Dec. 24 CBP Bulletin Proposes to Modify Rulings on Garment Country of Origin, Preferential Treatment
In the Dec. 24 issue of the CBP Customs Bulletin (Vol. 48, No. 51), CBP published notices that propose to modify rulings and similar treatment of DR-CAFTA and knit to shape garments. (here). CBP also said it is in the process of updating agency regulation in 19 CFR Section 102.21 that spell out the country of origin provisions.
Comments on Proposals Due Jan. 23
CBP said consideration will be given to any written comments received by Jan. 23 before taking this action. In addition, any party who has received a ruling or decision on the merchandise that is subject to the proposed revocations, or any party involved with a substantially identical transaction, should advise CBP by the date that written comments on the proposed ruling are due. (An importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agents for importations subsequent to the effective date of the final decision in this notice.)
Proposals
CBP is proposing to revoke or modify the rulings below, and any rulings on these products that may exist but have not been specifically identified. CBP is also proposing to revoke or modify any treatment it has previously accorded to substantially identical transactions.
Knit to Shape Garments
| Item: A knit-to-shape undergarment which is knit-to-shape and dyed in China or Korea, then sent to Vietnam for cutting along the lines of demarcation, sewing, assembly and packing. The garment is then shipped to the U.S. |
| Current: A knit-to-shape textile or apparel product is not subject to the “wholly assembled” rule |
| Proposed: Knit-to-shape textile and apparel products derive their origin from the country, territory or possession in which they are knit-to-shape |
| Reason: CBP previously used the rules of origin set forth in 19 CFR Section 102.21 and took into consideration whether the garment was wholly assembled, it said. But the statutory language in the Uruguay Round Agreements Act says knit-to-shape textile and apparel products derive their origin from the country, territory or possession in which they are knit-to-shape. A regulatory provision does not override statutory language and CBP is in the process of modifying 19 CFR Section 102.21, it said. |
| Proposed for revocation: NY N026168 (2008) and NY N024465 (2008) |
| Proposed new ruling: HQ H258586 and HQ H259502 |
Girl's Pullover
| Item: A girl’s pullover with short cap sleeves constructed of 100 percent cotton knitted fabric. The item has a round rib knit neckline and a hemmed bottom. The pullover body has a prominent screen print design. The garment’s waistband has an overlay of sequin covered 100 percent polyester mesh fabric. The cotton knitted fabric and the rib knit capping fabric are produced in the U.S. from imported yarns of Korea and Pakistan. The sewing thread is wholly formed and finished in the U.S. The sequined fabric is made in China. In Guatemala, the fabrics are cut, sewn and assembled into the finished garment and a heat transfer print is applied to the front panel. The garments are exported directly from Guatemala to the U.S. |
| Current: Eligible for preferential tariff treatment under subheading 9822.05.10 |
| Proposed: Ineligible for preferential tariff treatment under subheading 9822.05.10 |
| Reason: The pullover is constructed of fabrics which are wholly formed in the U.S. and a fabric which is made in China, i.e., the sequined polyester mesh fabric waistband overlay, said CBP. But Chapter 98 requires that the good be produced from fabrics wholly formed in the U.S, it said. There is no allowance, or de minimis, for fabrics formed outside the U.S. to be used in the production of garments qualifying the subheading. |
| Proposed for modification: NY N242661 (2013), NY N018963 (2007), and NY N249027 (2014) |
| Proposed new ruling: HQ H252907, HQ H259698, and HQ H259699 |