HQ 087648: Classification and country of origin of fabrics woven and embroidered in India and dyed in Canada

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 087648

                                   February 7, 1991


            CLA-2 CO:R:C:T  087648 DRR

            CATEGORY:  Classification

            TARIFF NO.: 5810.91.0010

            Ms. Frances Jones
            J. Ovington Fabrics Ltd.
            2142 Marne St.
            Victoria, British Columbia, Canada V854J9

            RE:  Classification and country of origin of fabrics woven and
                 embroidered in India and dyed in Canada

            Dear Ms. Jones:

                 This is in response to your letter of June 20, 1990, in
            which you requested a tariff classification ruling, under the
            Harmonized Tariff Schedule of the United States Annotated
            (HTSUSA), for two samples of fabric.

            FACTS:

                 The merchandise at issue is represented by two sample
            swatches of 100 percent handloomed cotton fabric embroidered
            with 100 percent wool yarn.  The samples weigh 241 grams per
            square meter.  The fabric is loomed and embroidered in India
            according to designs which originate in Canada and exported to
            Canada where some will be sold as imported and some will be
            dyed to order.  The undyed fabric costs US $11.40 per meter,
            the cost of the dyeing averages US $18.00 per meter.  The
            fabric is intended to be used in upholstery.

            ISSUE:

                 What is the classification of the fabric in question.

            LAW AND ANALYSIS:

                 Classification of merchandise under the HTSUSA is in
            accordance with the General Rules of Interpretation (GRI),
            taken in order.  GRI 1 provides that classification shall be
            determined according to the terms of the headings and any
















                                          -2-

            relative section or chapter notes.  Heading 5810, HTSUSA,
            provides for embroidery in the piece, in strips or in motifs.
            Subheading 5810.91.0010, HTSUSA, provides for embroidery in the
            piece, in strips or in motifs, other embroidery, of cotton
            weighing over 200 g/m.  According to additional Note 1, Chapter
            58, embroidery in the piece of subheading 5810.91 is dutiable
            at 8.4 percent ad valorem, but not less than the rate of duty
            that would apply if the fabric were not embroidered.  If
            unembroidered, the undyed sample would be classifiable in
            subheading 5209.19.00, HTSUSA.  The dyed sample would be
            classifiable under subheading 5209.39.00, HTSUSA.  If the dyed
            sample is certified handloomed, it would be classifiable under
            subheading 5209.31.3000, HTSUSA.

                 Section 12.130, Customs Regulations (19 CFR 12.130, copy
            enclosed), provides, in pertinent part, that a textile or
            textile product which consists of materials produced or derived
            from, or processed in, more than one foreign territory or
            country, or insular possession of the U.S., shall be a product
            of that foreign territory or country, or insular possession
            where it last underwent a substantial transformation.  A
            textile or textile product will be considered to have undergone
            a substantial transformation if it has been transformed by
            means of substantial manufacturing or processing operations
            into a new and different article of commerce.  A new and
            different article of commerce will usually result from a
            manufacturing or processing operation if there is a change in
            commercial designation or identity, fundamental character or
            commercial use.  The criteria used to determine whether a
            substantial transformation has taken place include the physical
            change in the article, the time, complexity and value added by
            the operation.  Section 12.130 (e)(2)(v), Customs Regulations
            states that the dyeing and/or printing of yarn or fabric is
            insufficient processing to constitute a substantial
            transformation.

                 With regard to the eligibility of the fabric for special
            tariff treatment under the United States-Canada Free Trade
            Agreement Implementation Act of 1988, the dyeing of the fabric
            in Canada does not result in a change of classification under
            General Note 3(c)(vii)(R)(11), HTSUSA.  Accordingly the fabric
            is subject to the rates of duty in the "General" subcolumn.




















                                       - 3 -

            HOLDING:

                 The fabrics in question are classified under subheading
            5810.91.0010, HTSUSA.  The undyed fabric is dutiable at a rate
            of 8.4 percent ad valorem.  The dyed fabric, if not certified
            handloomed, is dutiable at a  rate of 8.9 percent ad valorem.
            In either condition, the fabric is subject to textile visa
            category 229.  If the fabric is handloomed and hand embroidered
            and certified as exempt, it would be dutiable at a rate of 8.4
            percent ad valorem, even if dyed.  Shipments not accompanied by
            the exemption certificate would require a normal circular visa
            and may be subject to quota restraint levels.  The country of
            origin of both the dyed and undyed fabric is India.

                 Your question as to the proper marking of the fabric has
            been referred to our Value and Marking Branch.  They will
            respond to you under separate cover.  Your question about the
            procedures applicable while the fabric is in Canada should be
            addressed to Canadian Customs.

                 Due to the changeable nature of the statistical annotation
            and the restraint (quota/visa) categories applicable to textile
            merchandise, you should contact the local Customs office prior
            to importation of this merchandise to determine the current
            status of any import restraints or requirements.

                 The designated textile and apparel category may be
            subdivided into parts.  If so, visa and quota requirements
            applicable to the subject merchandise may be affected.  Since
            part categories are the result of international bilateral
            agreements which are subject to frequent renegotiations and
            changes, we suggest that you check, close to the time of
            shipment, the Status Report on Current Import Quotas (Restraint
            Levels), an internal issuance of the U.S. Customs Service,
            which is available for inspection at your local Customs office.

                                       Sincerely,




                                       John Durant, Director
                                       Commercial Rulings Division



















            drimmer library / 087648
            6cc: A.D., N.Y. Seaport
            DRimmer:jaj:02/07/91