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HQ W968375




November 13, 2006

CLA-2 RR:CTF:TCM W968375 BtB

CATEGORY: CLASSIFICATION

TARIFF NO.: 6110.20.2079

Arthur W. Bodek, Esq.
John A. Schoenig, Esq.
Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP 399 Park Avenue
25th Floor
New York, NY 10022-4877

RE: Classification of women’s pullover made in China; statistical note 6 to Chapter 61, HTSUSA; “knit to shape”

Dear Messrs. Bodek and Schoenig:

This is in reply to your letter dated August 11, 2006, to the Director of the Commercial Rulings Division, on behalf of Liz Claiborne, Inc., submitted pursuant to 19 C.F.R. §177, requesting the classification under the Harmonized Tariff Schedule of the United States Annotated (“HTSUSA”) of a certain women’s pullover made in China identified as “Style FIMU5558.”

FACTS:

Style FIMU5558 is a women’s v-neck long-sleeve pullover made of 70% cotton and 30% nylon. It features plastic gemstones of various sizes and shapes bordered with plastic small beads along the neckline. The garment is made up of two sleeves, a front panel, a back panel and a length of neckline capping fabric. You state that each of these components is knit to shape on a flat-knitting machine. You also state that the components are assembled together by linking and looping. You provided a sample of Style FIMU5558 in finished form, as well as samples of each of its components.

The front and back panels are knit to shape with self-start bottoms, self-finished sides, shaped armholes, and clear and continuous lines of demarcation for the neckline. The sleeves have self-start bottoms and self-finished sides. The cap area of each sleeve is finished with waste yarn. The neckline capping fabric is a piece of fabric that has only two finished sides and does not have a self-start bottom. In regard to the neckline capping, you state: When it is attached to the garment, it is simply folded in half and linked and looped to the front and back panels. The waste yarn is only subjected to incidental trimming in the course of the linking and looping process. Significantly, the component requires no intermediate trimming or cutting operations between the time it comes off the knitting machine and the time it is linked and looped onto the garment.

The stitch count of the garment, measured on the outer surface of the garment’s fabric in the direction in which the stitches are formed, exceeds 9 stitches per 2 centimeters, but is less than or equal to 18 stitches per 2 centimeters. Style FIMU5558 is made in China.

In your letter, you assert that Style FIMU5558 is a “knit to shape” article described by statistical note 6 to Chapter 61, HTSUSA, and is classifiable in subheading 6110.20.2077, HTSUSA, which provides for: “Sweaters, pullovers, sweatshirts, waistcoats (vests) and similar articles, knitted or crocheted: Of cotton: Other, Other: Other: Women’s or girls’: Knit to shape articles described in statistical note 6 to this chapter.”

ISSUE:

Is Style FIMU5558 a “knit to shape” article described by statistical note 6 to Chapter 61, HTSUSA?

What is the classification of Style FIMU5558?

LAW AND ANALYSIS:

Classification under the HTSUSA is made in accordance with the General Rules of Interpretation (“GRI”). GRI 1 provides, in part, that classification decisions are to be "determined according to the terms of the headings and any relative section or chapter notes." If the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI may then be applied, in order.

The Harmonized Commodity Description and Coding System Explanatory Notes (“EN”) constitute the official interpretation of the Harmonized System at the international level (for the 4 digit headings and the 6 digit subheadings) and facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI. While neither legally binding nor dispositive of classification issues, the EN provide commentary on the scope of each heading of the HTSUSA and are generally indicative of the proper interpretation of the headings. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989).

Heading 6110, HTSUSA, provides for: “Sweaters, pullovers, sweatshirts, waistcoats (vests) and similar articles, knitted or crocheted.” The EN to heading 6110, in pertinent part, state that the heading covers “ a category of knitted or crocheted articles, without distinction between male or female wear, designed to cover the upper parts of the body (jerseys, pullovers, cardigans, waistcoats and similar articles).” Style FIMU5558 is a knit garment designed to cover a woman’s upper body. Due to the garment’s fabric and construction, we find Style FIMU5558 to be clearly provided for as a pullover by heading 6110, HTSUSA. You do not dispute classification of Style FIMU5558 in this heading.

As we have determined that Style FIMU5558 is classified in heading 6110, HTSUSA, we turn to the garment’s classification at the subheading level, which is made in accordance with GRI 6, which states:

For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.

Style FIMU5558 is provided for as a “pullover” by heading 6110. It cannot be considered a “sweater” at the statistical level because it has a stitch count greater than 9 stitches per 2 centimeters measured on the outer surface of the fabric in the direction in which the stitches are formed. See statistical note 3 to Chapter 61, HTSUSA, which sets forth stitch requirements for sweaters at the statistical level.

In this case, based on the garment’s material and construction, Style FIMU5558 is clearly classified to the 8-digit level. The garment is 70% cotton and 30% nylon. Under Subheading Note 2(A) to Section XI, HTSUSA, Style FIMU5558 is regarded as consisting wholly of cotton because that material predominates by weight in the product. It is therefore classified in subheading 6110.20, HTSUSA, as “of cotton,” at the 6-digit level.

It is also apparent that Style FIMU5558 is described at the 8-digit level by subheading 6110.20.20, HTSUSA (“Other”) because no other 8-digit level subheading describes the garment. You do not dispute classification of Style FIMU5558 in this subheading.

The subheadings under consideration for classification of Style FIMU5558 at the 9 and 10-digit level (the statistical level) are: subheading 6110.20.2077, HTSUSA, which provides for: “Knit to shape articles described in statistical note 6 to [Chapter 61, HTSUSA]” and subheading 6110.20.2079, HTSUSA, which provides for: “Other.”

The determinative issue regarding classification of the garment at the statistical level is whether Style FIMU5558 is a “knit to shape” article described in statistical note 6 to Chapter 61, HTSUSA, which states:

For the purposes of statistical reporting under heading 6110, the term "knit to shape" means garments knit to shape on flat-knitting machines, having a stitch count exceeding 9 stitches per 2 centimeters, but less than or equal to 18 stitches per 2 centimeters, measured on the outer surface of the fabric, in the direction in which the stitches are formed. For purposes of this statistical note, in the instances where both knit and purl stitches are usually counted, the purl stitches will be disregarded, and only the knit stitches on the outer surface of the fabric will be counted. All of the garment's components, which include, but are not limited to, collars, plackets, cuffs, waistbands and pockets, are knit to shape. All of the components are assembled by looping and linking, including the side seams.

Based on our thorough review of the garment, we find that Style FIMU5558 is not a “knit to shape article” described by statistical note 6 to Chapter 61, HTSUSA. Four components do meet the knit to shape requirements of the note. The front and back panels are knit to shape. Both sleeves also are knit to shape. Note that while the cap area of each sleeve is finished with waste yarn, this is an allowable exception to the knit to shape requirement of the component pieces of a garment. Additionally, the plastic gemstones and beads along the neckline are allowable, as they are not components.

However, the neckline capping is not knit to shape under the note. The neckline capping of Style FIMU5558 is a component of the garment for purposes of statistical note 6 and, in order to be acceptable under the note, it must be knit to shape with a self-start bottom and self-finished sides. However, it has only two self-finished sides and no self-start bottom. Additionally, the trimming, or cutting, that is performed on the component is not acceptable, as cutting of components is generally not acceptable. Consequently, the neckline capping is not knit to shape and Style FIMU5558 does not meet the description set forth in statistical note 6 to Chapter 61, HTSUSA. The garment is, therefore, not provided for by subheading 6110.20.2077, HTSUSA. Rather, it is specifically provided for by subheading 6110.20.2079, HTSUSA.

As you know, the Memorandum of Understanding (“MOU”) between the United States of America and the People’s Republic of China, implemented on January 1, 2006, for goods exported on or after that date through December 31, 2008, allows for the exclusion from quota of knit to shape articles made in China classified in certain 10-digit reporting numbers (the statistical level). While these Chinese-origin articles are covered by certain textile categories, they are not subject to quota. Nevertheless, garments made in China that do not meet the requirements of statistical note 6 to Chapter 61, HTSUSA, are not classified in any of the certain 10-digit reporting numbers referred to above and may be subject to quota.

In your letter, you assert that “treatment of minor trim components which are knit to length with waste yarn at their top and bottom dimensions as knit to shape for purposes of this quota exemption would be consistent with industry practice and would not conflict with the terms of the MOU.” You also argue that the note is overly restrictive.

We do not agree with your assertions. Annex II of the MOU, which describes the products excluded from quota coverage, does not differentiate between minor and major components. Rather, it mandates that “all of the components” of a garment be knit to shape for the garment to be eligible for the exclusion from quota under the MOU. While CBP has focused on “major parts” of a garment for country of origin purposes under 19 C.F.R. § 102.21, all components are considered in evaluating whether a garment is knit to shape under statistical note 6 to Chapter 61, HTSUSA. The note is intended to be restrictive, barring garments that do not meet its terms from classification in certain statistical provisions in heading 6110. Interpreting the note as you suggest would be in conflict with the direct terms and spirit of the MOU.

HOLDING:

The certain women’s v-neck long-sleeve pullover made of 70% cotton and 30% nylon identified as “Style FIMU5558” is classified in subheading 6110.20.2079, HTSUSA, which provides for: “Sweaters, pullovers, sweatshirts, waistcoats (vests) and similar articles, knitted or crocheted: Of cotton: Other, Other: Other: Women’s or girls’: Other.” The garment falls into textile category 339. The applicable column one general rate of duty under the 2006 HTSUSA is 16.5% ad valorem.

Quota/visa requirements are no longer applicable for merchandise which is the product of World Trade Organization (“WTO”) member countries. The textile category number above applies to merchandise produced in non-WTO member countries. Quota and visa requirements are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information on quota and visa requirements applicable to this merchandise, we suggest you check, close to the time of shipment, the “Textile Status Report for Absolute Quotas” which is available on our web site at www.cbp.gov. For current information regarding possible textile safeguard actions on goods from China and related issues, we refer you to the web site of the Office of Textiles and Apparel of the Department of Commerce at otexa.ita.doc.gov.

Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUSA and the accompanying duty rates are provided on the world wide web at www.usitc.gov.

Sincerely,

Gail A. Hamill, Chief

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