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NY J80890




February 28, 2003

CLA-2-61:RR:NC:TA:358:J80890

CATEGORY: CLASSIFICATION

TARIFF NO.: 6111.20.6020

Ms. Karanda Ho
L&K Knitters (Canada) Inc.
250 West Beaver Creek Road
Unit 10, Richmond Hill
Ontario, Canada L4B 1C7

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of infants’ knitwear from Canada; Article 509

Dear Ms. Ho:

In your letter dated February 20, 2003, you requested a ruling on the classification and country of origin status of two styles of infants’ knitted apparel from Canada, under NAFTA.

Style No. RC819600 (girls) and Style No. BC819602 (boys) are both 3-piece infants’ sets. The styles, which are assumed to be identical except for color, consist of sets of finely knitted, cardigans, pants and hats in a patterned self-fabric cable design. The cardigan has long sleeves, rib knitted fabric at the cuffs, neckline and waistband and a five button frontal opening which fastens left over right. The pants have a covered elasticized waistband and rib knitted fabric at the ankles and waist. The sock hat has rib knitted fabric surrounding the head crown. The fiber content is 100% cotton.

You state that the manufacturing operations for the styles are as follows:

Hong Kong or China

2/32 100 % cotton yarn supplied by H.K./China mills.

Canada

The entire front, back, sleeves and hat panels are knitted entirely from originating materials to shape in Canada and exported back to China for final finishing.

China

The said knitted panels are returned to China where they are assembled by looping and linking. The garments are finally shipped from Hong Kong/China directly to USA.

ISSUE:

What are the classification and country of origin of the subject merchandise?

CLASSIFICATION:

The applicable tariff provision for Style No. RC819600 and Style No. BC819602, will be 6111.20.6020, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for babies’ garments and clothing accessories, knitted or crocheted, of cotton, other, other, sets. The general rate of duty will be 8.2% ad valorem.

COUNTRY OF ORIGIN - LAW AND ANALYSIS:

On December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act (codified at 19 U.S.C. 3592) provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. On September 5, 1995, Customs published Section 102.21, Customs Regulations, in the Federal Register, implementing Section 334 (60 FR 46188). Thus, effective July 1, 1996, the country of origin of a textile or apparel product shall be determined by sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.

Paragraph (c)(1) states that "The country of origin of a textile or apparel product is the single country, territory, or insular possession in which the good was wholly obtained or produced." As the subject merchandise is not wholly obtained or produced in a single country, territory or insular possession, paragraph (c)(1) of Section 102.21 is inapplicable.

Paragraph (c)(2) states: "Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) of this section, the country of origin of the good is the single country, territory, or insular possession in which each of the foreign materials incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement specified for the good in paragraph (e) of this section:"

Paragraph (e) states that "The following rules shall apply for purposes of determining the country of origin of a textile or apparel product under paragraph (c)(2) of this section":

HTSUS Tariff shift and/or other requirements

6101-6117 If the good is knit to shape, except for goods of subheading 6117.10 provided for in paragraph (e) (2) of this section, a change to heading 6101 through 6117 from any heading outside that group, provided that the knit-to-shape components are knit in a single country, territory or insular possession.

The subject merchandise is classifiable as babies’ knit sets in heading 6111, HTSUS. Section 102.21 (e) requires a tariff shift to headings 6101 through 6117 from any heading outside that group. In this case, a tariff shift to heading 6111, HTSUS, occurs in Canada from components that are classifiable from a heading outside that group. Consequentially, Section 102.21 (c)(2), the tariff shift is applicable.

However, Style No. RC819600 and Style No. BC819602 do not qualify for preferential treatment under the NAFTA because one or more of the non-originating materials used in the production of this garment will not undergo the change in tariff classification required by General Note 12(t)/61.35, HTSUSA. Specifically, the style is not “both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the NAFTA parties,” from originating materials as is required by the General Note.

We also note Additional U.S. Note 3 (a), Section XI, HTSUSA, which provides for a reduced rate of duty (the Tariff Preference Levels – TPL) for apparel goods of Chapters 61 and 62, which are imported from Canada, provided that they are both cut (or knit to shape) and sewn or otherwise assembled in the territory of a NAFTA party from fabric or yarn produced or obtained outside the territory of one of the NAFTA parties. Since the merchandise is not imported from Canada, and is not sewn or otherwise assembled in the territory of a NAFTA party, it does not qualify for this reduced rate of duty.

The country of origin of the 3-piece infants’ sets, Style No. RC819600 and Style No. BC819602 is Canada. Based upon international textile trade agreements, products of Canada are not subject to visa requirements and quota restraints.

HOLDING:

The holding set forth above applies only to the specific factual situation and merchandise identified in the ruling request. This position is clearly set forth in section 19 CFR 177.9(b)(1). This sections states that a ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). Should it be subsequently determined that the information furnished is not complete and does not comply with 19 CFR 177.9(b)(1), the ruling will be subject to modification or revocation. In the event there is a change in the facts previously furnished, this may affect the determination of country of origin. Accordingly, if there is any change in the facts submitted to Customs, it is recommended that a new ruling request be submitted in accordance with 19 CFR 177.2.

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Bruce Kirschner at (646) 733-3048.

Sincerely,

Robert B. Swierupski
Director,

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