Eligibility of textile gloves assembled in South Africa for preferential

HQ 561866 December 7, 2001 CLA-02 RR:CR:SM 561866 CW CATEGORY: Classification TARIFF NO.: 9819.11.09 Mr. Leo Leung Austins Marmon Ltd. 29th Floor, Nanyang Plaza 57 Hung To Road Kwun Tong, Kowloon, Hong Kong RE: Eligibility of textile gloves assembled in South Africa for preferential treatment under AGOA Dear Mr. Leung: This is in response to your letter of June 14, 2000, requesting a ruling on the eligibility of textile gloves produced in South Africa for preferential treatment under the Africa Growth and Opportunity Act (AGOA). We regret the delay in responding. FACTS: You ask that we confirm that there is no import quota or duties applicable to textile gloves imported into the U.S. from South Africa if the "raw materials for the production of such gloves were 100% produced in South Africa with labor in South Africa." For purposes of this ruling, we are assuming that the above-quoted description of the processing of the gloves means that the gloves are wholly assembled in South Africa from fabric wholly formed in South Africa from yarn originating in South Africa. ISSUE: Whether textile gloves produced in South Africa as described above are eligible for preferential tariff and quota treatment under AGOA when imported into the U.S. LAW AND ANALYSIS: The Trade and Development Act of 2000 was signed into law on May 18, 2000 (Pub. L. 106-200, 114 Stat. 251). Title I of the Act concerns trade benefits for sub-Saharan Africa and is referred to as the African Growth and Opportunity Act (AGOA). Section 112 of the AGOA (codified at 19 U.S.C. 3721) specifies the textile and apparel articles that are eligible for duty-free and quota-free treatment when imported directly into the customs territory of the U.S. from a beneficiary sub-Saharan African country. Presidential Proclamation 7350 dated October 2, 2000, published in the Federal Register on October 4, 2000 (65 FR 59321), implemented the AGOA by designating the eligible beneficiary sub-Saharan African countries and amending Chapter 98, Harmonized Tariff of the U.S. (HTSUS) (including the creation of new subchapter XIX) to facilitate the entry of the specific textile and apparel articles eligible for preferential treatment under the AGOA. The textile and apparel trade benefits provided by the AGOA are available to eligible articles imported from countries that the President designates as beneficiary sub-Saharan African countries, provided that the U.S. Trade Representative ("USTR") has determined that these countries (1) have adopted an effective visa system and related procedures to prevent unlawful transshipment and use of counterfeit documents, and (2) have implemented and follow, or are making substantial progress toward implementing and following certain customs procedures that allow U.S. Customs to verify the origin of the articles. South Africa is among the countries designated by the President as beneficiary sub-Saharan African countries in Presidential Proclamation 7350. In addition, by notice published in the Federal Register on March 12, 2001 (66 FR 14425), the USTR determined that South Africa meets the two criteria set forth above. Interim Customs Regulations to implement the trade benefit provisions of the AGOA were published in the Federal Register as T.D. 00-67 on October 5, 2000 (65 FR 59668). Public comments were invited on the Interim Regulations for submission by December 4, 2000. Section 112(b)(1) of the AGOA provides, in pertinent part, that preferential treatment applies to - Apparel articles assembled in one or more beneficiary sub-Saharan African countries from fabrics wholly formed and cut in the United States, from yarns wholly formed in the United States...that are- (A) entered under subheading 9802.00.80 of the Harmonized Tariff Schedule of the United States; or (B) entered under chapter 61 or 62 of the Harmonized Tariff Schedule of the United States, if, after such assembly, the articles would have qualified for entry under subheading 9802.00.80...but for the fact that the articles were embroidered or subjected to stone-washing, enzyme-washing, acid washing, perma-pressing, oven-baking, bleaching, garment-dyeing, screen printing, or other similar processes. Section 112(b)(2) of the AGOA provides, in pertinent part, that preferential treatment applies to - Apparel articles cut in one or more beneficiary sub-Saharan African countries from fabric wholly formed in the United States from yarns wholly formed in the United States...if such articles are assembled in one or more beneficiary sub-Saharan African countries with thread formed in the United States. Neither section 112(b)(1) or (2) would encompass the scenario you have presented as these provisions require the fabric to be wholly formed in the U.S. from yarn that is wholly formed in the United States. However, section 112(b)(3) of the AGOA provides, in pertinent part, that preferential treatment applies to - Apparel articles wholly assembled in one or more beneficiary sub-Saharan African countries from fabric wholly formed in one or more beneficiary sub-Saharan African countries from yarn originating either in the United States or one or more beneficiary sub-Saharan African countries.... Articles meeting the requirements of section 112(b)(3) of the AGOA are eligible for duty-free and quota-free entry under subheading 9819.11.09, HTSUS, subject to the quantitative limitations set forth in U.S. Note 2, subchapter XIX, Chapter 98, HTSUS. HOLDING: Based on the information submitted, textile gloves wholly assembled in South Africa from fabric wholly formed in South Africa from yarn originating in South Africa are eligible for preferential treatment under section 112(b)(3) of the AGOA and subheading 9819.11.09, HTSUS, subject to the quantitative limitations set forth in U.S. Note 2, subchapter XIX, Chapter 98, HTSUS. This conclusion assumes compliance with the applicable Interim Regulations implementing the AGOA. A copy of the Interim Regulations is enclosed. 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 Commercial Rulings Division Enclosure 2