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HQ 557918

May 23, 1994

CLA-2 CO:R:C:S 557918 MLR


TARIFF NO.: 9802.00.80

Mr. Chris Garcia
Kuehne & Nagel, Inc.
Orlando Branch
8500 Parkline Blvd.
Suite 114
Orlando, Florida 32809

RE: Applicability of partial duty exemption under HTSUS subheading 9802.00.80 to "cool-dana" and pouch; sewing; cutting-to-length

Dear Mr. Garcia:

This is in response to your letter of February 21, 1994, and undated follow-up letter to the New York Seaport, requesting a ruling on behalf of Personal Comfort Corporation, regarding the applicability of subheading 9802.00.80, Harmonized Tariff Schedule of the United States (HTSUS), to a "cool-dana" and pouch from Honduras. Samples were submitted with your request.


The "cool-dana" is intended to be worn around the neck in warmer climates and provides coolness to the wearer through the use of a "blue ice" tube which is inserted into the cool-dana. In Honduras, the cool-dana is made by sewing two pieces of 100 percent cotton fabric together. The pieces are precut in the U.S. and measure 32 by 5 inches and 5 by 3 inches. The smaller piece is sewn on three sides to the larger piece and one side is left open so that the tube of blue ice tube may be inserted. Next, a small piece of velcro is cut-to-length in Honduras, and sewn to the open end of the small piece to permit closure. You state that the fabrics and velcro are wholly produced in the U.S.

The second article is a pouch constructed of 100 percent textured polyester knit fabric laminated to a foam and plastic sheet back. The laminated fabric is precut in the U.S. into pieces measuring 9 by 20 inches. In Honduras, a piece of laminated fabric is folded and sewn at the sides leaving one side open to form a 8.5 by 8.5 inch pouch. A 3/4 inch strip of velcro strip is cut-to-length from a roll, and sewn along the inside edge of the open side so that the pouch may be closed. A textile cord loop handle is cut-to-length and sewn onto one corner of the pouch. Lastly, a loop of velcro strip is sewn to the center of both sides of the open end of the pouch. You state that all of the above components are wholly produced in the U.S.


Whether the "cool-dana" and pouch will qualify for the partial duty exemption available under subheading 9802.00.80, HTSUS, when returned to the U.S.


Subheading 9802.00.80, HTSUS, provides a partial duty exemption for:

[a]rticles assembled abroad in whole or in part of fabricated components, the product of the United States, which (a) were exported in condition ready for assembly without further fabrication, (b) have not lost their physical identity in such articles by change in form, shape, or otherwise, and (c) have not been advanced in value or improved in condition abroad except by being assembled and except by operations incidental to the assembly process, such as cleaning, lubricating and painting.

All three requirements of subheading 9802.00.80, HTSUS, must be satisfied before a component may receive a duty allowance. An article entered under this tariff provision is subject to duty upon the full cost or value of the imported assembled article, less the cost or value of the U.S. components assembled therein, upon compliance with the documentary requirements of section 10.24, Customs Regulations (19 CFR 10.24).

Section 10.14(a), Customs Regulations (19 CFR 10.14(a)), states in part that:

[t]he components must be in condition ready for assembly without further fabrication at the time of their exportation from the United States to qualify for the exemption. Components will not lose their entitlement to the exemption by being subjected to operations incidental to the assembly either before, during, or after their assembly with other components.

Section 10.16(a), Customs Regulations (19 CFR 10.16(a)), provides that the assembly operation performed abroad may consist of any method used to join or fit together solid components, such as welding, soldering, riveting, force fitting, gluing, lamination, sewing, or the use of fasteners.

Operations incidental to the assembly process are not considered further fabrication operations, as they are of a minor nature and cannot always be provided for in advance of the assembly operations. See 19 CFR 10.16(a). However, any significant process, operation or treatment whose primary purpose is the fabrication, completion, physical or chemical improvement of a component precludes the application of the exemption under subheading 9802.00.80, HTSUS, to that component. See 19 CFR 10.16(c).

In the instant case, sewing the fabric together or the laminated fabric to itself, and sewing the velcro strips and textile cord loop handle to the "cool-dana" and pouch are considered acceptable assembly operations pursuant to 19 CFR 10.16(a), because two solid components are being joined (i.e., sewn) together. Furthermore, cutting the velcro strips and textile cord to length in Honduras is explicitly enumerated as an acceptable operation incidental to the assembly process under 19 CFR 10.16(b)(6). Consequently, the U.S.-origin fabric, velcro, and textile cord will be eligible for the duty allowance available under subheading 9802.00.80, HTSUS, when returned to the U.S.


On the basis of the information and samples submitted, it is our opinion that the operations performed abroad to create the "cool-dana" and pouch are considered proper assembly operations or operations incidental thereto. Therefore, the "cool-dana" and pouch may enter the U.S. under subheading 9802.00.80, HTSUS, with allowances in duty for the cost or value of the U.S. components therein, provided the documentary requirements of 19 CFR 10.24 are satisfied.


John Durant, Director

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