HQ 953590: Country of origin of certain yarn

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 953590

                         April 22, 1993

CLA-2 CO:R:C:T 953590 CMR

CATEGORY: Classification

Mr. Jack Schachter
Cansew, Inc.
111 Chabanel  O/W
Montreal, Quebec
Canada  H2N 1C9

RE: Country of origin of certain yarn

Dear Mr. Schachter:

     This ruling is in response to your request of November 6,
1992, and supplemental submissions, regarding the determination of
the country of origin of certain yarn processed in Canada.  We did
not receive your supplemental submissions until recently and regret
the delay in responding.

FACTS:

     The yarn at issue is subject to processing in Thailand and
Canada.  The processing which is performed in Thailand is as
follows:

     1. Manufacturing of the fiber;

     2. Spinning of the fiber into singles yarn;

     3. Twisting and doubling of singles into finished yarn; and,

     4. Winding the yarn onto cones or dye tubes.

     The yarn is then exported to Canada.  In Canada, the yarn is
subjected to the following processes:

     1. Winding operations to achieve even package density;

     2. Autoclave yarn to preshrink;

     3. Bleaching, dyeing and lubricating yarn; and,

     4. Final winding of yarn onto cones, etc.
                               -2-


     The yarns are raw, white, and twisted "S" in the single and
"Z" in the ply.  From your listing of processes, it appears the
singles are plied (doubled) and given a "Z" twist in Thailand.

     The average value of the yarn upon exportation from Thailand
is $1.62 (US), FOB Thailand.  You did not provide any information
regarding the time factor for the processes in Thailand.

     The processes which occur in Canada increase the value of the
yarn by $2.87 (US) per pound.  It requires at a minimum 6 1/2 hours
to perform all of the processing in Canada.

ISSUE:

     Is the country of origin for the yarn at issue Thailand or
Canada?

LAW AND ANALYSIS:

     Country of origin determinations for textile articles are
governed by the criteria set forth in Volume 19 of the Code of
Federal Regulations, Section 12.130 (19 CFR 12.130).  The
regulation provides that a textile or textile article which is
produced or derived, or processed in, more than one foreign
territory or country, or U.S. insular possession, shall be a 
product of that place where it last underwent a substantial
transformation.  19 CFR 12.130(b).  

     Section 12.130(d) sets out the basic guidelines for
determining the country of origin of textiles or textile articles. 
While not exhaustive, it enumerates various criteria utilized in
determining whether a new and different article of commerce is
created as a result of a manufacturing or processing operation and
whether such operations are considered substantial.

     Section 12.130(e)(1) lists various processes which are
considered sufficient to convey origin when performed in a foreign
territory or country, or U.S. insular possession, prior to
importation into the United States.  Among the processes listed is
the spinning of fibers into yarn.  In your letter, you indicate
that the fibers are spun into yarn in Thailand.  At that point, the
fibers have undergone a substantial transformation and Thailand is
considered the country of origin of the yarn.

     In order to change the country of origin of the yarn after
importation into Canada, the yarn must undergo another substantial
transformation in Canada.  Section 12.130(e)(2) provides for
processes which will not substantially transform textiles.  These
processes include: 
                               -3-


     Simple combining operations, *  *  * , or packaging
     operations, *  *  * ; 

     One or more finishing operations on yarns, fabrics, or other
     textile articles, such as showerproofing, superwashing,
     bleaching, decating, fulling, shrinking, mercerizing, or
     similar operations; [and]

     Dyeing and/or printing of fabrics or yarns.

     The processes which the yarn will undergo in Canada fall
squarely within the above listed operations.  Winding onto cones
is viewed as a simple operation in preparation for the finishing
operations and afterwards as a packaging operation.  Shrinking,
bleaching and dyeing are finishing operations which are
specifically named in section 12.130(e)(2).  Lubrication of the
yarn is viewed as a similar operation.

     Although the value added to the yarn in Canada is greater than
the value of the yarn as exported from Thailand, the processing
operations performed in Canada are not viewed as  substantial nor
as transforming the yarn into a new and different article.

HOLDING:

     The country of origin of the yarn at issue is Thailand.

     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 177.9(b)(1), Customs
Regulations (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 connection with the ruling request and
incorporated in the ruling letter, either directly, by reference,
or by implication is accurate and complete in every material
respect.  Should it subsequently be 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 effect the determination of country of origin. 
Accordingly, it is recommended that a new ruling request be
submitted in accordance with section 177.2, Customs Regulations (19
CFR 177.2).

                                   Sincerely,



                                   John Durant, Director