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HQ 088321

March 7, 1991

CLA-2 CO:R:C:T 088321 HP


Mr. Richard J. Wallace
International Marketing
Wiseknit Group of Companies
639 Homewood Avenue
Highland Park, IL 60035

RE: Country of origin of diapers. Mere cutting of fabric into squares is not a substantial transformation.

Dear Mr. Wallace:

This is in reply to your letter of November 12, 1990, concerning the country of origin determination of diapers produced in either China or Jamaica, for quota/visa purposes.


The merchandise at issue consists of 100% cotton cloth diapers, your style JD #12. You describe the manufacturing processes as follows:

1. People's Republic of China
a. Fabric construction 21s x 21s 76 x 38 thread count per square inch, woven cloth, 1 ounces per diaper (12 diapers to a package = 18 oz) b. Cost i. Fabric: $0.206/yard ii. 9 yards used per dozen diapers = $1.85 total P.R.C.

2. Jamaica
a. Usage for infant boys and girls b. Size: 27" x 27" flat diaper i. Lines of demarcation inserted in
Jamaica c. Eight stitches per inch d. Cost i. Thread: $0.12 per dozen ii. Printed polybag in 6 colors: $0.06 iii. Inner packing boxes: $0.10 per dozen iv. Export carton: $0.15 per dozen v. Packing bans: $0.03 per dozen vi. Labor: $0.92
(1) receiving fabric
(2) inspecting fabric
(3) cutting fabric
(4) sewing fabric
(5) pressing
(6) stamping "Made in Jamaica"

(7) folding
(8) packing 12 per polybag vii. Administrative factory overhead, interest & inland freight: $0.26 per dozen viii. Marketing and communication: $0.38 ix. Ocean freight to US: $0.10


Whether the cutting and sewing of Chinese fabric in Jamaica constitutes a substantial manufacturing operation such that the merchandise is deemed to have been substantially transformed pursuant to 19 C.F.R. 12.130?


Pursuant to section 12.130, Customs Regulations (19 CFR 12.130), a textile or textile product which consists of materials produced or derived from, or processed in, more than one foreign territory or country shall be a product of that foreign territory or country 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.

Section 12.130(d) establishes criteria for determining whether an article has been substantially transformed. However, the criteria set forth in 19 CFR 12.130(d) are not exhaustive; one or any combination of these criteria may be determinative and additional factors may be considered.

According to 19 CFR 12.130(d)(2), the following factors are to be considered in determining whether merchandise has been subjected to substantial manufacturing or processing operations: the physical change in the material or article, the time involved in the manufacturing or processing operations, the complexity of the operations, the level or degree of skill and/or technology required, and the value added to the article.

Nevertheless, section 12.130(e)(2) provides that an article will usually not be considered to be a product of a particular country merely by having undergone:

(ii) Cutting to length or width and hemming or overlocking fabrics which are readily identifiable as being intended for a particular commercial use....

In this case, the fabric is merely cut into squares and the edges hemmed. Consequently, it is our opinion that the operations to which the fabric is subjected are insufficient to constitute a substantial manufacturing process under 19 C.F.R. 12.130. See HRL 087950 of January 9, 1991.


As a result of the foregoing, the cutting and sewing operations performed in Jamaica do not constitute a
substantial transformation as required by 19 C.F.R. 12.130. The country of origin of the instant merchandise is the People's Republic of China.

The holding in this ruling applies only to the specific factual situation and merchandise identified in the ruling request. This position is clearly set forth in section 177.9(b)(1), CUSTOMS REGULATIONS (19 C.F.R. 177.9(b)(1)). This section states that a ruling letter is issued on the assumption that all of the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. Should it subsequently be determined that the information furnished is not complete and does not comply with 19 C.F.R. 177.9(b)(1), the ruling will be subject to modification or revocation. In the event there is a change in the facts previously furnished this may affect the determination of country of origin. In such a case, it is recommended that a new ruling request be submitted in accordance with section 177.2, CUSTOMS REGULATIONS (19 C.F.R. 177.2).


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