The tariff classification and status under the North American Free Trade Agreement (NAFTA), of women's robes from Mexico; substantial transformation

NY 896442 April 29, 1994 CLA-2-62:S:N:N5:360 896442 CATEGORY: Classification TARIFF NO.: 6208.91.1010 Lesley Krule I. APPEL CORPORATION 136 Madison Avenue New York, NY 10016 RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of women's robes from Mexico; substantial transformation Dear Ms. Krule: In your letter dated February 17, 1994, you requested a ruling on the status of women's robes from Mexico under the NAFTA. Style 32465 is a woman's robe constructed from 100% cotton flannel woven fabric manufactured in Korea. The long sleeved garment extends to mid-calf and features a full frontal opening secured by six snaps, a patch pocket located on the right side, a trapunto stitched yoke and piping inserted around the yoke and at the bottom of each sleeve. The sample will be returned to you as requested. You present two manufacturing scenarios for style 32645. In both instances the robe will be made from Korean fabric. In the first scenario, the Korean fabric will be cut and sewn in Mexico from the Korean fabric. In the second scenario, style 32645 will be cut into components in Guatemala and the finished robe will be assembled in Mexico. The applicable tariff provision for the robe will be 6208.91.1010, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for women's or girls' singlets and other undershirts...nightdresses, pajamas, negligees, bathrobes, dressing gowns and similar articles: Other: Of cotton: Bathrobes, dressing gowns and similar articles, women's. The general rate of duty will be 8.5% ad valorem. The merchandise does not qualify for preferential treatment under the NAFTA because the Korean fabric, which is a non-originating material used in the production of the goods, will not undergo the change in tariff classification required by General Note 12(t)/62.32, HTSUSA. In the first scenario, when style 32465 is cut and assembled in Mexico, it may be subject to a reduced rate of duty based upon the Tariff Preference Levels (TPL) established in Section XI, Additional US Note 3(b) up to the specified annual quantities listed in subdivision (g)(i) of note 3. Upon completion of the required documentation and up to the specified annual quantities, the robe may be eligible for the preferential rate of 7.7 % ad valorem. In the second scenario, you state that the Korean fabric for style 32465 will be cut into components in Guatemala and the finished robe will be assembled in Mexico. The simple assembly of those components into a completed article in Mexico does not constitute the required tariff shift required for heading 6208, HTS, (NAFTA Interim Regulations Section 102.20(k), Annex 311), therefore, the country of origin would not be Mexico. Furthermore, section 12.130 of the Customs Regulations (19 CFR 12.130) sets forth the principles of country of origin for textile and textile products which are currently used for all purposes, including duty and marking. Customs has held that cutting of fabric into garment pieces constitutes a substantial transformation of the fabric, resulting in the apparel pieces becoming a product of the country where the fabric is cut. The mere assembly of goods, entailing simple combining operations, trimming or joining together by sewing is not enough to substantially transform the components of an article into a new and different article of commerce. The sewing operation performed in Mexico involves the simple assembly of several cut pattern pieces. The sewing does not involve the complex sewing operation required when manufacturing a suit, suit jacket, or tailored shirt contemplated by section 12.130(e)(v). Therefore, the cutting of the Korean fabric into components in Guatemala is considered to be a substantial transformation of the fabric which creates a new and different article of commerce. The country of origin of the robe is Guatemala. Style 32645 falls within textile category designation 350. Based upon international textile trade agreements, products of Guatemala are subject to a visa requirement. The designated textile and apparel category may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected. Since part categories are subject to frequent renegotiations and changes, to obtain the most current information available, we suggest that you check, close to the time of shipment, the Status Report On Current Import Quotas (Restraint Levels), an internal issuance of the U.S. Customs Service, which is available for inspection at your local Customs office. This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181). A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is imported. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction. 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, Office of Regulations and Rulings, U.S. Customs Service, 1301 Constitution Ave. N.W., Franklin Court, Washington, D.C. 20229. Sincerely, Jean F. Maguire Area Director New York Seaport