CBP's Interim Rule on the U.S.-Chile FTA (Part III - Highlights of TPLs for Certain Fabric and Apparel Goods)

CBP states that comments on this interim rule must be received by June 6, 2005.

This is Part III of a multi-part series of summaries on this interim rule, and "highlights" the Tariff Preference Levels (TPLs) for certain cotton or man-made fiber (MMF) fabric or apparel goods (19 CFR 10.420 - 19 CFR 10.425) in new Subpart H ('U.S.-Chile Free Trade Agreement').

(See ITT's Online Archives or 03/08/05 and 03/09/05 news, 05030805 and 05030905, for Parts I and II.)

Various 'Non-Originating' Fabric or Apparel Goods Receive Preferential Tariff Treatment under US-CFTA "Third Country" TPLs

According to new 19 CFR 10.420, a cotton or MMF fabric or apparel good described in new 19 CFR 10.421 that does not qualify as an originating good under new 19 CFR 10.451 may nevertheless be entitled to US-CFTA preferential tariff treatment under an applicable TPL.

To make a TPL claim, the importer must include on the entry summary, or equivalent documentation, the applicable subheading (either HTS 9911.99.20 or 9911.99.40) immediately above the applicable HTS Chapter 52 through 62 subheading under which each non-originating cotton or MMF fabric or apparel good is classified.

Scope of Eligibility for US-CFTA "Third Country" TPLs

According to new 19 CFR 10.421(a) and (b), the following fabric goods are eligible for a US-CFTA TPL claim under HTS 9911.99.20:

Certain woven fabrics of non-originating yarn. Certain woven fabrics of HTS Chapters 52, 54 and 55 (HTS headings 5208 to 5212; 5407 and 5408; 5512 to 5516) that meet the applicable conditions for preferential tariff treatment under the US-CFTA other than the condition that they are originating goods, if they are wholly formed in the U.S. or Chile regardless of the origin of the yarn used to produce these fabrics.

Certain cotton or man-made fabric goods of non-originating fibers/yarn. Certain cotton or man-made fabric goods of HTS Chapters 58 and 60 that meet the applicable conditions for preferential tariff treatment under the US-CFTA other than the condition that they are originating goods if they are wholly formed in the U.S. or Chile regardless of the origin of the fibers used to produce the spun yarn or the yarn used to produce the fabrics. (See interim rule for list of relevant HTS Chapter 58 and 60 numbers.)

According to new 19 CFR 10.421(c), the following apparel goods are eligible for a US-CFTA TPL claim under HTS 9911.99.40:

Certain cotton or man-made apparel goods of non-originating fabric/yarn. Cotton or man-made apparel goods in HTS Chapters 61 and 62 that are both cut (or knit-to-shape) and sewn or otherwise assembled in the U.S. or Chile regardless of the origin of the fabric or yarn, provided that they meet the applicable conditions for preferential tariff treatment under the US-CFTA, other than the condition that they are originating goods.

Certificate of Eligibility To Be Submitted Upon Request to CBP

New 19 CFR 10.422(a) states that an importer who claims preferential tariff treatment on a non-originating cotton or MMF fabric or apparel good must submit, at the request of the port director, a certificate of eligibility containing information demonstrating that the good satisfies the requirements for entry under the applicable US-CFTA TPL, as set forth in new 19 CFR 10.421.

Certificate of eligibility format. Such a certificate of eligibility submitted to CBP need not be in a prescribed format but must be in writing or must be transmitted electronically pursuant to any electronic means authorized by CBP for that purpose.

The certificate of eligibility must include: specified information identifying the importer of record, exporter (if different from producer), and producer (if known); a sufficiently detailed description of the good; HTS classification to six or more digits; the commercial invoice number for a single shipment; the blanket period for multiple shipments (12-month maximum); and the following statement in substantially the following form:

"I Certify that:

The information on this document is true and accurate and I assume the responsibility for proving such representations. I understand that I am liable for any false statements or material omissions made on or in connection with this document;

I agree to maintain and present upon request, documentation necessary to support this certificate, and to inform, in writing, all persons to whom the certificate was given of any changes that could affect the accuracy or validity of this certificate; and

The goods were produced in the territory of one or more of the parties, and comply with the preference requirements specified for those goods in the US-CFTA and HTS Chapter 99, Subchapter XI. There has been no further production or any other operation outside the territories of the parties, other than unloading, reloading, or any other operation necessary to preserve it in good condition or to transport the good to the U.S.; and

This document consists of __ pages, including all attachments."

Responsible official or agent must sign certificate. According to new 19 CFR 10.422(b), the certificate of eligibility must be signed and dated by a responsible official of the importer, or by the authorized agent of the importer who has knowledge of the relevant facts.

Certificate not required for certain importations. New 19 CFR 10.423 indicates that (except in situations where an importation may reasonably be considered to have been carried out or planned for the purpose of evading compliance) an importer will not be required to submit a certificate of eligibility for: (1) a non-commercial importation of a good; or (2) a commercial importation of a good whose value does not exceed $2,500, or the equivalent amount in Chilean currency.

BP has previously referred to the US-CFTA as the UCFTA or CFTA.

(See ITT's Online Archives or 12/27/04 news, 04122725, for BP summary of CBP's notices announcing the 2005 US-CFTA "3^rd Country" TPLs.)

- comments must be received by June 6, 2005

CBP interim rule (CBP Dec. 05-07, FR Pub 03/07/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-4156.pdf

BP Note

HTS Chapter 52 covers cotton; Chapter 54 covers man-made filaments; Chapter 55 covers man-made staple fibers; Chapter 58 covers special woven fabrics, tufted textile fabrics, lace, tapestries, trimmings, and embroidery; Chapter 60 covers knitted or crocheted fabrics; Chapter 61 covers articles of apparel and clothing accessories that are knitted or crocheted; and Chapter 62 covers articles of apparel and clothing accessories that are not knitted or crocheted.