to respond to your request dated June 12, 2003, for a binding classification ruling on Batik and Tie-dyed woven cotton fabric from Ghana. You also ask whether the fabric or apparel constructed from this fabric would be eligible for preferential duty- or quota-free treatment under the African Growth and Opportunity Act (AGOA).

FACTS

You are interested in importing batik and tie-dyed woven cotton fabric from Ghana. You indicate that the fabric starts out as plain, white woven cotton cloth which is machine woven in Ghana from cotton yarn that originates in Ghana. The fabric is dyed by hand in 6-yard lengths using either the batik or tie-dye methods.

You advise that batiks are made using hot, melted wax to resist the dyes that are later applied. You indicate that although there are many techniques for applying the wax, it is most frequently done by using wood or foam stamps dipped in wax to make a pattern or design. The cloth is then placed in dyes of various colors. The wax is removed by dipping the cloth in boiling water.

Tie-dye fabrics are described as being made by folding, tying, twisting, or wrapping the cotton cloth in various ways before dipping the cloth into the dyes.

You state that the fabric will be imported for resale by the piece or yard, for use in sewing, home décor, clothing and crafts. In addition you indicate that the fabric, after dyeing, will be cut, sewn and assembled in Ghana into various textile and apparel articles (such as bags, tablecloths, pillow covers, aprons, dresses and shirts) which you intend to import into the United States. A small swatch of the fabric was provided.

ISSUE

Is cotton fabric formed and batik or tie-dyed in Ghana eligible for preferential duty and quota treatment under the African Growth and Opportunity Act? Are textile and apparel articles made in Ghana from this fabric eligible for preferential duty and quota treatment under the African Growth and Opportunity Act?

LAW AND ANALYSIS

The African Growth and Opportunity Act (AGOA) provides certain specified trade benefits for countries of sub-Saharan Africa. These benefits include duty-free treatment for certain non-textile articles previously excluded from preferential treatment under the Generalized System of Preferences, and duty- and quota-free treatment for certain textile and apparel articles which meet the requirements set forth in Section 112 of the Act (codified at 19 U.S.C. 3721). Beneficiary countries are designated by the President of the United States after having met eligibility requirements set forth in the AGOA. Once designated, a beneficiary country is entitled to the duty-free treatment for the designated non-textile articles determined not to be import-sensitive in the context of imports from the beneficiary sub-Saharan African countries. A second designation by the United States Trade Representative (USTR), published in the Federal Register, that a beneficiary country has taken the measures required by the Act to prevent unlawful transshipment and has adopted an effective visa system, is necessary before a beneficiary country may enjoy the duty- and quota-free benefits extended to textile and apparel articles under the Act. Ghana was designated a beneficiary country by Presidential Proclamation 7350, published in the Federal Register on October 2, 2000. It was determined to be eligible for textile benefits under the AGOA by the USTR effective March 20, 2002. See, 66 Fed. Reg. 14761, dated March 27, 2002.

The provisions implementing the textile provisions of the AGOA in the Harmonized Tariff Schedule of the United States (HTSUS) are contained, for the most part, in subchapter XIX, Chapter 98, HTSUS (one provision may be found in subheading 9802.00.80, HTSUS). The regulations pertinent to the textile provisions of the AGOA may be found at §§ 10.211 through 10.217 of the Customs Regulations (19 CFR 10.211 through 10.217).

Handloomed fabrics and textile articles meeting the description in subheading 9819.11.27, HTSUS, are eligible for preferential treatment under the AGOA. This subheading provides as follows:

Handloomed, handmade or folklore textile and apparel goods, under the provisions of U.S. note 4 to this subchapter.

U.S. note 4 to subchapter XIX, Chapter 98, HTSUS, reads as follows:

For purposes of subheading 9819.11.27, goods entered under this provision must be certified, by a competent authority of a designated beneficiary country enumerated in U.S. note 1 to this subchapter, as eligible products of such country, in accordance with any requirements established by the appropriate U.S. government authority.

Moreover, the AGOA legislation mandates the President consult with representatives of the AGOA beneficiary countries concerned for the purpose of identifying particular textile and apparel goods that are mutually agreed upon as being handloomed, handmade or folklore goods.

The Committee for the Implementation of Textile Agreements (CITA), pursuant to sections 112(a) of the AGOA and Executive Order 13191 of January 17, 2001, has determined, effective September 15, 2003, that handloomed fabrics, handloomed articles (e.g. handloomed rugs, scarves, placemats, and tablecloths), handmade articles made from handloomed fabrics, and certain folklore articles qualify for preferential treatment under the AGOA. Imports of eligible products from Ghana with appropriate visas will qualify for duty-free treatment. See, 68 Fed. Reg. 53967 (copy enclosed). We note however that in your correspondence you indicated that you intend to import machine-made fabric and textile articles made from this machine-made fabric. Thus neither the fabric nor the textile articles you have indicated you intend to import will be eligible for duty-free treatment under subheading 9819.11.27, HTSUS. We note that there are no other AGOA provisions under which machine-made fabric or textile articles (other than apparel articles) made from machine-made fabric can get beneficial tariff treatment.

Although neither the fabric nor textile articles made of the fabric described above qualify for duty free treatment under 9819.11.27, HTSUS, apparel articles made in Ghana from this fabric (regional fabric) may be eligible for duty free treatment under subheading 9819.11.09, HTSUS. Subheading 9819.11.09, HTSUS, reads:

Apparel articles wholly assembled in one or more such countries from fabric wholly formed in one or more such countries from yarn originating in either the United States or one or more such countries (including fabrics not formed from yarns, if such fabrics are classifiable in heading 5602 or 5603 and are wholly formed and cut in one or more such countries), or from components knit-to-shape
in one or more such countries from yarns originating either in the United States or in one or more such countries, or apparel articles wholly formed on seamless knitting machines in such a country from yarns originating either in the United States or one or more such countries, subject to the provisions of U.S. note 2 to this subchapter.

In order to rule on the application of the regional fabric preference to articles manufactured from the batik or tie-dyed fabric, Customs and Border Protection (CBP) would have to determine whether the merchandise constitutes apparel articles wholly assembled in Ghana from fabric that was wholly formed in Ghana from yarns that originated in Ghana. We have not been provided with samples of the merchandise or enough information as to how the merchandise is manufactured to make that determination. However, the following is offered for your edification.

The articles imported must initially meet the definition of "apparel articles." "Apparel articles" is defined by Customs Regulations as "goods classifiable in Chapters 61 and 62 and headings 6501, 6502, 6503 and 6504 and subheadings 6406.99 and 6505.90 of the HTSUS." 19 C.F.R. 10.212.

The apparel article must be "wholly assembled in" one or more beneficiary sub-Saharan African countries, from fabric "wholly formed" in one or more beneficiary sub-Saharan African countries, from yarn that originated in one or more such beneficiary countries or the United States. Ghana was designated a beneficiary country and a lesser developed beneficiary country. "Wholly assembled in," for the purpose of textile and apparel articles under the AGOA, means "that all of the components of the textile or apparel article (including thread, decorative embellishments, buttons, zippers, or similar components) were joined together in one or more beneficiary countries or one or more lesser developed beneficiary countries." 19 C.F.R. 10.212.

The phrase "wholly formed," when used with reference to fabric, means "that all of the production processes, starting with polymers, fibers, filaments, textile strips, yarns, twine, cordage, rope, or strips of fabric and ending with a fabric by a weaving, knitting, needling, tufting, felting, entangling or other process, took place in the United States or one or more beneficiary countries."

The yarn is considered as "originating" in Ghana when the country of origin is determined to be Ghana through the application of rules for determining the country of origin of textile and apparel products contained in 19 C.F.R. 102.21.

Generally, apparel articles imported into the United States which meet the requirements of the Customs AGOA implementing regulations would be eligible to receive the preferential tariff and quota benefits provided in the AGOA provided they are imported directly into the Customs territory of the U.S. from an AGOA beneficiary country and
they meet the remaining requirements of the relevant AGOA provisions. We suggest that prior to importing the actual apparel articles, you seek a binding ruling on the applicability of the AGOA to the specific apparel articles you intend to import. It would also be helpful if you provided samples of the articles.

As we advised you telephonically, we do not have enough information to issue a binding classification ruling on the cotton fabric. You indicated that you will be submitting additional information and making a separate classification request. Accordingly, we will not be addressing the classification issue in this letter.

HOLDING:

Machine-made batik or tie-dyed fabric is not eligible for duty free treatment under the AGOA. As a product of Ghana, the fabric is not subject to quota.

Sincerely,


Previous Ruling Next Ruling

See also: