Eligibility of imported pants for duty-free treatment under subheading 9802.00.90; Special Regime; oven-baking, curing process; perma-pressing

HQ 560132 February 26, 1997 CLA-2 RR:TC:SM 560132 KKV CATEGORY: Classification TARIFF NO.: 9802.00.90 Ms. Terry Polino Sandler, Travis and Rosenberg 1341 Street, N.W. Washington, D.C. 20005-3105 RE: Eligibility of imported pants for duty-free treatment under subheading 9802.00.90; Special Regime; oven-baking, curing process; perma-pressing Dear Ms. Polino: This is in response to your letter dated October 14, 1996, on behalf of Red Kap Industries ("Red Kap"), which requests a binding ruling regarding the applicability of subheading 9802.00.90, Harmonized Tariff Schedule of the United States (HTSUS), to pants subjected to a certain post-curing process in Mexico. No sample of the garment was submitted for our examination. FACTS: We are informed that Red Kap Industries proposes to import pants assembled in Mexico from fabric components which have been cut in the United States. No information regarding either the origin of the fabric or the origin of any trimmings or findings (i.e., thread, buttons, etc.) has been provided. It is stated that, at the time of purchase, the fabric has previously been treated in the U.S. with a resin catalyst system to allow for "pressing" and "curing" (i.e., "oven-baking") after the garment is assembled to facilitate crease retention and seam and surface flatness. We are informed that these operations, described as a perma-pressing process, consist of two primary steps: pressing and oven-baking, both of which take will place in Mexico. After the pants are assembled, the garment will be pressed and placed upon a hanger. The hanger will then be loaded onto an oven conveyor which will transport the pants into the oven for curing. The temperature of the oven and the time period for which the pants are cured are variables dictated by the type of resin-treatment used on the fabric. Upon exiting the oven, the pants will be removed from the hanger, inspected for defects and packed for shipment prior to exportation to the U.S. ISSUE: Whether the "oven-baking" curing process described above is a permissible post-assembly operation for purposes of subheading 9802.00.90, HTSUS. LAW AND ANALYSIS: Annex 300-B of the North American Free Trade Agreement ("NAFTA") is applicable to textile and apparel goods. Appendix 2.4 of Annex 300-B provides that: On January 1, 1994, the U.S. shall eliminate customs duties on textiles and apparel goods that are assembled in Mexico from fabrics wholly formed and cut in the United States and exported from and reimported into the United States under: a) U.S. tariff item 9802.00.80.10; or (b) Chapter 61, 62, or 63 if, after such assembly, those goods that would have qualified for treatment under 9802.00.80.10 have been subject to bleaching, garment dyeing, stone-washing, acid-washing or perma-pressing. Thereafter, the U.S. shall not adopt or maintain any customs duty on textile or apparel goods of Mexico that satisfy the requirements of subparagraph (a) or (b) or the requirements of any successor provision to U.S. tariff item 9802.00.80.10. Consequently, subheading 9802.00.90, HTSUS, was created to provide for the duty-free entry of: Textile and apparel goods, assembled in Mexico in which all fabric components were wholly formed and cut in the United States, provided that such fabric components, in whole or in part, (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process; provided the goods classifiable in chapters 61, 62, or 63 may have been subject to bleaching, garment dyeing, stone-washing, acid-washing or perma-pressing after assembly as provided for herein. With regard to the permissibility of post-assembly processes performed upon textile and apparel goods classifiable under chapters 61, 62 or 63, HTSUS, which are specifically set forth, Customs has taken the position that the processes expressly referred to in subheading 9802.00.90, HTSUS, were not intended to constitute an all-inclusive list. Other operations, while not specifically set forth in the text of the tariff provision, are so substantially similar in effect to those processes listed, that they will not disqualify otherwise eligible articles from receiving the duty-free treatment provided for under subheading 9802.00.90, HTSUS. In Headquarters Ruling Letter (HRL) 559584 dated April 2, 1996, Customs considered whether enzyme washing should be considered a process allowable under subheading 9802.00.90, HTSUS, even though "enzyme washing" is not specifically set forth in this tariff provision. Customs found that although "enzyme washing" is not specified in subheading 9802.00.90, HTSUS, there was no reasonable justification for not allowing duty-free treatment to garments which were imparted with essentially the same characteristics as garments subjected to one of the processes specified in the tariff provision. Accordingly, it was held that garments subjected to the enzyme washing described in that ruling were eligible for duty-free treatment under subheading 9802.00.90, HTSUS. In HRL 560009, dated October 11, 1996, Customs considered whether a heat curing process was permissible under subheading 9802.00.90, HTSUS. Under the facts presented, garments made from fabric treated with formaldehyde-based resin were steam pressed and then oven heated to 350 degrees, resulting in enhanced performance in the fabric's ability to resist or shed wrinkles. Customs held that the process of heat curing was similar to a perma-pressing operation in that both operations imparted similar characteristics to the fabric and determined that heat curing was a permissible operation within the meaning of subheading 9802.00.90, HTSUS. Similar to the pressing and heat curing process described in HRL 560009, the pressing and "oven-baking" process at issue are performed upon resin-treated fabric to obtain enhanced performance capabilities in crease retention and seam and surface flatness and thus, imparts characteristics similar to those of perma-pressing, an operation specifically set forth as allowable for purposes of subheading 9802.00.90, HTSUS. Accordingly, the pressing and "oven-baking" described above are permissible post- assembly operations for goods classifiable in Chapters 61, 62 or 63, HTSUS, for purposes of subheading 9802.00.90, HTSUS. HOLDING: Based upon the information provided, where imported articles are classifiable under Chapters 61, 62 or 63, HTSUS, the pressing and "oven-baking" operation described above are permissible post-assembly operations within the meaning of subheading 9802.00.90, HTSUS. A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction. Sincerely, John Durant, Director Tariff Classification and Appeals Division