The tariff classification, eligibility for reduced duty status and country of origin marking of women’s knitwear from multiple countries; Treasury Decision (T.D.) 00-44

NY J86915 August 29, 2003 CLA-2-61:RR:NC:TA-359:J86915 CATEGORY: Classification TARIFF NO.: 6102.20.0010, 9802.00.50 Mr. Arthur W. Bodek and Mr. Joseph M. Spraragen Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt 245 Park Avenue, 33rd Floor New York, New York 10167-3397 RE: The tariff classification, eligibility for reduced duty status and country of origin marking of women’s knitwear from multiple countries; Treasury Decision (T.D.) 00-44 Dear Messrs. Bodek and Spraragen: In your letter dated July 24, 2003, on behalf of your client, Liz. Claiborne, Inc., North Bergen, New Jersey, you requested a ruling on the classification, eligibility for reduced duty status under 9802.00.50, Harmonized Tariff Schedule of the United States (HTS) and marking for country of origin purposes of a sample of women’s knitwear. Your sample is returned as requested. The sample consists of one style that you presented in two versions. Style WS-1 is a woman’s knitted jacket that consists of 80% cotton, 20% polyester fibers. The inside fabric of the garment is napped. The jacket has a full-front opening with a zippered closure, long sleeves with rib knit cuffs, a rib knit bottom, two kangaroo pockets at the waist and an attached self-fabric hood with a drawstring closure. In “Version A” of the sample we see a garment that is fully constructed and assembled but that is not dyed, washed or flock printed. In “Version B” we see the same sample after it was dyed, washed and flock printed. You submit that the production of this style will occur under two scenarios. In Scenario I the jacket is constructed and assembled in Macau in the condition in which we see it as “Version A”. At that point in the process the jacket is sent to Guatemala for dyeing, washing and flock printing. In Scenario II the jacket is produced in the United States in the condition in which it appears as “Version A”. At that point the jacket is sent to Guatemala for dyeing, washing and flock printing. Although you use the term “sweatshirt” to describe this garment and you suggest that it is classified in item 6110.20.2045, HTS, we note that it meets the various criteria for a jacket of heading 6102, HTS, that are found in the Explanatory Notes to the Tariff Schedule and also in the Customs publication, “Apparel Terminology Under the HTSUS”. Therefore, the applicable subheading for the woman’s knitted jacket, Style WS-1, will be 6102.20.0010, Harmonized Tariff Schedule of the United States (HTS), which provides for “Women’s --- overcoats ---windbreakers and similar articles, knitted or crocheted, other than those of heading 6104: of cotton: women’s.” The duty rate will be 16% ad valorem. You also request a determination as to whether or not the jacket is eligible for a partial duty exemption under subheading 9802.00.50, HTSUS. This subheading provides for a full or partial duty exemption for articles that are returned to the United States after having been exported to be advanced in value or improved in condition by means of repairs or alterations, provided that the appropriate documentary requirements of 19 CFR 10.8 are met. Section 10.8, Customs Regulations, states that: “Repairs or alterations” means restoration, addition, renovation, re-dyeing, cleaning, re-sterilizing, or other treatment which does not destroy the essential character of, or create a new and commercially different good from, the good that was exported from the United States.” This office believes that the dyeing, washing and flock printing operations that occur in Guatemala under both of your proposed scenarios, qualify as acceptable operations under subheading 9802.00.50, HTSUS. The jacket in its condition as exported and returned to the United States has the same use when sold to consumers. The operations in Guatemala do not result in the loss of the good’s identity. Neither do they create a new article with a new and different commercial use. Under the two scenarios that you presented, therefore, the operations that occur in Guatemala constitute an acceptable alteration within the meaning of heading 9802.00.50, HTSUS, and the jacket qualifies for the special tariff treatment of that provision. You also inquire about the country of origin for marking label purposes of the jacket according to both production processes. 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 United States shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) shall permit. This must be accomplished in such a manner as to indicate to the ultimate purchaser in the United States the name of the country of origin of the article. In Treasury Decision (T.D.) 00-44, published in the Federal Register, Vol.35, No. 133, at pages 42634-42637, July 11, 2000 (effective October 10, 2000), Customs stated that the provisions of the Customs Regulations (C.R.), Section 12.130, would no longer control the determination of the country of origin for marking label purposes of textile apparel and textile products. Instead, even in the case of textile apparel or textile products that are further processed abroad, the controlling statute is the Customs Regulations, Section 102.21. Under Scenario I the jacket is constructed and fully assembled in Macau. The marking label should reflect this fact. Under Scenario II the construction and assembly of the jacket occurs in the United States. As you note in your inquiry, the marking of apparel that is produced in this manner falls within the jurisdiction of the Federal Trade Commission. If you wish to pursue this issue we suggest that you contact that agency directly to ascertain whether your proposed labeling satisfies their requirements. The address is Federal Trade Commission, Division of Enforcement, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20508. The jacket falls within textile category designation 335. Based upon international textile trade agreements products which re-enter the United States after repairs or alterations are performed on them abroad are neither subject to quota restraints nor to the requirement of a visa. 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 Mike Crowley at 646-733-3049. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division