Classification, country of origin and marking determination for a children’s hooded bath towel; 19 CFR 102.21(c)(5); last important assembly or manufacturing process

N351110 August 6, 2025 OT:RR:NC:N2:349 CATEGORY: Classification, Origin, Marking TARIFF NO.: 6302.60.0020; 9903.01.25 Ms. Emily Cashman Latham Companies, LLC 124 Venture Court, Suite 1 Lexington, KY 40511 RE: Classification, country of origin and marking determination for a children’s hooded bath towel; 19 CFR 102.21(c)(5); last important assembly or manufacturing process Dear Ms. Cashman: This is in reply to your letter dated July 8, 2025, requesting a classification and country of origin determination for a children’s hooded bath towel, which will be imported into the United States. A marked sample of the product was provided to this office and will be retained for training purposes. FACTS: The subject merchandise, identified as “Everykid Towel (EKT),” is a children’s hooded bath towel that measures approximately 36 × 54 inches. The body of the towel is made of a 100 percent cotton woven terry toweling fabric with a dobby border. Both sides of the towel have uncut (loop) pile. The towel features a hood sewn onto the center of one of the long sides that is constructed in two layers: the outer surface is composed 100 percent cotton pique woven fabric; it is backed with 100 percent cotton terry toweling fabric. In addition, the hood features an embroidered duck wearing a cone hat and riding roller skates on the front, a printed striped hanging loop on the back and printed binding on the front edges of the hood. You state the binding and hanging loop fabric will be either 100 percent cotton seersucker fabric or 65 percent polyester and 35 percent cotton broadcloth. The hood is used to cover the child’s head after bathing or swimming while the rest of the towel is used to dry off or cover the body. The children’s hooded bath towel is imported for retail sale, packaged with a ribbon bow and paper tag on the front, and marketed under 3 Marthas® brand. The manufacturing operations for the children’s hooded bath towel are as follows: India: Terry toweling fabric is formed. Terry toweling fabric is cut and hemmed to make a finished rectangular towel. Finished towels are packaged and shipped to United States. United States: The finished towels are imported from India and duties paid. The towels are exported for further processing to El Salvador. Guatemala: Main labels are formed. Cotton seersucker binding fabric is formed. Cotton terry fabric for lining the hood is formed. Cotton terry fabric for lining the hood, binding fabric and labels are exported to El Salvador. El Salvador: Cotton pique woven fabric (outer surface of hood) is formed. Broadcloth printed binding fabric is formed. Polyester thread and ribbon are formed. Hood fabrics are cut to shape and sewn together to form the hood. Binding is sewn to edge of hood and loop to back of hood. Finished hood is assembled by sewing to the center of one of the long sides of the towel. Label is sewn to towel. Finished hooded children bath towel is packaged and shipped to United States. ISSUE: What are the classification and country of origin of the subject merchandise? Does the proposed marking, “Made in India, Finished in El Salvador,” meet the marking requirements under 19 U.S.C. 1304? CLASSIFICATION: The applicable subheading for the children’s hooded bath towel described as “Everykid towel (EKT)” will be 6302.60.0020, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Toilet linen and kitchen linen, of terry toweling or similar terry fabrics, of cotton: Towels: Other.” The rate of duty will be 9.1 percent ad valorem. Your request also concerns the eligibility of the finished children’s hooded bath towel under subheading 9802.00.5060, HTSUS, which provides for “Articles returned to the United States after having been exported to be advanced in value or improved in condition by any process of manufacture or by other means, articles exported for repair or alteration, other, other, other.” We find that this provision does not apply to the circumstances presented. The provision for repairs and alterations does not apply to the continuation of a manufacturing operation. In Doliff & Company v. The United States, 78 CCPA77, CAD 1225 (1979), the Court considered whether U.S. produced greige fabric which was exported to Canada and processed by scouring, dyeing and finishing should be granted partial duty relief under the provision for repairs or alterations. The Court found that this provision did not apply and observed: “...repairs and alterations are made to completed articles and do not include intermediate processing operations which are performed as a matter of course in the preparation or manufacture of finished articles.” In Guardian Industries Corporation v. United States, 3 CIT 9, Slip-op 82-4 (1982), the Court ruled that a process that makes a product suitable for its intended use was beyond the scope of alterations as that term is used in subheading 9802.00.50, HTSUS. Consequently, in the situation before us, we find that the assembly of the hood and its assembly to the towel in El Salvador is a continuation of the manufacture of a hooded towel, a commercially different article than a rectangular shaped bath towel. Further, following the principles of the court cases in Guardian, Supra and Doliff, Supra, the cutting to shape of the hood and assembly is beyond the scope of the provision for repairs and alterations. Therefore, a duty exemption is not allowed under 9802.00.50, HTSUS. COUNTRY OF ORIGIN - LAW AND ANALYSIS: Section 334 of the Uruguay Round Agreements Act (“URAA”) (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provides the rules of origin for textiles and apparel products for purposes of the customs laws and the administration of quantitative restrictions, unless otherwise provided by the statute, entered, or withdrawn from warehouse, for consumption on or after July 1, 1996. Section 3592 has been described as Congress’s expression of substantial transformation as it relates to textile and apparel products. Section 102.21 of the Code of Federal Regulations (19 CFR 102.21), implements the URAA. 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. See 19 CFR 102.21(c). 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 6301-6306 Except for goods of heading 6302 through 6304 provided for in paragraph (e)(2) of this section, the country of origin of a good classifiable under heading 6301 through 6306 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process. The “fabric-making process” is defined in 19 CFR 102.21(b)(2) as “any manufacturing operation that begins with polymers, fibers, filaments (including strips), yarns, twine, cordage, rope, or fabric strips and results in a textile fabric.” Subheading 6302.60 is not provided for in paragraph (e)(2) exception to the above tariff shift rule. As the subject merchandise is made of fabric formed by the fabric-making process in more than a single country, territory or insular possession, paragraph (c)(2) of Section 102.21 is inapplicable. Section 102.21 (c)(3) states, Where the country of origin of a textile or apparel product cannot be determined under paragraph (c) (1) or (2) of this section: (i) If the good was knit to shape, the country of origin of the good is the single country, territory, or insular possession in which the good was knit; or (ii) Except for fabrics of chapter 59 and goods of headings 5609, 5807, 5811, 6213, 6214, 6301 through 6306, and 6308, and subheadings 6307.10, 6307.90, 9404.90, and 9619.00.31-33 if the good was not knit to shape and the good was wholly assembled in a single country, territory, or insular possession, the country of origin of the good is the country, territory, or insular possession in which the good was wholly assembled. As the children’s hooded bath towel is not knit to shape, paragraph (e)(3)(i) of Section 102.21 is inapplicable and as the heading under which the hooded bath towel is classified is listed among the exceptions in paragraph (e)(3)(ii), paragraph (c)(3) of Section 102.21 is inapplicable. Paragraph (c)(4) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c) (1), (2) or (3) of this section, the country of origin of the good is the single country, territory, or insular possession in which the most important assembly or manufacturing process occurred.” In the case of the subject merchandise, it is our opinion that the fabric-making process of the terry toweling constitutes the most important assembly or manufacturing process. However, the terry toweling was not formed by the fabric-making process in a single country, territory or insular possession; the body of the towel was formed in India and the cotton terry fabric forming the hood was formed by the fabric-making process in Guatemala. As the most important manufacturing process occurs in more than a single country, territory or insular possession, paragraph (c)(4) of Section 102.21 is inapplicable. Paragraph (c)(5) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c) (1), (2), (3) or (4) of this section, the country of origin of the good is the last country, territory, or insular possession in which an important assembly or manufacturing process occurred.” Accordingly, in the case of the subject children’s hooded bath towel, the country of origin is conferred by the last country in which an important assembly or manufacturing process occurred, that is, El Salvador. MARKING: The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article. The submitted sample is marked “Made in India, Finished in El Salvador.” Since this proposed marking is in direct conflict with the origin determination made pursuant to Section 102.21, it does not satisfy the marking requirements of 19 U.S.C. 1304 and, thus, is not an acceptable country of origin marking for the finished children’s hooded bath towel. As country of origin is conferred in El Salvador, pursuant to 19 U.S.C. 1304, the hooded children’s bath towel must be marked to indicate that the country of origin is El Salvador, e.g., “Made in El Salvador.” HOLDING: The classification of the children’s hooded bath towel, described as “Everykid towel (EKT),” is 6302.60.0020, HTSUS. The towel is not eligible for a partial or complete duty exemption under 9802.00.5060, HTSUS. The country of origin is El Salvador pursuant of 102.21(c)(5). The proposed marking, “Made in India, Finished in El Salvador,” is not an acceptable country of origin marking for the hooded bath towel. The towels must be marked to indicate that the country of origin is El Salvador, e.g., “Made in El Salvador.” Effective April 5, 2025, Executive Orders implemented Reciprocal Tariffs.” All imported merchandise must be reported with either the Chapter 99 provision under which the reciprocal tariff applies or one of the Chapter 99 provisions covering exceptions to the reciprocal tariffs from all countries. At this time products will be subject to an additional 10 percent ad valorem rate of duty. At the time of entry, you must report the Chapter 99 heading applicable to your product classification, i.e. 9903.01.25, in addition to subheading 6302.60.0020, HTSUS, listed above. The tariffs and additional duties cited above are current as of this ruling’s issuance. 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 at https://hts.usitc.gov/. The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP. This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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, please contact National Import Specialist Kim Wachtel at kimberly.a.wachtel@cbp.dhs.gov. Sincerely, James Forkan Acting Director National Commodity Specialist Division