The status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA), of gloves from Honduras

N300466 October 4, 2018 CLA-2-61:OT:RR:NC:N3:354 CATEGORY: Classification TARIFF NO.: 6116.10.5520 Ms. Sandra Tovar CST, Inc. 500 Lanier Ave., W. Suite 901 Fayetteville, GA 30214 RE: The status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA), of gloves from Honduras Dear Ms. Tovar: In your letters dated August 31, 2018 and July 9, 2018 you requested a ruling on the status of gloves from Honduras under the DR-CAFTA on behalf of your client, Wells Lamont Industry. A sample of the finished gloves, Style Cut 2 Flextec, and sample of the gloves before the coating is applied as well as yarns used in the production of the knit to shape gloves were submitted. The finished glove, Style Cut 2 Flextec, is a polyurethane dipped, knit work glove constructed of 51% polyethylene, 35% nylon, 12% elastane, and 2% polyester. The polyurethane coating is on the outer surface and covers the entire palm, a portion of the front cuff and, also, overlaps the backside fingertips and sides of the wearer’s hand and fingers. The gloves feature an elasticized cuff and a contrasting color trim at the bottom of the cuff. You have indicated that the yarns of the glove make up 84% of the weight of the glove and the polyurethane coating makes up 16% of the weight, therefore, the weight of the textiles is more than 50% of the weight of the glove. The applicable tariff provision for the gloves will be 6116.10.5520 Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Gloves, mittens and mitts, knitted or crocheted: Impregnated, coated or covered with plastics or rubber: Other: Without fourchettes: Other: Containing 50 percent of more by weight of cotton, made-made fibers or other textile fibers, or any combination thereof: Subject to man-made fiber restraints”. The general rate of duty will be 13.2% percent ad valorem. You have requested a determination under the DR-CAFTA. The manufacturing operations are as follows: In the U.S. or Honduras, polyethylene yarns from China, nylon yarns from the U.S. and elastane yarns from the U.S. undergo a gimping process. The glove is knit to shape in Honduras using the gimped yarn with the addition of two different yarns for the wrist of the knit glove. Both of the yarns used in the knitting of the wrist of the gloves are elastane and polyester blends and are of U.S. origin. After knitting, the gloves are dipped in polyurethane or other latex product of foreign origin. As the gimped yarn consists of yarns from two countries, China and the U.S., a determination must be made in regard to the country of origin. As per HQ 952801: “Where for the purposes of our international textile agreements, a determination must be made in regard to the country of origin of a composite article comprised of components of different countries, where the joining of the components is not sufficient to confer origin, the origin of the article will be determined by the component which would be selected under GRI 3, HTSUSA, as being determinative of classification. GRI 3(c) provides: When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.” With regard to the gimped yarn, all three yarns are necessary to create the gimping effect and create the necessary properties of the yarn, i.e., flexibility from the elastane and strength and durability from the nylon and polyethylene yarns. Each component equally imparts the essential character. As a result, we must apply GRI 3(c). Polyethylene yarns of China (non-originating) are classified at 5402.49, HTSUS, textured nylon yarns of U.S. origin are classified at 5402.31, HTSUS, and elastane yarns of U.S. origin are classified at 5402.44 HTSUS. These three yarns undergo a gimping process (spiral wrap) in either Honduras or the U.S. The resulting gimped yarn is classified in heading 5606. Since the polyethylene yarns are last in numerical order in the HTSUS, the country of origin of the gimped yarn is China. General Note 29, HTSUS, sets forth the criteria for determining whether a good is originating under the DR-CAFTA. General Note 29(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that For the purposes of this note, subject to the provisions of subdivisions (c), (d), (m) and (n) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good under the terms of this note if— the good is a good wholly obtained or produced entirely in the territory of one or more of the parties to the Agreement; (ii) the good was produced entirely in the territory of one or more of the parties to the Agreement, and— (A) each of the nonoriginating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (n) of this note; or (B) the good otherwise satisfies any applicable regional value content or other requirements specified in subdivision (n) of this note; and the good satisfies all other applicable requirements of this note; or (iii) the good was produced entirely in the territory of one or more of the parties to the Agreement exclusively from originating materials. General Note 29 (n), HTSUS, states in subdivision (61) (38) that a material of foreign origin may qualify under CAFTA if each nonoriginating material used in the production of the good undergoes the following change in tariff classification: A change to headings 6114 through 6116 from any other chapter, except from headings 5111 through 5113, 5204 through 5212, 5310 through 5311, chapter 54, headings 5508 through 5516 or 6001 through 6006, provided that the good is cut or knit to shape, or both, and sewn or otherwise assembled in the territory of one or more of the parties. The non-originating materials, the gimped yarn classified under heading 5606, HTSUS, and the polyurethane classified in Chapter 39, HTSUS, both meet the terms of the tariff shift. General Note 29(d)(i)(B), HTSUS, also states in pertinent part, A textile or apparel good containing elastomeric yarns in the component of the good that determines the tariff classification of the good shall be considered to be an originating good only if such yarns are wholly formed in the territory of a party to the Agreement. The elastane yarn, used in the component that determines the classification, is formed in the U.S. Based on the facts provided, the gloves qualify for DR-CAFTA preferential treatment because they meet the requirements of HTSUS General Note 29(b)(ii)(A). The nonoriginating materials meet the terms of the tariff shift and the construction of the gloves meets the knit to shape requirement. The gloves will be entitled to a free rate of duty under the DR-CAFTA upon compliance with all applicable laws, regulations and agreements. 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/. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). 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 Karen Sikorski at karen.sikorski@cbp.dhs.gov. Sincerely, Steven A. Mack Director National Commodity Specialist Division