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NY J85303




June 23, 2003

CLA-2-RR:NC:TA:349 J85303

CATEGORY: CLASSIFICATION

Ms. Susan D. Klingbeil
IKEA Wholesale
496 W. Germantown Pike
Plymouth Meeting, PA 19462

RE: Classification, status under the North American Free Trade Agreement (NAFTA), and country of origin determination for cushions; 19 CFR 102.21(c)(5); last country where an important assembly or manufacturing process occurred; Article 509

Dear Ms Klingbeil:

This is in reply to your letter dated May 28, 2003, requesting a classification, status under the NAFTA and country of origin determination for cushions which will be imported into the United States.

FACTS:

The subject merchandise consists of cushions. A sample was not submitted. The cushions, referred to as Article 600 663 09, consist of a cushion cover and a removable cushion or pillow form. The outer cover of the cushion is made from a 100 percent cotton woven fabric. It has a zippered opening. The shell of the form will be made from either a 100 percent cotton woven fabric or a 100 percent polypropylene nonwoven fabric. It is stuffed with polyester fiberfill. The cushions measure 28 inches square. The manufacturing operations are as follows:

BANGLADESH:
-cotton fabric for outer cover is woven and finished. -fabric is cut and sewn forming the covers. -cushion covers are shipped to Mexico.

KOREA OR THE UNITED STATES:
-polyester fiberfill is created.
-loose fill is shipped to Mexico.

UNITED STATES:
-cotton fabric for shell of form is woven from U.S. fibers or -polypropylene nonwowen fabric is formed from U.S. fibers. -rolls of fabric are shipped to Mexico.

MEXICO:
-cotton fabric for shell of form is woven from Mexican fibers (if U.S. made fabric is not used).
-fabric (cotton or polypropylene) is cut to size. -fabric is sewn creating the shell of the inner form. -form is stuffed and sewn closed.
-form is inserted into the cushion cover and zipper is closed. -finished cushions are packed and shipped.

ISSUE:

What are the classification, eligibility under NAFTA and country of origin for the subject merchandise?

CLASSIFICATION:

The applicable subheading for the cushion will be 9404.90.1000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for mattress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with any material or of cellular rubber or plastics, whether or not covered: other: pillows, cushions and similar furnishings: of cotton. The general rate of duty will be 5.4 percent ad valorem.

The cushions fall within textile category designation 369. The designated textile and apparel categories and their quota and visa status are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information, we suggest that you check, close to the time of shipment, the Textile Status Report for Absolute Quotas, which is available at our Web site at www.cbp.gov. In addition, the designated textile and apparel categories may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected and should also be verified at the time of shipment.

NAFTA ELIGIBILITY:

The cushions undergo processing operations in the United States and Mexico which are countries provided for under the North American Free Trade Agreement. These products will be eligible for the NAFTA preference if they qualify to be marked as a good of Mexico and if they are wholly obtained or produced in the NAFTA territories or transformed in Mexico so that the non-originating material undergoes a change in tariff classification described in subdivision (t) to General Note 12, HTSUSA. For subheading 9404.90, HTSUSA, the appropriate subdivision (t) rule states that:

A change to subheading 9404.90 from any other chapter, except from headings 5007, 5111 through 5113, 5208 through 5212, 5309 through 5311, 5407 through 5408 or 5512 through 5516.

The cushions are made from originating and non-originating materials. The cotton woven fabric or the polypropylene nonwoven fabric used to make the shell of the form and the U.S. fiberfill were made in the NAFTA territories. When the cotton cushion covers leave Bangladesh and the polyester fiberfill leaves Korea, they are classified in subheadings 6304.93 and 5503.20, HTSUSA, respectively. As the non-originating cushion covers and fiberfill undergo the requisite change in tariff classification the cushions are eligible for the NAFTA preference. Assuming the cushions qualify to be marked as a good of Mexico, they are entitled to the special "MX" duty rate of Free, provided that a Certificate of Origin is completed and submitted in accordance with 19 CFR 181.11.

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 that "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) in pertinent part 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

9404.90 Except for goods of subheading 9404.90 provided for in paragraph (e)(2) of this section, the country of origin of a good classifiable under subheading 9404.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.

Subheading 9404.90.20 is not included in the paragraph (e)(2) exception to the above tariff shift rules. The cushions are made from two fabrics that are made in different countries. As the fabrics comprising the cushions are formed in more than one country, Section 102.21 (c)(2) is inapplicable.

Section 102.21(c)(3) states that, "Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) or (2) of this section":

(i) If the good was knit to shape, the country of origin of the good is the single country, territory, or insular possession in which the good was knit; or

(ii) Except for goods of heading 5609, 5807, 5811, 6213, 6214, 6301 through 6306, and 6308, and subheadings 6209.20.5040, 6307.10, 6307.90, and 9404.90, if the good was not knit to shape and the good was wholly assembled in a single country, territory, or insular possession, the country of origin of the good is the country, territory, or insular possession in which the good was wholly assembled.

As the subject merchandise is not knit and subheading 9404.90, HTSUSA, is excepted from provision (ii), Section 102.21 (c)(3) is inapplicable.

Section 102.21 (c)(4) states, "Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2) or (3) of this section, the country of origin of the good is the single country, territory or insular possession in which the most important assembly or manufacturing process occurred". In the case of the subject merchandise, the most important manufacturing process occurs at the time of fabric making. Basing the country of origin determination on the fabric making process as opposed to the assembly process carries out the clear intent of Section 334 as expressed in Section 334 (b)(2) and Part 102.21(c)(3)(ii). The fabrics that make up the cushions are sourced in more than one country. As no one fabric is more important than the other, a single country of origin determination cannot be made based on Section 102.21(c)(4).

Paragraph (c)(5) states that "Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1), (2), (3) or (4) of this section, the country of origin of the good is the last country, territory or insular possession in which an important assembly or manufacturing process occurred". Accordingly, in the case of the subject cushions, country of origin is conferred by the last country in which an important assembly or manufacturing process occurred, that is, Mexico.

HOLDING:

The country of origin of the cushions is Mexico. The cushions are entitled to the NAFTA "MX" duty rate of Free upon compliance with all applicable laws, regulations and agreements. They are not subject to quota or visa restrictions.

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 181.100(a)(2). This section 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 181 of the Customs Regulations (19 C.F.R. 181). Should it be subsequently determined that the information furnished is not complete and does not comply with 19 CFR 181.100(a)(2), 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.

This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.

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 John Hansen at 646-733-3043.

Sincerely,

Robert B. Swierupski
Director,

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