United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1993 HQ Rulings > HQ 0952552 - HQ 0952621 > HQ 0952579

Previous Ruling Next Ruling

HQ 952579

November 25, 1992

CLA-2 CO:R:C:T 952579 CAB


Mr. Harry Gross
Britannica Home Fashions
214 West 39th Street
New York, NY 10018

RE: Country of origin of flat sheets

Dear Mr. Gross:

This letter is in response to your inquiry of August 14, 1992, requesting a country of origin determination of flat sheets. Samples were submitted for examination.


You refer to the countries where processing will occur as Country "A", Country "B", and Country "X". The flat sheets will be constructed of 100 percent woven cotton fabric. They will be manufactured as follows:

Country "A" - The cotton fabric is manufactured and sent to Country "B".

Country "B" - The fabric is bleached and printed and sent to Country "X".

Country "X" - The fabric is brushed, pre-shrunk, cut, hemmed, labeled, folded, packed, and exported to the United States.

The following cost percentages for the direct processing done in each country were submitted.

Country "A" - 42%
Country "B" - 16%
Country "X" - 42%


What is the country of origin of the merchandise in question?


Country of origin determinations for textile products are subject to Section 12.130, Customs Regulations (19 CFR 12.130). Section 12.130 provides that a textile product that is processed in more than one country or territory shall be a product of that country or territory where it last underwent a substantial transformation. A 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), Customs Regulations, sets forth criteria for determining whether a substantial transformation of a textile product has taken place. This regulation states these criteria are not exhaustive; one or any combination of criteria may be determinative, and additional factors may be considered.

Section 12.130(d)(1), Customs Regulations, states that a new and different article of commerce will usually result from a manufacturing or processing operation if there is a change in:

(i) Commercial designation or identity,
(ii) Fundamental character or (iii) Commercial use.

Section 12.130(d)(2), Customs Regulations, states that for determining whether merchandise has been subjected to substantial manufacturing or processing operations, the following will be considered.

(i) The physical change in the material or article

(ii) The time involved in the manufacturing or processing

(iii) The complexity of the manufacturing or processing

(iv) The level or degree of skill

(v) The value added to the article of material

Section 12.130(e), Customs Regulations, further provides, in pertinent part:

(1) An article or material usually will be a product of a particular foreign territory or country,...when it has undergone prior to the importation into the U.S. in that foreign territory or country...any of the following:

(i) Dyeing of fabric and printing when accompanied by two or more of the following finishing operations: bleaching, shrinking, fulling, napping, decating, permanent stiffening, weighting, permanent embossing, or moireing.

When applying the above criteria to the merchandise in question, it appears that the merchandise will not be substantially transformed in Country "X" or Country "B". Customs has consistently ruled that in order to comply with Section 12.130(e)(1)(i), a fabric must be both dyed and printed, as well as being subjected to the other required processing. See Headquarters Ruling Letter (HRL) 089230 of May 10, 1991. In this case, the instant fabric is not subject to both dyeing and printing in Country "B" or Country "X".

This interpretation of Section 12.130 was upheld by the United States Court of International Trade in Mast Industries Inc. v. United States, 652 F. Supp. 1531 (1987); aff'd 822. F.2d 1069 (CAFC, 1989). That case involved greige cotton fabric produced in China and sent to Hong Kong for singeing, desizing, scouring, bleaching, mercerizing, dyeing, softening, and tentering. The court stated that in determining the meaning of a agency's regulation, it would defer to that agency's interpretation unless the interpretation is plainly erroneous or inconsistent with the regulation. The court found that Custom's interpretation was reasonable and approved of Customs denying entry to the finished fabric without a visa from the Government of China.

The cutting and sewing processing performed in Country "X" is not considered to be substantial processing within the purview of Section 12.130(d)(2). It does not require much time and the processing operations are not complex nor do they require a high degree of skill or technology. The value derived from the processing in Country "B" is not significant in this case.

The manufacturing process in Country "A" creates the fabric. Since the cutting and sewing process in Country "X" does not result in a substantial transformation, the forming of the fabric in Country "A" is considered the time at which the last substantial transformation occurred. Consequently, the country of origin of the merchandise in question is Country "A".


The country of origin of the merchandise in question is Country "A".

The holding set forth above 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 CFR 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 CFR 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. Accordingly, it is recommended that a new ruling request be submitted in accordance with section 177.2, Customs Regulations (19 CFR 177.2).


John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling