HQ 950849: Country of origin of babies' diapers.

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 950849

                         March 24, 1992

CLA-2 CO:R:C:T  950849 HP

CATEGORY:  Classification

Mr. Edward T. Strain
Tego Limited
5959 Topanga Canyon Blvd.
Suite 380
Woodland Hills, CA 91367

RE:  Country of origin of babies' diapers.

Dear Mr. Strain:

     This is in reply to your letter of December 5, 1991.  That
letter concerned the country of origin determination of diapers,
produced in China or Mexico.

FACTS:

     The merchandise at issue is the same, but for one difference
described below, as described in HRLs 086549, 086779, and 087585,
all addressed to you.  In HRL 086779 of April 25, 1990, the
merchandise was described as follows:

               The merchandise at issue consists
               of 100% cotton babies' diapers. 
               The following tables describe the
               manufacturing processes.

                     China Production Steps 

1.   100% cotton cloth is woven.
2.   The cloth is shipped to Canada (Now Mexico) on large rolls
     (Now in Bales).

              Canada (NOW Mexico) Production Steps 

1.   Two layers of fabric are placed onto the cutting table.
2.   The fabric is cut to size (24" wide x 16" long).
3.   The sides of the two layers of fabric are folded over (left:
     4" right: 8").
4.   The center panels are sewn using a straight sewing machine.
5.   The sewn fabric is taken to a serging machine, where the top
     and bottom edges are trimmed and overedged.

6.   The threads from all edges are trimmed, as a trailer thread
     of at least 1/2" is required.
7.   The diaper is inspected.
8.   The completed merchandise is packaged into cartons and
     shipped.

As stated above, Country 2 is now Mexico, and the cotton is
exported from China in bales, rather than in rolls.

ISSUE:

     Whether the processes taking place in Canada are sufficient
to change the country of origin for quota/visa purposes from
China?

LAW AND ANALYSIS:

     Textile commodities produced in more than one foreign
country are subject to the country of origin requirements delin-
eated in section 12.130 of the Customs Regulations (19 C.F.R.
 12.130).  These regulations provide that:

          ... a textile product ... which consists of materials
          produced or derived from, or processed in, more than
          one foreign ... country shall be a product of that
          foreign ... country where it last underwent a
          substantial transformation.

 12.130(b).  A textile product undergoes a substantial
transformation when it is ~... transformed by means of
substantial manufacturing or processing operations into a new and
different article of commerce."

     Section 12.130 of the regulations outlines the criteria used
to determine the country of origin for textiles and textile prod-
ucts.  Specifically, this provision of the regulations is
considered in determining whether a textile product has undergone
substantial manufacturing or processing operations, and what con-
stitutes a new and different article of commerce.  The factors
considered are not exhaustive.  In fact, ~one or any combination
of criteria may be determinative, and additional factors may be
considered."

     In determining whether merchandise has undergone substantial
manufacturing or processing operations, we consider the (1)
physical change in the material or the article; (2) time
involved; (3) complexity of the operations; (4) level or degree
of skill and/or technology required; and (5) value added to the
article in each country.

     Section 12.130(e)(2) states that

               [a]n article or material usually will
          not be considered to be a product of a
          particular foreign territory or country, ...
          by virtue of merely having undergone any of
          the following:      
  
                             * * *

                    (ii)  Cutting to length or
                    width and hemming or over-
                    locking fabrics which are
                    readily identifiable as being
                    intended for a particular
                    commercial use.... [Emphasis
                    added.]

     It is clear that this provision does not disqualify the
diapers from consideration as products of Mexico.  Upon
exportation from China, the merchandise is mere cotton fabric,
suitable for multiple uses.  There is no evidence, i.e., lines of
demarcation, that would aid the examiner in determining that the
fabric is meant to be diapers.

     Since there exist no provisions which specifically eliminate
the instant manufacturing processes from consideration, it is our
opinion that the merchandise has undergone a substantial trans-
formation in Mexico.  The merchandise changes from cotton fabric
to children's diapers as a result of Country 2's complex
manufacturing operations.  Following the rules of origin stated
above, therefore, Country 2 is considered the country of origin
for quota/visa purposes.  See also HRL 086665 of March 23, 1990.

HOLDING:

     As a result of the foregoing, the instant merchandise is
considered to be a product of Mexico for quota/visa purposes.

     The holding in this ruling applies only to the specific
factual situation and merchandise identified in the ruling
request. This position is clearly set forth in  177.9(b)(1),
Customs Regulations (19 C.F.R.  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 C.F.R.  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. In such a case, it is recommended that a
new ruling request be submitted in accordance with  177.2,
Customs Regulations (19 C.F.R.  177.2).

     A copy of this ruling letter should be attached to the entry
documents filed at the time this merchandise is imported.  If the
documents have been filed without a copy, this ruling should be
brought to  the attention of the Customs officer handling the
transaction.

                           Sincerely,


                      John Durant, Director
                   Commercial Rulings Division