HQ 0954980 - HRL 952536 and HRL 954023 revoked. Country of origin of T- shirts. Cutting and assembly. - United States International Trade Commision Rulings

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HQ 954980

September 16, 1993

CLA-2 CO:R:C:T 954980 HP

CATEGORY: CLASSIFICATION

Mr. William W. Jackson
Partner
Woo Brown Jackson
P.O. Box 779 Boroko
PAPUA NEW GUINEA

RE: HRL 952536 and HRL 954023 revoked. Country of origin of T- shirts. Cutting and assembly.

Dear Mr. Jackson:

This is in reply to your letter of August 20, 1993. That letter concerned the country of origin of shirts, exported from Papua New Guinea (PNG).

FACTS:

The merchandise at issue consists of either knitted or woven t-shirts, either 100 percent cotton or a 65 percent polyester / 35 percent cotton blend. In HRL 952536 of February 1, 1993, (affirmed in HRL 954023 of May 18, 1993) we described this merchandise as follows:

Presently, the knitted fabrics come into
Papua New Guinea (PNG) from either Australia, Japan, Hong Kong or Singapore in rolled bundles with an average weight of 45 pounds. The woven material comes from the same countries, "rolled normally with 44/45 x 120 yards." At this time, the garments are cut, sewn, trimmed and finished in PNG.

You now question as to the country of origin of "pre-cuts to be finished off in PNG" for export to the United States. It is our understanding that the fabric will be either knitted or woven and cut to patterned sizes and shapes in either Australia, Japan, Hong Kong or Singapore, and the patterned pieces assembled into t-shirts, packaged and shipped in PNG.

Based upon the above description, we ruled that "the assembly operations performed in PNG do not substantially transform the t- shirts into products of PNG. Those operations constitute a simple sewing of the cut patterned pieces into a t-shirt." In your current letter, you advise us that we misinterpreted your original statement of the facts, in that the cutting of garment parts from material lengths takes place not in Country "A", but in PNG. "[O]nly the materials used (material, buttons and thread) originate from outside of [PNG]."

ISSUE:

Whether the cutting and assembly in PNG results in a substantial transformation for purposes of 12.130, Customs Regulations?

LAW AND ANALYSIS:

Textile commodities produced in more than one foreign country are subject to the country of origin requirements delineated in section 12.130 of the Customs Regulations (19 C.F.R. 12.130). These regulations provide that:

. . . a textile product . . . which consists of materials produced or derived from, or processed in, more than one foreign . . . country shall be a product of that foreign . . . country where it last underwent a substantial transformation.

12.130(b). A textile product undergoes a substantial transformation when it is ". . . transformed by means of substantial manufacturing or processing operations into a new and different article of commerce."

Section 12.130 of the regulations outlines the criteria used to determine the country of origin for textiles and textile products. Specifically, this provision of the regulations is considered in determining whether a textile product has undergone substantial manufacturing or processing operations, and what constitutes a new and different article of commerce. The factors considered are not exhaustive. In fact, "one or any combination of criteria may be determinative, and additional factors may be considered." In determining whether merchandise has undergone substantial manufacturing or processing operations, we consider the (1) physical change in the material or the article; (2) time involved; (3) complexity of the operations; (4) level or degree of skill and/or technology required; and (5) value added to the article in each country.

The cutting of fabric into parts and the assembly of those parts into the completed article is normally sufficient to consider that article a product of country "B". 12.130(e)(iv), Customs Regulations. Assuming for the purposes of this ruling that no cutting lines or other lines of demarcation exist on the fabric, the country of origin of the woven or knitted T-shirts is Papua New Guinea. Due to the above-mentioned mistake of fact, HRL 952536 and HRL 954023 are revoked.

HOLDING:

As a result of the foregoing, the instant merchandise is considered a product of Papua New Guinea.

In order to insure uniformity in Customs classification of this merchandise and eliminate uncertainty, we are revoking HRL 952536 of February 1, 1993, and HRL 954023 of May 18, 1993, pursuant to 19 C.F.R. 177.9(d)(1), to reflect the above classification effective with the date of this letter. For the purposes of future transactions in merchandise of this type, including that for which the present classification is requested, HRL 952536 and HRL 954023 will not be valid precedent.

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is imported. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.

Sincerely,

John Durant, Director
Commercial Rulings Division

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