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NY 805625

January 18, 1995

CLA-2-57:S:N:N6:349 805625


TARIFF NO.: 5703.20.2010, 5703.20.2090

Mr. Robert J. Flick
California Carpet
2227 Commerce Place
Hayward, CA 94545

RE: The tariff classification of a tufted rug from China.

Dear Mr. Sun:

In your letter dated December 29, 1994, you requested a classification ruling.

Photographs and swatches of rugs were submitted to this office. The face of the rugs are made of nylon yarns. The yarns are inserted into a pre-existing polypropylene base and are held in place with an adhesive and a secondary fabric backing. The rugs will measure approximately 4 x 6 feet, 6 x 9 feet and 9 x 12 feet. The edges will be finished with a polyester seaming/binding tape. The corner swatch of the rug shows that the finished item will have a large rectangular central area trimmed with a 2 inch wide contrasting color border. Carpet, seaming tape, mesh and other materials are sent from the United States to China. In China the carpets are cut to length and width, 45 degree angles are cut on the ends of the border strips and the sections are joined using Chinese glue to form rugs of various color combinations. The rugs are carved along the seam between the border and the center sections.

The applicable subheading for the 4 x 6 and 6 x 9 foot rugs will be 5703.20.2010, Harmonized Tariff Schedule of the United States (HTS), which provides for carpets and other textile floor coverings, tufted, whether or not made up: of nylon or other polymides: other... measuring not more than 5.25 m2 in area. The duty rate will be 7.5 percent ad valorem.

The applicable subheading for the 9 x 12 foot rug will be 5703.20.2090, HTS, which provides for carpets and other textile floor coverings, tufted, whether or not made up: of nylon or other polymides: other... other. The duty rate will be 7.5 percent ad valorem.

The rugs fall within textile category designation 665. Based upon international textile trade agreements products of China are subject to quota and the requirement of a visa.

The designated textile and apparel categories 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.

The fact that these rugs will be made from United States components raises the possible applicability of subheading 9802.00.80, HTS, which provides for articles assembled abroad in whole or in part of U.S. fabricated components 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. The provision levies a duty upon the full value of the imported item, less the costs or value of the components which are products of the United States, at the same rate that would apply to the imported article were it not subject to subheading 9802.00.80, HTS. Except for possibly the binding tape and the mesh used to back the glued seams, all items are further fabricated (cut to length and width, carved, etc.) and therefore not eligible for consideration under heading 9802, HTS. Your letter provides insufficient detail to determine the applicability of this provision to the binding tape and mesh. Details as to the form of these items when imported into China and as to the exact processes performed on them during the manufacture of the rugs would be necessary to making such a determination.

Also, if the U.S. materials are provided free or at a reduced cost to the Chinese company, the materials constitute an assist as defined in Section 152 of the Customs Regulations (19 CFR 152.102). Under Section 152 of the Customs Regulations, to the extent that the value of the assist is not otherwise included
in the price actually paid or payable for the merchandise, the value of the assist must be added to the price paid or payable for the merchandise in determining the transaction value of the imported merchandise (19 CFR 152.102, 19 CFR 152.103).

This ruling is being issued under the provisions of Section 177 of the Customs Regulations (19 C.F.R. 177).

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.


Jean F. Maguire
Area Director
New York Seaport

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