Classification and country of origin determination for women’s pants and pvc belts; Status under the United States-Jordan Free Trade Agreement (JFTA); Products of the West Bank, the Gaza Strip or a Qualifying Industrial Zone; General Note 3(a)(v); 19 CFR 102.21(c)(2);

N194017 December 21, 2011 CLA-2-RR:NC:TA:N3:348 CATEGORY: Classification TARIFF NO.: 6204.62.4011; 6204.62.4021; 3926.20.9050 Mr. Arthur W. Bodek Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP 399 Park Avenue, 25th Floor New York, NY 10022-4877 RE: Classification and country of origin determination for women’s pants and pvc belts; Status under the United States-Jordan Free Trade Agreement (JFTA); Products of the West Bank, the Gaza Strip or a Qualifying Industrial Zone; General Note 3(a)(v); 19 CFR 102.21(c)(2); Dear Mr. Bodek: The subject merchandise consists of pants and belts. The classification of this item was the subject of New York Ruling Letter N188775, dated November 7, 2011. Samples were submitted with your current ruling request. In ruling N188775, the merchandise was described as follows: The submitted sample, style 60012804-F00 (pants), is a pair of women’s pants constructed of 75 percent cotton, 23 percent polyester and 2 percent spandex twill woven fabric. The indigo colored garment features a flat elasticized waistband with a button closure; 6 belt loops; two rear patch pockets; two front pockets and one embroidered coin pocket; a zipper fly opening; and hemmed leg openings. The submitted sample, style 60014787-A29 (pants), is a pair of women’s pants constructed of 98 percent cotton and 2 percent spandex twill woven fabric. The garment features a flat elasticized waistband with a button closure; 6 belt loops; two rear patch pockets; two front pockets and one embroidered coin pocket; a zipper fly opening; and hemmed leg openings. The submitted sample, style #60012804-F00 (belt), is a fashion accessory belt. It is composed of PVC plastic. The belt measures approximately 36 inches long and ¾ inches wide and features a metal buckle. The submitted sample, style #60014787-A29 (belt), is a fashion accessory belt. It is composed of PVC plastic. The belt measures approximately 40 inches long and 1 ¼ inches wide. It features a metal buckle and a cutout pattern along the length of the belt. You state the pants and belts will be shipped to the United States on the same vessel. You present two different packaging scenarios and suggest that the pants and belt in these scenarios be classified separately. Scenario 1: The pants will be packaged in bulk quantities. The belts will be separately packed in a different set of bulk packaging. Upon importation the belts will be threaded through the belt loops of the corresponding pair of pants and made suitable for retail sale as a set. Scenario 2: The pants will be packaged in bulk quantities. The belts will also be packed in the same bulk packaging. However, the belts will not be threaded through the belt loops nor combined in any way. Upon importation the belts will be threaded through the belt loops of the corresponding pair of pants and made suitable for retail sale as a set. For each of these scenarios, NY Ruling Letter N188775 classified the pants and belts separately as follows. The applicable subheading for style 60012804-F00 (pants) will be 6204.62.4011, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Women’s trousers (other than swimwear): Of cotton: Other: Other: Other: Other: Trousers: Women’s: Blue denim. The duty rate will be 16.6% ad valorem. The applicable subheading for style 60014787-A29 (pants) will be 6204.62.4021, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Women’s trousers (other than swimwear): Of cotton: Other: Other: Other: Other: Trousers: Women’s: Other. The duty rate will be 16.6% ad valorem. The applicable subheading for Styles #60012804-F00 (belt) and #60014787-A29 (belt) will be 3926.20.9050, Harmonized Tariff Schedule of the United States (HTSUS), which provides for other articles of plastic and articles of other materials of headings 3901 to 3914: articles of apparel and clothing accessories:…other: other, other. The rate of duty will be 5%. You now ask for the classification and country of origin determination under the United States-Jordan FTA or a Qualifying Industrial Zone. The manufacturing operations for the pants and belts are as follows: SCENARIO A: CHINA: The fabric for the pants is woven and is sent in rolls to Jordan. PVC belts are produced and sent to Jordan. ISRAEL/Asia/China: Trimmings such as zippers or buttons are produced and sent to Jordan. JORDAN The fabric for the pants are cut into components, sewn and assembled into completed garments. The garment is finished and packed for export directly to the United States. The PVC belt is not attached or combined with the pants. The belts are shipped to U.S. in bulk and exported directly to the United States. SCENARIO B: CHINA: The fabric for the pants is woven and is sent in rolls to Egypt. PVC belts are produced and sent to Egypt. ISRAEL: - Trimmings such as zippers or buttons are produced and sent to Egypt EGYPT (QIZ): The fabric for the pants are cut into components, sewn and assembled into completed garments. The garment is finished and packed for export directly to the United States. The PVC belt is not attached or combined with the pants. The belts are shipped to U.S. in bulk and exported directly to the United States. . COUNTRY OF ORIGIN - LAW AND ANALYSIS: 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. Section 102.21, paragraph (c)(1) states that "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 that "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 that "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 6201-6208 If the good consists of two or more component parts, a change to an assembled good of heading 6201 through 6208 from unassembled components, provided that the change is the result of the good being wholly assembled in a single country, territory, or insular possession. As the garment consists of two or more component parts, and is wholly assembled in a single country, that is Jordan for Scenario A and Egypt for Scenario B, the terms of the tariff shift are met. The country of origin for the pants is conferred in Jordan for Scenario A and Egypt, QIZ, for Scenario B. STATUS UNDER THE UNITED STATES-JORDAN FREE TRADE AGREEMENT. General Note 18(b), HTSUS, sets forth the criteria for determining whether goods (other than a textile or apparel article) are eligible for treatment as “products of Jordan” under the JFTA. General Note 18(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that For purposes of this note, subject to the provisions of subdivisions (d) and (e), goods imported into the customs territory of the United States are eligible for treatment as “products of Jordan” only if– (i) such goods are imported directly from Jordan into the customs territory of the United States, and (ii) they are– (A) wholly the growth, product or manufacture of Jordan, or (B) new or different articles of commerce that have been grown, produced or manufactured in Jordan and meet the requirements of subdivision (c) of this note. Based on the facts provided, the pants in Scenario A will be imported directly from Jordan into the customs territory of the United States, and will be new or different articles of commerce that have been grown, produced or manufactured in Jordan. Therefore, the pants may be eligible for the “special” duty rate if, upon importation, information is provided to indicate that the goods meet the requirements of HTSUS General Note 18(c). The belts are manufactured into a finished good in China and are considered a product of China. Therefore, the belts do not meet the requirements of HTSUS General Note 18(c) and will not be eligible for the “special” duty rate. STATUS UNDER THE UNITED STATES-ISRAEL FREE TRADE AGREEMENT. Pursuant to the authority conferred by section 9 of the U.S. - Israel Free Trade Area Implementation Act of 1985 (19 U.S.C § 2112 note), the President issued Proclamation No. 6955 dated November 13, 1996 (published in the Federal Register on November 18, 1996 (61 Fed. Reg. 58761)), which modified the Harmonized Tariff Schedule of the United States (HTSUS) by creating a new General Note 3 (a)(v)) to provide duty-free treatment to articles which are the product of the West Bank, Gaza Strip or a qualifying industrial zone (QIZ), provided certain requirements are met. Such treatment was effective for products of the West Bank, Gaza Strip or a qualifying industrial zone entered or withdrawn from warehouse for consumption on or after November 21, 1996. You state that the processing operations will be performed in a QIZ in Egypt for Scenario B. 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.” Presidential Proclamation 6955 delegated to the United States Trade Representative the authority to designate qualifying industrial zones. See GN 3(a)(v)(G)(3), supra. The governments of Israel and Egypt jointly requested the designation as a qualifying industrial zone of areas comprising a Greater Cairo zone, Alexandria zone, Suez Canal zone and Central Delta zone. The names and locations of the factories comprising these four zones were specified on maps and materials submitted by Egypt and Israel and on file with the Office of the U.S. Trade Representative. For the purposes of this letter, we have determined that the QIZ you are using to produce the garments will meet the requirements of General Note 3(a)(v)(G), HTSUS. Under General Note 3 (a)(v), HTSUS, articles the products of the West Bank, Gaza Strip or a QIZ which are imported directly to the United States from the West Bank, Gaza Strip, a QIZ or Israel, qualify for duty-free treatment, provided the sum of (1) the cost or value of materials produced in the West Bank, Gaza Strip, or QIZ or Israel, plus (2) the direct costs of processing operations performed in the West Bank, Gaza Strip, a QIZ or Israel, is not less than 35% of the appraised value of such articles when imported into the United States. An article is considered to be a product of the West Bank, Gaza Strip, or a QIZ if it is either wholly the growth, product or manufacture of one of those areas or a new and different article of commerce that has been grown, produced or manufactured in one of those areas. With respect to the requirement that the articles be imported directly, General Note 3(a)(v) (B)(1) provides that: Articles are “imported directly” for purposes of this paragraph if: (1) they are shipped directly from the West Bank, the Gaza Strip, a qualifying industrial zone or Israel into the United States without passing through the territory of any intermediate country; You have stated in your letter that the pants in Scenarios B will be imported directly from the QIZ to the United States. You also stated the 35% value content requirement for the pants will be met. However, a determination will be made at the time of entry of the merchandise into the United States, whether the above requirements are met. Based upon the information submitted, the pants in Scenario B will be considered a product of the Qualifying Industrial Zone and will be eligible for preferential duty treatment under General Note 3 (a)(v), HTSUS, assuming that the garments are imported directly from the Qualifying Industrial Zone to the United States and the 35% value content requirement is satisfied. A determination will be made at the time of entry of the merchandise into the United States, whether the above requirements are met. The belts are manufactured into a finished good in China and are considered a product of China. Therefore, the belts do not meet the requirements of HTSUS General Note 3(a)(v) and will not be eligible for the “special” duty rate. 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 this ruling, contact National Import Specialist Rosemarie Hayward at 646-733-3064. Sincerely, Robert B. Swierupski, Director National Commodity Specialist Division