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HQ 086834

November 15, 1990

CLA-2 CO:R:C:G 086834 DRR


Mr. William J. Le Clair
Trans-Border Customs Services, Inc.
One Trans-Border Drive
P.O. Box 800
Champlain, New York 12919

RE: Country of origin of sports towels

Dear Mr. Le Clair:

This is in reference your letter, dated March 12, 1990, requesting, on behalf of Leader Manufacturing, Inc., a determination as to the country of origin of certain sports towels.


The merchandise at issue are sports towels made of highly absorbent cellulose material. The fabric will be imported from West Germany to Canada in rolls approximately 24 inches wide by 500 feet in length. The material will be cut to towel size of 12 inches by 14 inches. The company logo will be printed on each towel, which will then be rolled and placed in plastic tubing for marketing. The packaging is made in Canada.


What is the country of origin of the sports towels.


Section 12.130, Customs Regulations (19 CFR 12.130), provides, in pertinent part, that a textile or textile product which consists of materials produced or derived from, or processed in, more than one foreign territory or country, or insular possession of the United States, shall be a product of
that foreign territory or country, or insular possession where it last underwent a substantial transformation. A textile or textile product will be considered to have undergone a substantial transformation if it has been transformed by means of substantial manufacturing or processing operations into a new and different article of commerce. A new and different article of commerce will usually result from a manufacturing or processing operation if there is a change in commercial designation or identity, fundamental character or commercial use. The criteria used to determine whether a substantial transformation has taken place include the physical change in the article, the time, complexity and value added by the operation.

Treasury Decision (T.D.) 85-38, published March 5, 1985, states, at page 67, that where fabric which is readily identifiable as being intended for a particular commercial use (e.g. towelling or bed linen material) is merely cut to length or width, with edges then either hemmed or overlocked, the country which produced the fabric is the country of origin, not the country where the fabric was cut. The Decision also states, at page 66, that finishing operations short of a combination of both dyeing and printing together with a least two other major finishing operations will not result in a substantial transformation of the fabric. The cutting, printing and packaging operations performed in Canada are insufficient to constitute a substantial transformation. Therefore, the sports towels in question are considered to be a product of West Germany.


The country of origin of the merchandise at issue is West Germany.


John Durant, Director

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