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HQ 955477

February 16, 1994

CLA-2 CO:R:C:T 955477 CAB


TARIFF N0.: 4202.22.8050

Lorraine M. Dugan
Associated Merchandising Corporation
1440 Broadway
New York, NY 10018

RE: Country of origin of tapestry handbags; Classifiable in Heading 4202; GRI 3(b)

Dear Ms. Dugan:

This is in response to your inquiry of October 19, 1993, requesting a country of origin and tariff classification determination for certain handbags. Several samples were submitted for examination.


There are three styles of handbags at issue. The styles are referred to as CH-10(5029), CH-11(5099), and CH-12(5100B). All of the handbags are constructed of 80 percent polyester/20 percent acrylic tapestry fabric and imitation leather. Each bag features imitation leather shoulder straps, zippers, grommets, piping, webbing, labels, and assorted sections and pockets. Style 5099 has double imitation leather handles in addition to the shoulder strap, which is removable.

The tapestry fabric as well as all the other components of the finished handbags are manufactured in Korea. The fabric is also cut into panels in Korea and all processing of the components, except final sewing and assembly is completed in Korea. The components are then transported to China for further processing.

The processing in China includes gluing, sewing, and assembling the sub-assembled pieces such as the flap, shoulder straps, covered piping, handles, "D" ring holders, tabs, change pocket, collars, affixing the rivets and snaps, as well as the final assembly of the finished product.

A cost breakdown was submitted for the processing of the subject merchandise. The cost incurred for the processing in Korea ranges from 87 percent to 88.4 percent while the cost incurred for the processing in China ranges from 11.6 percent to 13 percent.


I. What is the tariff classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) for the subject merchandise?

II. What is the country of origin for the subject merchandise?



Classification of goods under the HTSUSA is governed by the General Rules of Interpretation (GRI's). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes. Merchandise that cannot be classified in accordance with GRI 1 is to be classified in accordance with subsequent GRI's taken in order.

Heading 4202, HTSUSA, is the provision for trunks, suitcases, vanity cases, attache cases, briefcases, school satchels, spectacle cases, binocular cases, camera cases, musical instrument cases, gun cases, holsters and similar containers; traveling bags, toiletry bags, knapsacks and backpacks, handbags, shopping bags, wallets, purses, map cases, cigarette cases, tobacco pouches, tool bags, sports bags, bottle cases, jewelry boxes, powder cases, cutlery cases and similar containers, of leather or of composition leather, of sheeting of plastics, of textile materials, of vulcanized fiber or of paperboard, or wholly or mainly covered with such materials or with paper.

GRI 3(a) requires that where two or more headings describe the merchandise, the more specific will prevail; or if two or more headings each refer to part only of the materials in the goods, then classification will be by GRI 3(b). GRI 3(b) states that the material or component which imparts the essential character to the goods will determine the classification.

The handbags at issue are constructed of two components, textile fabric and vinyl plastic in the form of imitation leather. Handbags with an outer surface of plastic sheeting are provided for under subheading 4202.22.15, HTSUSA, whereas those with an outer surface of textile material are covered in subheading 4202.22.80, HTSUSA. The textile portion of the handbags at issue is instantly recognizable as imparting the essential character of the merchandise. The tapestry fabric makes up the majority of the handbag, whereas the imitation leather is utilized only as trimming on the straps and edging. The tapestry fabric is the most readily identifiable feature of the handbag and it costs more than the imitation leather components. As a result, the handbags at issue are classifiable under subheading 4202.22.80, HTSUSA, which provides for handbags with outer surface of textile materials.


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 operation

(iii) The complexity of the manufacturing or processing operation

(iv) The level or degree of skill and/or technology required

(v) The value added to the article or material

Although the handbags are sewn and assembled in China, the tapestry fabric and the majority of all the other components are manufactured in Korea. In addition, the cutting of the fabric into panels occurs in Korea. The sewing and final assembly process in China is relatively simple, consisting of a joining together of components, some of which have already been subassembled in Korea. Therefore, the processing in China does not constitute a substantial manufacturing operation in accordance with Section 12.130, Customs Regulations. Moreover, pursuant to Section 12.130(d)(2)(v), the value added to merchandise in a particular country is a factor in determining country of origin. In this instance, more than three-quarters of the total value of the merchandise arises from the manufacturing operations and materials originating in Korea. Consequently, the country of origin of the subject merchandise is Korea since this is the country where the last substantial transformation occurred.

This analysis and conclusion is in accordance with similar Headquarters Ruling Letters (HRLs) that determined the country of origin of bags similar to the subject handbags. For example, in HRL 951899, dated October 31, 1992, Customs concluded that the country of origin of tote bags and luggage featuring zippers, grommets, piping, webbing and textile fabric manufactured and cut into panels in Taiwan and then sent to China for sewing and assembly were subject to their last substantial transformation in Taiwan. See also, HRL 954225, dated August 30, 1993.


Based on the foregoing, styles CH-10(5029), CH-11(5099), and CH-12(5100B) are classified in subheading 4202.22.8050, HTSUSA, which provides for handbags with an outer surface of textile material, of man-made fibers. The applicable rate of duty is 20 percent ad valorem and the textile restraint category is 670. The country of origin of the subject handbags is Korea.

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).

The designated textile and apparel category may be subdivided into parts. If so, visa and quota requirements applicable to the subject merchandise may be affected. Since part categories are the result of international bilateral agreements which are subject to frequent renegotiations and changes, to obtain the most current information available, we suggest that you check, close to the time of shipment, the Status Report on Current Import Quotas (Restraint Levels), an internal issuance of the U.S. Customs Service, which is available for inspection at your local Customs office.

Due to the changeable nature of the statistical annotation (the ninth and tenth digits of the classification) and the restraint (quota/visa) categories applicable to textile merchandise, you should contact your local Customs office prior to importing the merchandise to determine the current status of any import restraints or requirements.


John Durant, Director
Commercial Rulings Division

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