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HQ 966587




September 23, 2003

CLA-2 RR:TC:TE 966587 ASM

CATEGORY: CLASSIFICATION

TARIFF NO.: 9819.11.12

Joe Lucatuorto
Customs Compliance Auditor
Associated Merchandising Corporation
500 Seventh Ave.
New York, NY 10018

RE: Effect of imported PVC belt on eligibility of pants for AGOA; subheading 9819.11.12

Dear Mr. Lucatuorto:

This ruling is in response to your letter of May 27, 2003, requesting guidance from the Bureau of Customs and Border Protection (CBP) on the eligibility of ladies’ pants to be produced in Swaziland and exported to the United States with a PVC (polyvinylchloride) belt from Taiwan.

FACTS:

The sample is a pair of ladies' pants of 65 percent polyester/35 percent cotton woven fabric. The fabric will be formed in Taiwan, however, the cutting, assembly and all other manufacturing will be done in Swaziland. After the pants are completed, a PVC belt made in Taiwan is attached at the waist by threading it through the belt loops.

ISSUE:

Does the addition of a non-textile foreign belt to a pair of pants, which otherwise would qualify for preferential treatment under AGOA, disqualify the pants for preferential treatment?

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. Swaziland was designated a beneficiary country by Presidential Proclamation 7400, published in the Federal Register on January 23, 2001 (66 Fed. Reg. 7373). It was determined to be eligible for textile benefits under the AGOA by the USTR effective July 26, 2001. See 66 Fed. Reg. 41648, dated August 8, 2001.

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).

Based on the information you have provided, the ladies' pants at issue qualify for classification in subheading 9819.11.12, HTSUSA, which provides for:

Apparel articles wholly assembled, or knit-to-shape and wholly assembled, or both, in one or more such lesser developed countries enumerated in U.S. note 2(d) to this subchapter, subject to the provisions of U.S. note 2 to this subchapter, regardless of the country of origin of the fabric or the yarn used to make such articles, if entered during the period beginning on the date announced in a Federal Register notice issued by the United States Trade Representative and continuing through September 30, 2004, inclusive.

The fabric for the pants is imported from a third (non-beneficiary) country and is cut into components which are wholly assembled in Swaziland into the ladies' pants. Thus, the subject ladies' pants qualify for preferential treatment under the AGOA.

The issue at hand is whether adding a foreign non-textile belt to an otherwise eligible garment, i.e., the ladies' pants, will preclude eligibility for preferential treatment.

For classification purposes, the ladies' pants and the PVC belt from Taiwan are classified together as a set put up for retail sale. If imported separately, the pants would be classified in heading 6204, HTSUS, which provides for, among other things, women's woven pants. The PVC belt, if imported separately, would be classified in heading 3926, HTSUS, which provides for, among other things, other articles of plastics. General Rule of Interpretation (GRI) 3(b) provides, in part, that when not classifiable under GRI 2(b) (a rule for classification of mixtures and combinations of materials or substances), goods put up in sets for retail sale are classified as if they consisted of the component that imparts the essential character to the set. CBP (formerly, U.S. Customs Service) has issued numerous rulings on the classification of garments put up as a set with non-textile belts. See, e.g., NY I85652 of September 20, 2002, classifying a women's shorts and belt set. In each case, the garment determined the classification of the set. The same is true here. The PVC belt is classified with the ladies' pants as a set. If you intend to produce pants, such as the submitted sample, the same principle would hold, i.e., the PVC belt would be classified with the pants as a set.

Having established that the pants and belt are classified together, the issue remains as to whether inclusion of the belt will preclude the set from receiving preferential treatment under the AGOA.

The language of the various apparel provisions of the AGOA sets forth requirements regarding the production of the apparel, including requirements specific to the formation of the yarn and fabric used in the production of the apparel. There are no requirements set forth with regard to non-textile components, which may be used in the production of the apparel except for those items that would be considered "findings or trimmings." Note 3, Subchapter XIX, Chapter 98, provides, in relevant part, that:

(a) [a]n article otherwise eligible for preferential treatment under any provision of [subchapter XIX] 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;

(b) For purposes of subdivision (a)(i) above, findings and trimmings eligible under such subdivision include sewing thread, hooks and eyes, snaps, buttons, "bow buds", decorative lace trim, elastic strips, and zippers (including zipper tapes) and labels. Elastic strips are considered findings and trimmings only if they are each less than 2.54 cm in width and used in the production of brassieres. For purposes of articles described in subheading 9819.11.06 and 9819.11.30, sewing thread shall not be considered to be findings or trimmings.

Clearly, the PVC belt is not a finding or trimming; it is an accessory to the pants.

CBP has issued rulings on the affect non-textile components have on the eligibility of textile articles for preferential treatment under other programs. In HQ 562018 of March 22, 2002, CBP ruled that a third country (non-beneficiary) polyurethane strip which functioned as a brassiere strap and a polyurethane cup used in the production of brassieres had no affect on the eligibility of the brassieres under the Caribbean Basin Trade Partnership Act (CBTPA). In HQ 562309 of July 16, 2002, CBP ruled that leather components used to form the strap end and to join metal buckles with the woven cotton fabric that formed the strap of a belt did not preclude the belt's eligibility for preferential treatment under the CBTPA. In 557875 of May 4, 1995, CBP ruled that textile soft-sided luggage qualified for preferential treatment under subheading 9802.00.90, HTSUSA, (provided the findings and trimmings did not exceed the applicable value limitation) because the textile components met the requirements of the provision. Non-textile components, such as the metal frame, were not considered in determining eligibility. This was also true in HQ 560649 of December 9, 1997, in which CBP ruled a pet toy stuffed with polyester fiber of foreign origin qualified under 9802.00.90, HTSUSA.

Based on the above-cited precedent, the inclusion of the PVC belt with the otherwise eligible ladies' pants will not preclude eligibility of the set for preferential treatment under the AGOA. In addition, we note that this finding is consistent with our recent decision in HQ 966495, dated July 3, 2003.

HOLDING:

The addition of a PVC belt from Taiwan with a pair of ladies' pants will not preclude eligibility for preferential treatment under the AGOA provided the ladies' pants otherwise meet the requirements for preferential treatment under the AGOA. Provided the pants are produced as described in your submission, according to GRI 3(b), the pants and belt will be classifiable in subheading 9819.11.12, HTSUS.

A copy of this ruling 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 CBP officer handling the transaction.

Sincerely,

Myles B. Harmon, Director
Commercial Rulings Division

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