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HQ 958923

April 4, 1996

CLA - 2 RR:TC:TE 958923 CAB


Mr. Michael Riley
May Department Stores International
615 Olive Street
18th Floor
St. Louis, MO 63101

RE: Country of origin of various garments; Section 12.130, Customs Regulations; Section 102.21, Customs Regulations

Dear Mr. Riley:

This is in response to your inquiry of December 24, 1995, requesting a country of origin determination for men's shorts and pants. No samples were submitted to Customs Headquarters for examination.


The merchandise at issue consists of two pieces each of twill shorts, madras shorts, and Oxford short sleeve shirts. The manufacturing operations in the Maldives are as follows:

1. Fabric, pocketing and accessories will be imported from countries such as Taiwan, Hong Kong, Singapore, India and Sri Lanka into a factory in the Maldives.

2. The fabric is then cut into garment pieces.

3. The cut components are then assembled into complete garments.

4. The garments are then shipped to Sri Lanka in cloth bags which are lined with polythene for the further processing of washing, finishing, packing, and exportation to the United States.

The manufacturing operations in Sri Lanka are as follows:

1. The garments are washed in accordance to buyer standards (i.e., normal wash, enzyme wash, or bleach wash).

2. The garments are then trimmed and assessed for washing damages.

3. The garments are ironed and further examined.

4. The garments are hang tagged and packaged for export to the United States.


What is the country of origin of the subject merchandise?


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 subsequent 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 in the manufacturing or processing operations; and

(v) The value added to the article or material.

Section 12.130(e)(1), Customs Regulations, describes manufacturing or processing operations from which an article will usually be considered a product of the country in which those operations occurred. Section 12.130(e)(1)(iv), Customs Regulations, specifically provides that the cutting of fabric into parts and the assembly of those parts into the completed article will be a manufacturing operation that will usually result in an article being considered a product of the country in which those operations occurred.

According to T.D. 85-38, the final document rule establishing 19 CFR 12.130:

The assembly of all the cut pieces of a garment usually is a substantial manufacturing process that results in an article with a different name, character, or use than the cut pieces. It should be noted that not all assembly operations of cut garment pieces will amount to a substantial transformation of those pieces. Where either less than a complete assembly of all the cut pieces of a garment is performed in one country, or the assembly is a relatively simple one, then Customs will rule on the particular factual situation as they arise, utilizing the criteria in Section 12.130(d).

Customs has consistently determined that cutting fabric into garment pieces constitutes a substantial transformation of the fabric and the clothing pieces become products of the country where the fabric is cut. (See e.g., Headquarters Ruling Letter (HRL) 952531, dated November 25, 1992, and HRL 089539, dated April 22, 1992).

Customs has also long held that the mere assembly of goods entailing simple combining operations, trimming or joining together by sewing is not enough to substantially transform the components of an article into a new and different article of commerce. (See e.g.,HRL 082787, dated March 9, 1989, and HRL 082747, dated February 23, 1989).

In this instance, the washing and packaging in Sri Lanka are simple finishing operations that amount to the simple manufacturing operations cited in Section 12.130(e)(2)(i) & (iv). The amount of time and cost of the manufacturing operations in the Maldives are significantly more than the time expended and cost of the manufacturing operations in Sri Lanka. The manufacturing operations in Sri Lanka do not confer country of origin because they do not amount to substantial manufacturing operations. The cutting and assembly process completed in the Maldives, however, is a substantial manufacturing operation specifically provided for in Section 12.130(e)(1)(iv). Therefore, the garments in question are products of the Maldives.


The country of origin of the subject merchandise is the Maldives pursuant to Section 12.130, Customs Regulations.

You should be aware that on December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act provides new rules of origin for textiles and apparel entered, or withdrawn from warehouse, for consumption, on and after July 1, 1996. On September 5, 1995, Customs published Section 102.21, Customs Regulations, in the Federal Register, implementing Sect. 334 (60 FR 46188). Section 334 generally provides, with certain exceptions, that the origin of textile goods will be the country in which they are assembled. The subject articles are not within the products excepted from the assembly rule. Accordingly, based on the facts stated above, effective July 1, 1996, the country of origin of the subject garments remains the Maldives.


John Durant, Director
Tariff Classification Appeals

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