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HQ 966761

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December 15, 2003

CLA-2 RR:CR:TE 966761 KSH

CATEGORY: CLASSIFICATION

TARIFF NO.: 9819.11.12

Ms. Melissa Weiss
Barthco Trade Consultants
721 Chestnut Street
Philadelphia, PA 19106

RE: African Growth and Opportunity Act; Findings and Trimmings; Lesser Developed Country; Swaziland

Dear Ms. Weiss:

This is in response to your letter dated September 5, 2003, on behalf of your client Leonard Feinberg, Inc., requesting a binding ruling on the eligibility of a pair of women’s sweatpants and a women’s jacket for preferential treatment under the African Growth and Opportunity Act (AGOA). New York Ruling (NY) J88418, issued September 23, 2003, addressed the eligibility of a girl’s long sleeve three button placket shirt (Style 53026) and a women’s knitted sleeveless pullover (Style 5913), which were part of your September 5, 2003 request. The issue of the eligibility of the women’s sweatpants and women’s jacket has been referred to this office for a direct response to you. Two sample garments were submitted to our office for our consideration.

FACTS:

At issue are two women’s knit fabric garments. The first garment is a woman’s jacket, Style 5610. It is constructed from 60% cotton, 40% polyester knitted fabric that has been napped on both sides. The jacket has more than nine stitches per two centimeters, measured in the direction in which the stitches are formed. The jacket has a self fabric hood with a drawstring closure, a full front opening with a zippered closure, long sleeves with rib knit cuffs, a rib knit waistband, and two slanted pockets at the waist.

The fabric and trimmings will be shipped in rolls from Taiwan to Swaziland. The plastic tips and zippers will originate in Taiwan and be sent to Swaziland in separate pieces. The fabric will be cut and assembled into a jacket in Swaziland.

The second garment is a pair of women’s sweat pants, style 0724. The sweat pants are constructed from 60% cotton, 40% polyester knit fabric. The pants have an elasticized waistband with a drawstring, appliqued strips on either side of the side seams, and hemmed leg openings. The pants also have a large applique of the words “wild thing” on the back, and a heat transfer applique on the front of the words “wild thing” and a collegiate style emblem of the words “Super Star Team.”

All of the fabric and trimmings will be shipped in rolls from Taiwan to Swaziland. The fabric used to make the sweat pants will be cut and assembled in Swaziland.

ISSUE:

Whether the subject apparel articles are eligible for preferential treatment under the AGOA?

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).

Apparel articles wholly assembled in a sub-Saharan African lesser developed beneficiary country (LDC) and directly imported into the U.S. are entitled to duty free status, subject to certain restrictions. Such articles are entered under subheading 9819.11.12, HTSUS, which provides as follows:

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.

U.S. Note 2(d) lists Swaziland as qualifying for designation as a LDC. U.S. Note 2, Subchapter XIX, Chapter 98, HTSUS, provides for a quantitative restriction for apparel articles classified in subheading 9819.11.12.

The garments subject to this ruling letter are assembled in Swaziland from fabric that is knit in Taiwan. The fabric and trimming for the woman’s jacket will be shipped in rolls from Taiwan to Swaziland. The sewing thread and drawcord will originate in Taiwan and will be shipped to Swaziland in rolls. The plastic tips and zipper will originate in Taiwan and will be sent to Swaziland in separate pieces.

The fabric and trimmings of the sweatpants will be shipped in rolls from Taiwan to Swaziland. The sewing thread, fabric appliques, heat transfer appliques, drawcord and elastic for the waistband will originate in Taiwan and be sent to Swaziland in rolls.

AGOA eligibility requires that the apparel articles be "[w]holly assembled in" the lesser developed beneficiary sub-Saharan African country to be eligible for lesser developed country benefits. "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 assembly process of the woman’s jacket and sweat pants meets the regulatory definition of "[w]holly assembled in." Subheading 9819.11.12, HTSUS, specifically provides that the country of origin of the fabric is not a consideration. Since the country of origin of the fabric is not relevant to the receipt of AGOA lesser developed beneficiary country preferential tariff and quota treatment, provided the other requirements of the Act are met, the fact that the fabric originates in Taiwan does not have an affect on benefit eligibility.

In HQ 562766, dated August 6, 2003, we determined that the use of non-U.S. or non-beneficiary country elastic fabric imported in rolls used to make a waistband would not render women's trousers ineligible for classification in subheading 9819.11.12, HTSUSA, because the elastic fabric would not be considered a finding or trimming as defined in U.S. Note 3(b), Subchapter XIX, and would be considered fabric. Likewise, the elastic fabric imported in rolls from Taiwan to make the waistband of the woman’s sweat pants in Swaziland will not render them ineligible for classification in subheading 9819.11.12, HTSUSA.

In HQ 966585, dated September 24, 2003, we determined that tubular braided drawstrings, without tipped ends, to be finished and incorporated into garments assembled in a LDC are considered non-originating “fabric” under the AGOA and will not preclude the completed garments from eligibility for duty free treatment under subheading 9819.11.12, HTSUSA. The drawstrings in the instant case from Taiwan that will be tipped and incorporated into the jacket and sweat pants in Swaziland are considered non-originating fabric under the AGOA.

Provided the findings and trimmings on the garments do not exceed 25 percent of the cost of the components of the garments, they will not preclude the garments from qualifying for AGOA preferential treatment. See U.S. Note 3(a)(i), to Subchapter XIX, Chapter 98, above. Having established that the origin of the fabric is not a consideration for AGOA eligibility, we must determine whether the appliques on the sweatpants constitute findings and trimmings.

U.S. Note 3(a)(i), to Subchapter XIX, Chapter 98, provides that: An article otherwise eligible for preferential treatment under any provision of this subchapter shall not be ineligible for such treatment because the article contains—
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; or

U.S. Note 3(b) to Subchapter XIX, Chapter 98, states in pertinent part:

For purposes of subdivision (a)(i) above, findings or 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 or trimmings only if they are each less than 2.54 cm in width and used in the production of brassieres. . .

While "findings and trimmings" for purposes of the AGOA were not specifically defined, the examples set forth above, such as zippers, buttons, decorative lace trim and labels are indicative of the types of components which are considered to be within the purview of this provision. Accordingly, the zipper, drawstring tips and sewing thread will qualify as findings and trimmings.

The exception for findings and trimmings was necessarily intended to be of a restrictive nature, as the intent of the statute was to ensure that all fabric components be formed and cut in the U.S. or sub-Saharan African beneficiary countries. "Findings" are generally accepted to be sewing essentials used in textile goods while "trimmings" have been defined as "decoration or ornamental parts." See M. Picken, The Fashion Dictionary (1973).

In HQ 559738, dated July 2, 1996, CBP held that a synthetic suede yoke and elbow patches were not "findings and trimmings" because they comprised a large surface area of the garment and served more than decorative purposes. However, embroidered patch labels which indicate or symbolize the brand name and provide ornamentation have been held to be "findings and trimmings" for purposes of subheading 9802.00.90, HTSUS (formerly the Special Regime Program) and the Special Access Program. See HQ 560520, dated September 22, 1997, and HQ 560726, dated December 12, 1997. Moreover, in HQ 965426, dated April 23, 2002, CBP held that a woven decorative patch sewn to the chest area of a sleeveless knit top is a "trimming" for purposes of the CBTPA. Moreover in HQ 562027, dated May 23, 2002, we determined that foreign-origin heat transfers, which are used to provide ornamentation to t-shirts, are "trimmings," for purposes of the CBTPA.

The heat transfer appliqué of the words “wild thing” and collegiate style emblem of the words “Super Star Team” on the front is clearly used to provide ornamentation to the sweat pants and qualifies as a trimming. The “wild thing” appliqué on the back is clearly ornamental in nature and merely serves a decorative purpose. Accordingly, we find that the “wild thing” fabric appliqué is a trimming for purposes of the AGOA.

HOLDING:

The woman’s knit jacket and sweat pants meet the requirements of subheading 9819.11.12, HTSUSA, as well as the U.S. Notes to Subchapter XIX and are, therefore, eligible to receive the preferential tariff and quota benefits provided for by the AGOA.

The use of foreign origin sewing thread, zipper, appliques, and plastic tips will not render the garments ineligible for preferential treatment under the AGOA provided the garments otherwise meet the requirements for classification within an AGOA provision and provided the value of the foreign-origin findings and trimmings do not exceed 25 percent of the total cost of the components of the garments.

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, Director
Commercial Rulings Division

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See also:

• Tariff No.: 9802.00.80 - U.S. articles assembled abroad, which have not lost their physical identity or have not advanced in value or improved in condition abroad
• Tariff No.: 9802.00.90 - Textile and apparel goods, assembled in Mexico in which all fabric components were wholly formed and cut in the United States, etc.
• Tariff No.: 9819.11.12 - AGOA goods: Apparel articles assembled in a lesser developed AGOA and subject to quota in US note 2 to this subchapter entered til 9/30/2012