Classification and country of origin determination for undergarments; 19 CFR 102.21(c)(2); tariff shift

N022510 February 25, 2008 CLA2-OT:RR:NC:TAB:354 CATEGORY: Classification Mr. Jorge Zeledon O’Bryan Brothers Inc. 4256 West Belmont Avenue Chicago, IL 60641-4693 RE: Classification and country of origin determination for undergarments; 19 CFR 102.21(c)(2); tariff shift Dear Mr. Zeledon: This is in reply to your letter dated January 24, 2008, requesting a classification and country of origin determination for undergarments which will be imported into the United States. FACTS: The subject merchandise consists of seven styles of women’s undergarments that you state will feature the brand name “Cuddl Duds” made of lightweight knit fabric, which will be marketed and sold as base layer undergarments that provide thermal properties. All articles will be close-fitting and are designed to be worn against the skin under other clothing. As stated, seven samples were submitted with your request. For future requests, we ask that you limit the number of items to no more than five items of the same class or kind per ruling request. The manufacturing operations for the undergarments are as follows: You have indicated that the fabric for the undergarments will be made in China and shipped in rolls to a Qualifying Industrial Zone in Egypt, where cutting, sewing, and all assembly takes place. CLASSIFICATION: Style #P15080 is short sleeve undershirt made of 55% cotton, 45% nylon featuring a V-shaped neckline, a hemmed bottom, sewn on lace-like trim at the neck and arm openings, and a small satin bow sewn on the front center neckline. Style #P57780 is a pair of women’s matching long underpants made of 55% cotton, 45% nylon with a covered elasticized waistband and hemmed leg openings. Style #OB-742-2 is a mock neck long sleeve undershirt made of 90% polyester, 10% spandex with hemmed arm openings and a hemmed bottom. The arms are sewn to the body of the garment with flatlock seams. Style #OB-743-2 is a long sleeve undershirt made of 90% polyester, 10% spandex featuring a V-shaped neckline, hemmed arm openings and a hemmed bottom. The arms are sewn to the body of the garment with flatlock seams. Style #OB-744-2 is a pair of matching long underpants made of 90% polyester, 10% spandex, with a covered elasticized waistband, hemmed leg openings, a separately sewn-in gusset crotch panel, and flatlock seams. Style #1556-680 is a long sleeve undershirt made of 89% polyester, 11% spandex featuring a rounded neckline, with self-fabric capping at the neck and arm openings. Style #1776-681 is a pair of matching long underpants made of 89% polyester, 11% spandex, with a covered elasticized waistband and hemmed leg openings. The applicable subheading for style #P15080 will be 6109.10.0037, Harmonized Tariff Schedule of the United States (HTSUS), which provides for T-shirts, singlets, tank tops and similar articles, knitted or crocheted: of cotton, women’s or girls’: underwear. The duty rate will be 16.5% ad valorem. The applicable subheading for style #P57780 will be 6108.91.0005, HTSUS, which provides for women’s or girls’ slips, petticoats, briefs, panties, nightdresses, pajamas, negligees, bathrobes, dressing gowns and similar articles, knitted or crocheted: other: of cotton…underwear: underpants. The rate of duty will be 8.5% ad valorem. The applicable subheading for styles #OB-742-2, #OB-743-2, #1556-680 will be 6109.90.1075, HTSUS, which provides for T-shirts, singlets, tank tops and similar garments, knitted or crocheted: of other textile materials: of man-made fibers…women’s or girls’: thermal undershirts. The duty rate will be 32% ad valorem. The applicable subheading for styles #OB-744-2 and #1776-681 will be 6108.92.0005 which provides for women’s or girls’ slips, petticoats, briefs, panties, nightdresses, pajamas, negligees, bathrobes, dressing gowns and similar articles, knitted or crocheted: of other textile materials: of man-made fibers…women’s or girls’: thermal undershirts. The duty rate will be 16% 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/. COUNTRY OF ORIGIN - LAW AND ANALYSIS: General Note 3(a)(v)(G), HTSUS, defines a qualifying industrial zone” as any area that: (1) encompasses portions of the territory of Israel and Jordan or Israel and Egypt; (2) has been designated by local authorities as an enclave where merchandise may enter without payment of duty or excise taxes; and (3) has been designated by the U.S. Trade Representative in a notice published in the Federal Register as a qualifying industrial zone.” For purposes of this ruling, we will assume that the requirements of General Note 3(a)(v)(G), HTSUS, are satisfied and that the fabric is cut and sewn into garments in a QIZ. General Note 3(a)(v)(G), HTSUS, defines a “qualifying industrial zone” as any area that: “(1) encompasses portions of the territory of Israel and Jordan or Israel and Egypt; (2) has been designated by local authorities as an enclave (3) has been designated by the U.S. Trade Representative in a notice published in the Federal Register as a qualifying industrial zone.” Section 334 of the Uruguay Round Agreements Act (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provided rules of origin for textiles and apparel entered, or withdrawn from warehouse for consumption, on and after July 1, 1996. Section 102.21, Customs Regulations (19 C.F.R. 102.21), published September 5, 1995 in the Federal Register, implements Section 334 (60 FR 46188). Section 334 of the URAA was amended by section 405 of the Trade and Development Act of 2000, enacted on May 18, 2000, and accordingly, section 102.21 was amended (68 Fed. Reg. 8711). Thus, the country of origin of a textile or apparel product shall be determined by the sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21. Paragraph (c)(1) states, “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, “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, 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 6101-6117 (1) If the good is not knit to shape and consists of two or more component parts, except for goods of subheading 6117.10 provided for in paragraph (e)(2) of this section, a change to an assembled good of heading 6101 through 6117 from unassembled components, provided that the change is the result of the good being wholly assembled in a single country, territory, or insular possession. In the scenarios under consideration, the undergarments are not knit to shape and consist of two or more component parts. Therefore, the remaining issue that must be determined is whether the undergarments are “wholly assembled” in the QIZ. The term “wholly assembled” is defined in 19 C.F.R. 102.21(b)(6) as: Wholly assembled. The term “wholly assembled” when used with reference to a good means that all components, of which there must be at least two, preexisted in essentially the same condition as found in the finished good and were combined to form the finished good in a single country, territory, or insular possession. Minor attachments and minor embellishments (for example, appliqués, beads, spangles, embroidery, buttons) not appreciably affecting the identity of the good, and minor subassemblies (for example, collars, cuffs, plackets, pockets), will not affect the status of a good as “wholly assembled” in a single country, territory, or insular possession. Because the undergarments will consist of two or more component parts and will be wholly assembled in what we assume to be a qualifying QIZ, under 19 C.F.R. 102.21(e), the undergarments will be considered “products of” Egypt, where the QIZ is located, as per the terms of the tariff shift requirement. HOLDING: The country of origin of the undergarments is Egypt. 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 177.9(b)(1). 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 177 of the Customs Regulations (19 C.F.R. 177). Should it be subsequently determined that the information furnished is not complete and does not comply with 19 CFR 177.9(b)(1), 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 in accordance with 19 CFR 177.2. 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. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division