HQ 957887: Country of origin determination for baseball cap; 19 CFR12.130(b),(d),(e); cutting constitutes substantialtransformation

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 957887

July 25, 1995                    

CLA  R:C:T  957887  jb

CATEGORY:  CLASSIFICATION

Dennis Chia
SuperCap Industrial Co., Ltd.
Tun Hwa S.Rd. Sec. 2
#216, 18 Floor
Taipei, Taiwan
ROC

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

Dear Mr. Chia:

     This letter is in response to your inquiry of April 6, 1995,
requesting a country of origin determination for a variety of
caps and hats.  No samples were submitted to this office for
examination.

FACTS:

     Your letter indicates that the imported merchandise consists
of various articles of headwear which in addition to a baseball
cap, includes berets, driving caps, visors, ladies' hats, outdoor
hats and caps, ivy caps, fishing hats, leather hats and caps,
safari hats and hunting hats.    As you only submitted a diagram
illustrating the composition of the baseball cap's constituent
pieces, this letter will address only the baseball cap.  Without
the aid of samples or diagrams of the remainder of the articles,
we are not able to make a determination for country of origin
purposes.

     You state that the baseball cap will be composed of cotton,
polyester-cotton and wool blend of Taiwan origin.  In Taiwan the
piece goods will be cut into panels and then sent to Korea where
the panels will be assembled by sewing, finished and packaged.   




                  
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). 

     In the case of the subject baseball cap, 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 Taiwan, 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.  See also HQ 086568, dated May 30,
1990 and HQ 957518, dated May 2, 1995, where the country of
origin of baseball caps was also determined to be the country in
which cutting takes place.




HOLDING:

     The country of origin of the submitted baseball cap is
Taiwan.  It is in Taiwan 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