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NY N006244




March 1, 2007

CLA-2-61:RR:NC:TAB:354

CATEGORY: CLASSIFICATION

TARIFF NO.: 6108.22.9020

Ms. Matilde G. Gutierrez
VF Intimates, LP
4600 W. Military Highway
McAllen, TX 78503

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a woman’s bikini panty from Mexico; Article 509

Dear Ms. Gutierrez:

In your letter dated December 9, 2007, you requested a ruling on the status of an underwear panty from Mexico under the NAFTA.

You have submitted a woman’s bikini panty, style #5306917, which will be retained by our office. You state that the panty will be cut and assembled in Mexico using fabrics and components that are formed in the United States, Mexico, and Costa Rica, using yarns formed in either Mexico or the U.S. The panty consists of a front center panel (identified as material no. J1140) made up of a rachel knit, or warp knit fabric that has a lace-like appearance, which is knit in Costa Rica and made of 93% nylon (from Mexico) and 7% spandex (from the U.S.). The front center panel is lined with a fabric that is knitted in the U.S. (identified as material no. 3048) using 87% nylon (from Mexico) and 13% spandex (from the U.S.). The back, sides, gusset crotch, and a small portion of either side of the front of the panty is made of a knitted openwork fabric that has a mesh-like appearance (identified as material no. 336) and is knit in the U.S. using 93% nylon (from Mexico) and 7% spandex (from the U.S.). The gusset crotch liner material is knit in the U.S. using 100% cotton from the U.S. The elastic waistband and elastic leg openings originate from the U.S.

You state that fabric 336 and 3048 will be sent to Mexico where cutting into component parts and assembly with the lace-like front center panel (material no. J1140) from Costa Rica, elastic from Mexico, the gusset crotch and thread (from the U.S.) will form the finished panties.

You state that the component that determines the tariff classification of this panty should be the fabric that makes up the back, sides, gusset crotch, and a portion of either side of the front (material no. 336), which is knit in the U.S. and cut into component parts in Mexico. You do not believe that classification should be based on the front center panel, made of the lace-like fabric that originates in Costa Rica (material no. J1140).

As the panty is made up of different fabrics, we must first decide which component imparts the essential character to this undergarment. Our analysis is aided by applying a set of classification guidelines set forth in Customs Headquarters Memorandum 084118, dated April 13, 1989. These guidelines state that, absent any unusual circumstances, the following criteria should be applied when classifying garments consisting of different fabrics:

For upper or lower body garments, if one component exceeds 60 percent of the visible surface area, that component will determine the classification of the garment unless the other component:
forms the entire front of the garment; or provides a visual and significant decorative effect (e.g. a substantial amount of lace); or is over 50 percent by weight of the garment; or is valued at more than 10 times the primary component.

In this regard, the essential character of the panty is imparted by the lace-like front center fabric panel, identified by material no. J1140, knitted in Costa Rica of 93% nylon (from Mexico) and 7% spandex (from the U.S.) since it provides a visual and significant decorative effect due to its location on the garment.

The applicable tariff provision for style #5306917 will be 6108.22.9020, Harmonized Tariff Schedule of the United States (HTSUS), which provides for women’s or girls’ slips, briefs, panties, nightdresses, pajamas, negligees, bathrobes, dressing gowns and similar articles, knitted or crocheted: briefs and panties: of man-made fibers: other, women’s. The general rate of duty will be 15.6% ad valorem.

Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.

General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that

For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--

(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or

(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--

(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or

(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or

(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or

(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--

(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or

(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.

For purposes of NAFTA determination, General Note 12(t), Chapter 61, Chapter rule 2 must also be applied. That rule states: For purposes of determining the origin of a good of this chapter, the rule applicable to that good shall only apply to the component that determines the tariff classification of the good, and such component must satisfy the tariff change requirements set out in the rule for that good. If the rule requires that the good must also satisfy the tariff change requirements for visible lining fabrics listed in chapter rule 1 for this chapter, such requirement shall only apply to the visible lining fabric in the main body of the garment, excluding sleeves, which covers the largest surface area, and shall not apply to removable linings.

Based on the above, the submitted panty does not qualify for preferential treatment under the NAFTA because the non-originating fabric that determines the classification of this article will not undergo the change in tariff classification required under General Note 12(t)/61.31, which states:

A change to subheading 6108.22 through 6108.29 from any other chapter, except from headings 5106 through 5113, 5204 through 5212, 5307 through 5308 or 5310 through 5311, chapter 54, or headings 5508 through 5516 or 6001 through 6006, provided that the good is both cut (or knit to shape) and sewn or otherwise assembled in the territory of one or more of the NAFTA parties.

The lace-like fabric that forms the center front portion of the panty (material no. J1140), which originates in Costa Rica, is classified in heading 6004, HTSUS, one of the excepted headings mentioned above. Therefore, the panties will not be eligible for NAFTA preference.

The panties may, however, be subject to a reduced rate of duty based upon the Tariff Preference Levels (TPL) established in Section XI, Additional U.S. Note 3(b), up to the annual quantities specified in subdivision (g)(i) of this note. Upon completion of the required documentation and up to the specified annual quantities, the panties may be eligible for the preferential rate of free.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).

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 Deborah Marinucci at 646-733-3054.

Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs and Border Protection, 1300 Pennsylvania Ave. N.W., (Mint Annex), Washington, D.C. 20229.

Sincerely,

Robert B. Swierupski
Director,

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