HQ 957518: Country of origin determination for baseball cap andneoprene glove; 19 CFR 12.130(b),(d),(e); cuttingconstitutes substantial transformation

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 957518

May 2, 1995                      

CLA  R:C:T  957518  jb

CATEGORY:  CLASSIFICATION

William Mok
Overseas Sourcing Limited
1370 Broadway, Suite 1004
New York, NY 10018

RE:  Country of origin determination for baseball cap and
neoprene glove; 19 CFR        12.130(b),(d),(e); cutting
constitutes substantial transformation 

Dear Mr. Mok:

     This letter is in response to your inquiry of January 6,
1995, on behalf of your client, Sam Jung Hwagong Co. Ltd.,
requesting a country of origin determination for a baseball cap
and neoprene glove.  Samples were submitted to this office for
examination.

FACTS:

     Your letter indicates that the imported merchandise consists
of various articles, which in addition to the baseball cap and
neoprene glove, includes a fishing wader and diving suit. 
Insufficient information was submitted in regard to the fishing
wader and diving suit.  Particularly, though you indicate the
cost breakdown for the manufacturing processes, you neither
provide information as to the number of constituent pieces for
each good nor the type of assembly that is involved, i.e.,
skilled or non-skilled.  In addition, no samples of the fishing
wader or diving suit 
were submitted to this office to aid us in making a
determination.  Accordingly, this letter will address only the
baseball cap and neoprene glove.

     You state that the baseball cap and neoprene glove will be
manufactured by either of the following processes:

     CASE A                                                       
       CASE B

     cutting Korean piece goods in Korea                    
cutting Korean piece goods in Korea 
     complete assembly in Vietnam                              
partial assembly in Vietnam 
                                           final assembly and
finishing in Korea                         
ISSUE:
     
     What is the country of origin of the merchandise at issue?

LAW AND ANALYSIS:

     Section 12.130 of the Customs Regulations (19 CFR 12.130)
sets forth the principles of country of origin for textiles and
textile products subject to Section 204 of the Agricultural Act
of 1956, as amended (7 U.S.C. 1854).

     Pursuant to 19 CFR 12.130(b), the standard of substantial
transformation governs the country of origin determination where
textiles and textile products are processed in more than one
country.  The country of origin of textile products is deemed to
be that foreign territory or country where the article last
underwent a substantial transformation.  Substantial
transformation is said to occur when the article has been
transformed into a new and different article of commerce by means
of substantial manufacturing or processing.
     
     The factors to be applied in determining whether or not a
manufacturing operation is substantial are set forth in 19 CFR
12.130(d)(2).  The following are considered:

     (i) The physical change in the material or article;

           (ii) The time involved in the manufacturing or
processing;

          (iii) The complexity of the manufacturing or
processing;

          (iv) The level or degree of skill and/or technology
required in the manufacturing or                           
processing operations;

           (v) The value added to the article or material;  

     Section 12.130(e)(1) describes manufacturing or processing
operations from which an article will usually be considered a
product of the country in which those operations occurred:  

     (i) Dyeing of fabric and printing when accompanied by two or
more of the following                  finishing operations:
bleaching, shrinking, fulling, napping, decating, permanent                                  stiffening, weighting, permanent
embossing, or moireing; 
    
          (ii) Spinning fibers into yarn;

         (iii) Weaving, knitting or otherwise forming fabric;
   
         (iv) Cutting of fabric into parts and the assembly of
those parts into the completed article; or
          (v) Substantial assembly by sewing and/or tailoring of
all cut pieces of apparel articles          which have been cut
from fabric in another foreign territory or country, or insular      possession, into a completed garment (e.g., the complete
assembly of all cut pieces of          suit-type jackets, suits
and shirts).

     We have previously held that cutting of fabric into pattern
pieces constitutes a substantial transformation of the fabric,
resulting in the apparel pieces becoming a product of the country
where the fabric is cut.  (See Headquarter Ruling Letter (HQ)
955125, dated January 27, 1994; HQ 953697, dated July 26, 1993;
and HQ 952531, dated November 25, 1992). 
        
      As was stated by Customs in Treasury Decision (T.D.) 85-38
(19 Cust. Bull. 58, 70; 50 FR 8714), the final document rule
establishing 19 CFR 12.130, in pertinent part:

     [T]he assembly of all cut pieces of a garment usually is a
substantial manufacturing     process that results in an article
with a different name, character or use than the cut   pieces. 
It should be noted that not all assembly operations of cut
garment pieces will      amount to a substantial transformation
of those pieces.  Where either less than          complete
assembly of all the cut pieces of a garment is performed in one
country, or the     assembly is a relatively simple one, then
Customs will rule on the particular factual  situations as they
arise, utilizing the criteria in section 12.130(d).
     
     Customs has consistently held that the mere assembly of
goods by simple sewing, is not enough to substantially transform
the components of an article into a new and different article of
commerce (See HQ 082747, dated February 23, 1989; HQ 086665,
dated March 23, 1990; HQ 951169, dated April 1, 1992; HQ 951437,
dated July 17, 1992; and HQ 952647, dated January 27, 1993). 
Customs has also held that sub-assembly operations are considered
only a minor part of the complete assembly of merchandise and
should not control country of origin determinations (See HQ
953638, HQ 953639, HQ 953640 and HQ 953641, dated August 19,
1993).
     
     In the case of the subject baseball cap and neoprene glove,
the assembly operations are minor combining and sewing operations
and do not possess the requisite degree of complexity to be
deemed substantial manufacturing processes for purposes of
conferring country of origin status.  No great degree of skill or
technology is required, nor is tailoring involved. (See, HQ
954583, dated August 18, 1993; HQ 954446, dated August 11, 1993;
HQ 952916, dated January 29, 1993; and HQ 952918, dated January
29, 1993).  

     The operations performed in Korea i.e., cutting the fabric,
materially changes the fabric into designated pieces.  This
constitutes a substantial transformation of the fabric and
confers country of origin.  




HOLDING:

     The country of origin of the submitted baseball cap and
neoprene glove is Korea.  It is in Korea where the cutting takes
place and where the fabric last undergoes a substantial
transformation and is transformed into new and different articles
of commerce.  

     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 the ruling letter,
either directly, by reference, or by implication, is accurate and
complete in every material respect.  

     Should it be subsequently 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 affect 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
                              Commercial Rulings Division