Request for ruling on pocket bag fabric under the DR-CAFTA

HQ H264873 July 6, 2015 OT:RR:CTF:VS H264873 CMR CATEGORY: Classification Ms. Maggie Sioui Metro 1 Lincoln Boulevard Suite 202 Rouses Point, NY 12979 RE: Request for ruling on pocket bag fabric under the DR-CAFTA Dear Ms. Sioui: This is in response to your request, dated May 4, 2015, for clarification on the pocket bag fabric rule under the Dominican Republic – Central America – United States Free Trade Agreement (DR-CAFTA). You submitted a sample garment to illustrate your question. FACTS: The sample garment is a men’s hooded outerwear jacket with long sleeves, two front zipper-closure pockets below the waist, a full front opening with a zipper closure, cord tightening feature for the hood and the bottom of the garment, and knit fabric cuffs. The outer shell of the garment is constructed from a 100% woven nylon fabric with an expanded polytetrafluoroethylene (ePTFE) membrane, i.e., a fabric of heading 5903 of the Harmonized Tariff Schedule of the United States (HTSUS) (textile fabrics impregnated, coated, covered or laminated with plastics, other than those of heading 5902 (tire cord fabric)). You indicate the garment is classified in subheading 6210.40.5020, HTSUS, as a garment, made up of fabric of heading 5903, specifically, a men’s anorak of man-made fibers. We agree with your classification. Your concern is with the pockets of the garments and specifically the materials used to make the front pockets. You indicate that the pockets are not formed using a traditional pocketing bag as such, but are constructed from three different materials, sewn together within the garment creating each pocket. The materials are identified as follows: Material #1 Taiwanese origin 100% woven nylon fabric, formed from Taiwanese origin yarn, used on the outer edge of the pocket (regarded by you as trim). Material #2 U.S. origin 100% woven nylon fabric formed from U.S. origin yarn. You indicate this fabric “is actually part of the inner liner, but has been sectioned off to create a ‘pocket,’ representing one side of the ‘pocket.’” Material #3 Taiwanese origin 100% polyester knit fabric, formed from Taiwanese origin yarn, representing the second side of the “pocket.” You ask: “If the pocket bag is made of the interior fabrics that are sewn together in the garment instead of a separate bag that is attached to the jacket, does this need to originate from a DR-CAFTA country?” In addition, you inquire as to whether there is a clear definition of a pocket bag fabric. ISSUE: Whether the garment at issue with pockets formed as described above, is subject to the pocket bag fabric rule set forth in Chapter Rule 5, Chapter 62, General Note 29, HTSUS. LAW AND ANALYSIS: The DR-CAFTA was signed by the governments of Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, Nicaragua, and the United States on August 5, 2004. It was approved by the U.S. Congress with the enactment on August 2, 2005, of the Dominican Republic-Central America-United States Free Trade Agreement Implementation Act (the Act), Pub. L. 109-53, 119 Stat. 462 (19 U.S.C. 4001 et seq.). General Note (GN) 29, HTSUS, implements the DR-CAFTA. GN 29(b), subject to the provisions of subdivisions (c), (d), (m) and (n) of GN 29, sets forth the criteria for determining whether a good (other than agricultural goods provided for in GN 29(a)(ii)) is an originating good for purposes of the DR-CAFTA. Pursuant to GN 29(b)(ii)(A), the rule set forth in GN(n) is examined for goods of heading 6210 along with several Chapter Rules which are set forth therein. Specifically at issue is Chapter Rule 5, Chapter 62, which references Chapter Rule 2 (i.e. the rule which states that only the component that determines the classification of the good must meet the applicable tariff shift rule (also known as the product specific rule)). Chapter Rule 5, Chapter 62, GN 29, sets forth a list of goods which are not subject to its rule. Goods of subheading 6210.40.50, HTSUS, are not excepted and therefore are subject to the rule which provides in relevant part: Notwithstanding chapter rule 2, a good of this chapter, other than— * * * that contains a pocket or pockets shall be considered originating only if the pocket bag fabric has been formed and finished in the territory of one or more of the parties to the Agreement from yarn wholly formed in the territory of one or more of the parties to the Agreement. The garment at issue cannot be considered originating unless the pocket bag fabric used to form the pockets has been formed and finished in the territory of one or more of the parties to the Agreement from yarn wholly formed in the territory of one or more of the parties to the Agreement. There is no clear definition of “pocket bag” fabric. However, in Headquarters Ruling Letter (HQ) H043056, dated May 5, 2009, CBP stated with regard to Chapter Rule 5, Chapter 61, GN 29: We conclude from the language of the rule that the types of pockets with which the rule is concerned are pockets in which pocketing fabric is shaped to form a bag. These are generally pockets in which the pocket bag is not visible as it is normally in the interior of the garment. Therefore, pockets such as cargo pockets, patch pockets and typical shirt pockets would not be subject to the rule. An example of the type of pockets that would be subject to the rule, i.e., pockets consisting of “bags”, would be typical dress trouser pockets and dress coat pockets. You attempt to distinguish the pockets in the garment at issue based on the manner in which they are formed, i.e., sewn to form a pocket bag, as opposed to a pre-existing pocket bag which is then sewn into the garment. Nothing in the language of GN 29 requires the pocket bag fabric to pre-exist in the form of a pocket prior to assembly in a garment and CBP does not read such a requirement in the statute. Provided that the fabric or, as in this case, fabrics are assembled to form a pocket bag, before or during assembly of the garment, the fabric (or fabrics) must meet the requirements of Chapter Rule 5, Chapter 62, GN 29. In this instance, all three materials are necessary to form the front pockets of the garments. After examining the construction of the sample garment and contrary to your description, the fabric identified as material #2 is actually not a part of the inner liner. Material #1, which you assert is more of a trim, forms part of the pocket bag and is therefore subject to the chapter rule. HOLDING: The garment in this case is subject to the pocket bag fabric rule in Chapter Rule 5, Chapter 62, GN 29, and will not qualify for preferential tariff treatment under the DR-CAFTA as the pocket bags which form the front pockets of the garment fail to meet the pocket bag fabric rule. Fabric or, as in this case, fabrics, which are assembled to form a pocket bag, before or during assembly of the garment, must meet the requirements of Chapter Rule 5, Chapter 62, GN 29 for a garment subject to the rule to qualify as an originating good under the DR-CAFTA. A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction. Sincerely, Monika R. Brenner, Chief Valuation and Special Programs Branch