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NY H82121

June 21, 2001

CLA-2-64:RR:NC:TA:347 H82121


TARIFF NO. 6401.92.90

Mr. Rodney Ralston
Trans-Border Customs Services, Inc.
One Trans-Border Drive
P.O. Box 800
Champlain, NY 12919

RE: The tariff classification of footwear made in Canada.

Dear Mr. Ralston:

In your letter dated June 4, 2001, you requested a classification ruling for a rubber boot, outsole and insole proposing two different scenarios for your client Genfoot America, Inc.

You describe the possible scenarios as follows:

1) The boot is made in Canada, the outsole (made in Korea) is attached, the insole (also made in Korea) is inserted, the completed boots are boxed and shipped to the U.S. through the port of Champlain, N.Y.

2) The boot is made in U.S., then shipped to Canada where the Korean outsole is attached, Korean insole inserted, boxed and returned to the U.S.

The finished item is a waterproof boot covering the ankle but not the knee, other. The applicable subheading for the finished boot will be 6401.92.90, Harmonized Tariff Schedule of the United States, (HTSUSA) which provides for Waterproof footwear with outer soles and uppers of rubber or plastics, the uppers of which are neither fixed to the sole nor assembled by stitching, riveting, nailing, screwing, plugging or similar processes, other, not covering the ankle, designed to be worn over, or in lieu of, other footwear as a protection against water, oil, grease or chemical or cold or inclement weather, other. The general rate of duty will be 37.5 percent ad valorem.

Article 401(b) to the North American Free Trade Agreement, (NAFTA), indicates that goods may “originate” in Canada, Mexico or the United States, even if they contain non-originating materials, if the materials satisfy the rule of origin specified in Annex 401 of the agreement. The Annex 401 rules of origin are commonly referred to as specific rules of origin and are based on a change in tariff classification, a regional value-content requirement or both. Annex 401 is organized by HTS number, so one must know the HTS number of a good, and the HTS numbers for all the non-NAFTA materials used to produce the good, to find its specific rule of origin and determine if the rule has been met. Annex 401 gives the applicable rule of origin opposite the HTS number.

HTSUSA, General Note 12(t) 64 defines changes in tariff classification required to determine origin for footwear and footwear parts. It reads in pertinent part that:

A change to subheading 6401-6405 from any heading outside that group, except from subheading 6406.10, provided there is a regional value content of not less than 55 percent under the net cost method.

For the purposes of this ruling, we assume that the regional value content requirement has been met. Since the boot portion of the completed footwear is a product of either Canada or the United States and the foreign components are not classified in subheading 6406.10 (uppers and parts of uppers) the origin of the completed footwear is either Canada or the United States. Each of the non-originating materials used to make the completed footwear has satisfied the changes in tariff classification required under HTSUSA GN 12(t) 64. The completed footwear will be entitled to a Free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.

Regarding the country of origin marking requirements, Section 134.1(b), Customs Regulations [19 CFR 134.1(b)] defines “country of origin” as the country of manufacture, production or growth of any article of foreign origin entering the U.S. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the “country of origin” within the meaning of the marking laws and regulations. Section 10.14(b) provides that a “substantial transformation” occurs when, as a result of manufacturing processes, a new and different article emerges, having a distinctive name, character, or use, which is different from that originally possessed by the article or material before being subject to the manufacturing process. If the manufacturing or combining process is merely a minor one, which leaves the identity of the article intact, a substantial transformation has not occurred. In this regard the boot portion of the completed footwear, merely being attached to a foreign outer sole in Canada does not undergo a substantial transformation.

This ruling is being issued under the provisions of Part 177 and Part 181of the Customs Regulations (19 C.F.R. 177 and 181).

A copy of this ruling letter or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding this ruling, contact National Import Specialist, Richard Foley at (212) 637-7089.


Robert Swierupski

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