United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1998 HQ Rulings > HQ 960803 - HQ 960950 > HQ 960854

Previous Ruling Next Ruling
HQ 960854





April 22, 1998

CLA-2 RR:TC:TE 960854 jb

CATEGORY: CLASSIFICATION

Larry Horowitz
3-D Products & Designs Inc.
618 Reyes Dr.
Walnut, CA 91789

RE: Country of origin determination for buckwheat hull filled neck pillow; NAFTA; 19 CFR ?102.21(c)(2); tariff shift;

Dear Mr. Horowitz:

This is in reply to your letter dated July 9, 1997, requesting a country of origin determination for certain buckwheat hull filled neck pillows. A sample was submitted to this office for examination.

FACTS:

The submitted merchandise, a buckwheat hull filled neck pillow, is composed of two parts- a pillow, made of 100 percent cotton twill fabric, and pillow cover made from 100 percent cotton muslin. The pillow measures approximately 17.5 inches by 23.5 inches and features a neck roll section. The pillow cover has openings at both ends and is designed specifically to accommodate the pillow insert.

Scenario I

China buckwheat hulls are sourced fabric for pillow shell is woven, cut and assembled fabric for pillow case is woven, cut and assembled

Mexico filling of pillow packing

Scenario II

China buckwheat hulls are sourced

Mexico fabric for pillow shell is woven, cut and assembled fabric for pillow case is woven, cut and assembled filling of pillow packing

Scenario III

China buckwheat hulls are sourced fabric for pillow shell is woven, cut and assembled

Mexico fabric for pillow case is woven, cut and assembled filling of pillow packing

Scenario IV

China buckwheat hulls are sourced fabric for pillow case is woven, cut and assembled

Mexico fabric for pillow shell is woven, cut and assembled filling of pillow packing

ISSUE:

1. What is the country of origin of the submitted merchandise?

2. Whether the subject merchandise is eligible for NAFTA treatment?

LAW AND ANALYSIS:

Classification

Classification of merchandise under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is in accordance with the General Rules of Interpretation. GRI 1 requires that classification be determined according to the terms of the headings and any relative section or chapter notes. Where goods cannot be classified solely on the basis of GRI 1, the remaining GRI will be applied, in the order of their appearance.

The article at issue is made up of different components- a pillow cover, classifiable in heading 6304, HTSUS, and small pillow insert, classifiable in heading 9404, HTSUS. As the article is prima facie classifiable under different HTSUS headings, it cannot be classified pursuant to GRI 1. GRI 3 is applicable in this case and states, in pertinent part:

When by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings classification shall be effected as follows:

(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

The Explanatory Notes to the Harmonized Commodity Description and Coding System (EN) for GRI 3(b) defines "composite goods made up of different components" as:

XI. ...not only those in which the components are attached to each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts.

The article at issue consists of separable components which meet the definition of composite goods. It is the opinion of this office that the pillow insert and cover are adapted to fit one another, are mutually complementary and would not normally be offered for sale separately. Accordingly, as the articles are classifiable as composite goods, the classification is based on the component which imparts the essential character to the good. EN VII to GRI 3(b) states:

The factor which determines the essential character will vary as between different kinds of goods. It may for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.

The pillow comprises the essential character of the pillow cover and pillow. It provides the bulk, the weight and the form to the item. Heading 9404, HTSUS, provides for, among other things, articles of bedding and similar furnishings. Although size specifications are not explicitly outlined in the terms of heading 9404, HTSUS, Customs has held that so long as pillows are sufficient in size and stuffing to be capable of providing support, classification in heading 9404, HTSUS, is not excluded. Accordingly, it is the opinion of this office that the subject pillow is adequate in size to provide support and thus, is properly classified in heading 9404, HTSUS.

NAFTA Eligibility

The subject pillow undergoes processing operations in Mexico which is a country provided for under the North American Free Trade Agreement (NAFTA). General Note 12, HTSUSA, incorporates Article 401 of the North American Free Trade Agreement (NAFTA) into the HTSUSA. Note 12(a) provides, in pertinent part:

(ii) Goods that originate in the territory of a NAFTA party under subdivision (b) of this note and that qualify to be marked as goods of Mexico under the terms of the marking rules... and are entered under a subheading for which a rate of duty appears in the "Special" subcolumn followed by the symbol "MX" in parentheses, are eligible for such duty rate... . [Emphasis added]

Accordingly, the pillow at issue will be eligible for the "Special" "MX" rate of duty provided it is a NAFTA "originating" good under General Note 12(b), HTSUSA, and it qualifies to be marked as a good of Mexico. Note 12(b) provides, in pertinent part:

For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--

(i) they are goods wholly obtained or produced entirely in the territory of Canada,
Mexico and/or the United States; or

(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--

(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or,

(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or

(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or

The subject merchandise qualifies for NAFTA treatment only if the provisions of General Note 12(b)(ii)(A) are met, that is, if the merchandise is transformed in the territory of Mexico so that the non-originating materials (the hulls and fabric formed in China) undergo a change in tariff classification as described in subdivision (t).

For the pillow, subdivision (t), Chapter 94, rule 7, states that:

A change to subheading 9404.90 from any other chapter, except from headings 5007, 5111 through 5113, 5208 through 5212, 5309 through 5311, 5407 through 5408 or 5512 through 5516.

In scenario II, the fabric for the pillow shell and cover is wholly obtained or produced in Mexico. When the hulls from China are added to the pillow, they undergo the required tariff shift and thus qualify the pillow for NAFTA treatment.

In scenario I, when the pillow shell and cover from China are sent to Mexico, in scenario III, when the pillow shell from China is sent to Mexico, and in scenario IV when the pillow case from China is sent to Mexico, these articles are classified in either heading 6307, HTSUS, (incomplete pillow shell) or heading 6304, HTSUS, (pillow cover). As these headings are not excepted by subdivision (t) for subheading 9404.90, HTSUS, the non-originating material(s) from China do undergo the requisite change in tariff classification. Accordingly, the merchandise in scenarios I, III and IV are also eligible for the NAFTA preference.

Country of origin

On December 8, 1994, the President signed into law the Uruguay Round Agreements Act. Section 334 of that Act (codified at 19 U.S.C. 3592) 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 Section 334 (60 FR 46188). Thus, effective July 1, 1996, the country of origin of a textile or apparel product shall be determined by sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.

Paragraph (c)(1) states that "The country of origin of a textile or apparel product is the single country, territory, or insular possession in which the good was wholly obtained or produced." As the subject merchandise is not wholly obtained or produced in a single country, territory or insular possession, paragraph (c)(1) of Section 102.21 is inapplicable.

Paragraph (c)(2) states that "Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) of this section, the country of origin of the good is the single country, territory, or insular possession in which each foreign material incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement, specified for the good in paragraph (e) of this section".

Paragraph (e) states that "The following rules shall apply for purposes of determining the country of origin of a textile or apparel product under paragraph (c)(2) of this section":

9404.90 The country of origin of a good classifiable under subheading 9404.90 is the country, territory, or insular possession in which the fabric comprising the good was formed by a fabric-making process.

The subject merchandise is classifiable in subheading 9404.90, HTSUS. In scenarios I and III, as the fabric comprising this merchandise is formed in a single country, that is China, the country of origin of the subject merchandise is China. However, as stated in section 102.19(a):

Except in the case of goods covered by paragraph (b) of this section, if a good which is originating within the meaning of ?181.1(q) of this chapter is not determined under ?102.11(a) or (b) or ?102.21 to be a good of a single NAFTA country, the country of origin of such good is the last NAFTA country in which that good underwent production other than minor processing, provided that a Certificate of Origin (see ?181.11 of this chapter) has been completed and signed for the good.

Accordingly, provided the requirements of section 102.19(a) are met, the country of origin of the subject merchandise in scenarios I and III is Mexico.

In scenarios II and IV, as the fabric comprising the pillow shell is formed in Mexico, as per the terms of the tariff shift, the country of origin of the subject merchandise is Mexico.

HOLDING:

The subject buckwheat hull filled neck pillow is properly classified in subheading 9404.90.1000, HTSUSA, which provides for mattress supports; articles of bedding and similar furnishing (for example, mattresses, quilts, eiderdowns, cushions, pouffes and pillows) fitted with springs or stuffed or internally fitted with any material or of cellular rubber or plastics, whether or not covered: other: pillows, cushions and similar furnishings: of cotton. The applicable rate of duty is 5.7 percent ad valorem and the quota category is 369.

In scenarios I, II, III and IV, the country of origin of the subject pillow is Mexico and the merchandise is eligible for NAFTA treatment.

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.

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 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 the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.

Should it be subsequently 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, if there is any change in the facts submitted to Customs, it is recommended that a new ruling request be submitted in accordance with 19 CFR 177.2.

Sincerely,

John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling

See also: