Tariff Classification and Special Tariff Treatment Applicable to a Carrying Bag Assembled in Mexico; NAFTA; Article 509; HQ 964626

HQ 964622 August 29, 2002 CLA-2 RR:CR:TE 964622 JFS CATEGORY: Classification TARIFF NO.: 4202.92.9026; 9802.00.80; 9802.00.90 Mr. John Stahl President Stahlsac, Inc. 81 Monticello Road P.O. Box 1673 Weaverville, N.C. 28787 RE: Tariff Classification and Special Tariff Treatment Applicable to a Carrying Bag Assembled in Mexico; NAFTA; Article 509; HQ 964626 Dear Mr. Stahl: This is in response to your request for a binding ruling, dated August 30, 2000, requesting a binding ruling on the classification of a soft sided carrying bag, described as a “Transporter Regulator Bag,” Stahlsac part number W 415-B, and imported from Mexico. You also inquire regarding the bag’s eligibility for preferential tariff treatment under the North American Free Trade Agreement (NAFTA). A sample of the carrying bag was submitted with your request. You state that the bag will be assembled in Mexico by your sister company, Stahlsac de Merida, S.A. de C.V. The bag consists of 5 different fabrics, 4 of which are of U.S. origin and one of which (nylon packcloth comprising most of the outer surface of the bag) is of Thai origin. You advise that all of the fabrics are cut to shape in the U.S. prior to being assembled in Mexico. The foam padding utilized in the bag is of Mexican origin. By telephone conversation, you confirmed that foam used to manufacture shoulder straps for your luggage originates in Taiwan and is cut to size in the U.S. There is no shoulder strap with the sample, however there are plastic loops for the attachment of a clip-on shoulder strap. In addition, the carrying bag consists of certain zipper and polypropylene webbing components of U.S. origin, hardware of U.S. and Chinese origin and a label of U.S. or Mexican origin. After the carrying bag is assembled in Mexico with the above-described components, it is imported into the U.S. for packaging. ISSUES: 1. What is the tariff classification of the imported assembled carrying bag? 2. Whether the imported carrying bag is entitled to special tariff treatment under NAFTA, subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUSA), or subheading 9802.00.90, HTSUSA. LAW AND ANALYSIS: Tariff Classification The “Transporter Regulator Bag,” part number W 415-B, is classified in subheading 4202.92.9026, HTSUSA, which provides for “other” bags with outer surface of textile materials of man-made fibers. The general column one rate of duty is 18.1% ad valorem. The quota/visa category number is 670. Applicability of: NAFTA; Subheading 9802.00.80; and Subheading 9802.00.90 The legal reasoning and analysis employed in Headquarters Ruling Letter (HQ) 964626, dated August 29, 2002, regarding the applicability of NAFTA, subheading 9802.00.80, HTSUSA, and subheading 9802.00.90, HTSUSA, and involving substantially similar travel bags as the instant carrying bag, is adopted and incorporated by reference. Accordingly, the applicability of NAFTA, subheading 9802.00.80, HTSUSA, and subheading 9802.00.90, HTSUSA, to the carrying bag described herein shall be made in accordance with the principles and legal analysis provided in HQ 964626, which is attached and made part of this ruling letter. HOLDING: The legal reasoning and analysis of HQ 964626, dated August 29, 2002, is adopted and incorporated by reference into this ruling. The “Transporter Regulator Bag,” part number W 415-B, is classified in subheading 4202.92.9026, HTSUSA, which provides for “other” bags with outer surface of textile materials of man-made fibers. The general column one rate of duty is 18.1% ad valorem. The quota/visa category number is 670. There are no quota or visa requirements for World Trade Organization (“WTO”) members. On the basis of the information and sample provided, the imported regulator bag, part number W 415-B, is not entitled to special tariff treatment under NAFTA or subheading 9802.00.90, HTSUSA, for the reasons set forth above. However, assuming that the operations performed abroad are acceptable assembly operations or operations incidental thereto, and the documentation requirements of 19 CFR 10.24 are met, the regulator bag may be entered under subheading 9802.00.80, HTSUSAA, with allowances in duty for the cost or value of the U.S.-origin fabric, zipper and polypropylene webbing components, as well as the U.S.-origin hardware and labels and the nylon packcloth components cut in the U.S. from Thai fabric. No allowance in duty may be made under this tariff provision for the cost or value of the foam components of Taiwanese and Mexican origin, the hardware of Chinese origin or the labels of Mexican origin. 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, Myles B. Harmon, Acting Director Commercial Rulings Division Enclosure