HQ 085906: Reconsideration of HRL 084534; embroidered caps

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                                      HQ 085906

                                    March 1, 1990



          CLA-2:CO:R:C:G  085906  SR

          CATEGORY:  Classification

          TARIFF NO.:  6505.90.2060

          Mr. Lewis Lau
          Cathco
          100 Dolomite Drive
          Downsview, Ontario
          Canada M3J 2N3

          RE: Reconsideration of HRL 084534; embroidered caps

          Dear Mr. Lau:

               This is in reference to your letter dated October 24, 1989,
          requesting reconsideration of Headquarters Ruling Letter (HRL)
          084534, dated August 24, 1989.

          FACTS:

               The merchandise at issue is baseball caps that are imported
          into Canada, where they are embroidered before being imported
          into the United States.  HRL 084534, classified these hats under
          subheading 6505.90.2060, Harmonized Tariff Schedule of the United
          States Annotated (HTSUSA), as hats and other headwear.  This
          ruling was based on General Note 3(c)(vii)(R)(12) and
          subdivisions (c)(vii)(G)and (H), of the United States-Canada
          Free-Trade Agreement Implementation Act of 1988 (FTA).  The
          importer states the caps are unfinished as they enter Canada
          because most people wear hats with logos.

          ISSUE:

               Whether the caps at issue qualify as Canadian goods under
          the FTA.  





















                                         -2-

          LAW AND ANALYSIS:

               The caps at issue are classifiable under subheading
          6505.90.2060, HTSUSA, as hats and other headgear, whether or not
          the embroidery has been added.

               General Note 3(c)(vii)(B), of the FTA states:

            (B)   for the purposes of subdivision (c)(vii) of this note,
                  goods imported into the customs territory of the United
                  States are eligible for treatment as goods originating in
                  the territory of Canada" only if--

                  (1) they are goods wholly obtained or produced in the
                      territory of Canada and/or the United States, or

                  (2) they have been transformed in the territory of Canada
                      and/or the United States, so as to be subject--

                      (I)  to a change in tariff classification in Canada
                           as described in the rules of subdivision
                           (c)(vii)(R) of this note, or

                      (II) to such other requirements subdivision
                           (c)(vii)(R) of this note may provide when no
                           change in tariff classification occurs, and
                           they meet the other conditions set out in
                           subdivisions (c)(vii)(F), (G), (H), (I), (J),
                           and (R) of this note.

               The requirements for goods classifiable under Chapter 65, of
          the HTSUSA, provided for in subdivision (c)(vii)(R)(12), include
          a change in classification from one chapter to another, or
          several specific changes that are designated within chapter 65.
          Because no change in classification occurs due to the addition of
          the embroidery to the caps, they do not qualify for special rates
          of duty under the FTA.

               The baseball caps at issue are completed articles when they
          are imported into Canada.  They are neither unassembled nor
          dissembled goods.  Therefore, subdivisions (c)(vii)(G) and (H)
          are not applicable to this merchandise; and the value content
          test does not apply.



















                                         -3-

          HOLDING:

               The caps at issue are classifiable under subheading
          6505.90.2060, HTSUSA, which provides for hats and other headgear,
          knitted or crocheted, or made up from lace, felt or other textile
          fabric, in the piece (but not strips), whether or not lined or
          trimmed; other, of cotton, flax or both, not knitted, headwear of
          cotton, other.  The textile category is 359, and the rate of duty
          is 8 percent ad valorem.

               The language in HRL 084534, that discusses whether
          embroidery is considered to be assembly is irrelevant and should
          therefore be revoked.  HRL 084534, dated August 24, 1989, is
          hereby modified accordingly.

                                             Sincerely,




                                             John Durant, Director
                                             Commercial Rulings Division










































          6 cc A.D. New York Seaport
          1 cc Durant
          1 cc legal reference