Pillows Origin Determined by Country Where Shell Fabric Made, CBP Rules

Pillows made of Chinese fabric, but constructed in Mexico, are considered Chinese-origin for tariff purposes and subject to Section 301 measures, CBP headquarters said in a recently released ruling.

The ruling came in response to an internal advice request initiated by Encompass Group concerning the country of origin of its imported pillows. The pillows at issue are produced in Mexico in a process that first produces a pillow bun using a polyester stable fiber manufactured in Mexico. The bun is then further refined in a series of operations before being stuffed into the pillow shell in Mexico. The shell is then sewn closed to form the outside of the pillow. Some of the pillow shells are manufactured in China while others are manufactured in Mexico. In either case, the shells are made from Chinese-origin fabrics.

Encompass argued that the pillow shells and fabrics were substantially transformed into products of Mexico during the manufacturing process and cited several past headquarters and New York office ruling letters. CBP disagreed. Since the merchandise at issue is pillows with a textile outer shell, they are considered textile products, CBP said, and the country of origin of textile products shall be determined by the sequential application of the general rules found in 19 CFR 102.21.

The relevant general rule states that the country of origin of a good classified under subheading 9404.90 is the country in which the fabric was formed by a fabric-making process, CBP ruled. The term “fabric-making process” is defined as “any manufacturing operation that begins with polymers, fibers, filaments, yarns, twine, cordage, rope, or fabric strips and results in a textile fabric.” The fabrics comprising the goods in this instance are the fabrics of the pillow shell, CBP said. Because the base pillow shell fabrics were manufactured in China, CBP found that the fabric-making process occurred in China and the country of origin of the pillows is therefore China.

CBP said that rulings cited by Encompass to argue the contrary are not authoritative because many of the considered products were not textiles with different rules of origin. The three cited HQ rulings were issued prior to July 1, 1996, when the process of determining the country of origin of textile products was different and were therefore inapplicable, the agency said.