Ms. Deana Norton
La-Z-Boy Canada Limited
One La-Z-Boy Drive
Monroe, Michigan 48162
Date of issuance of ruling:
This is in response to your request for an advance ruling (AR) on the originating status under the North American Free Trade Agreement (NAFTA) of Decorative Pillows. These products are produced by La-Z-Boy Inc. in Dayton, Tennessee and Siloam Springs, Arkansas.
The subject goods are decorative, textile accent cushions for La-Z-Boy furniture (generic part numbers 08P201, 08P211, 08P220, 08P222, 08P228, 08P240, 08P242, 08P250, 08P260, 08P262). These cushions are of various shapes and sizes ranging from 8 ½" x 22" to 24" x 24". When imported into Canada, these cushions are classified under subheading 9404.90 of the Customs Tariff.
The information provided with your submission indicates that different types of fabric from various non-originating countries are imported into Mexico, where it is cut and sewn into cushion covers at the facility of a related company. These covers have finished seams on three sides and a zipper opening on the fourth side. The covers are then exported to the United States where they are declared as non-originating goods classified under subheadings 6304.91, 6304.92, 6304.93, or 6304.99, depending upon their fabric of composition. After importation, the covers are shipped to La-Z-Boy Inc.'s manufacturing facilities in Tennessee and Arkansas.
At these facilities, cushion shells of heading 63.07 are filled with originating blown polyester fibre of heading 55.03 and sealed closed. The filled cushion shells are then inserted into the cushion covers, thus forming the finished decorative cushions.
Analysis and Justification
At issue is whether the decorative cushions qualify for preferential NAFTA tariff treatment under the NAFTA Rules of Origin Regulations. In order to qualify as an originating good, any non-originating materials used in the production of the finished cushions must meet the requirements of the Specific Rules of Origin found in Schedule I of the NAFTA Rules of Origin Regulations and satisfy all other applicable requirements of the Regulations.
The specific rule of origin for goods of subheading 9404.90 requires a "change to subheading 9404.90 from any other chapter, except from headings 50.07, 51.11 through 51.13, 52.08 through 52.12, 53.09 through 53.11, 54.07 through 54.08 or 55.12 through 55.16". The non-originating cushion shells of heading 63.07 meet the required tariff shift as result of production occurring entirely in the United States by La-Z-Boy Inc.
Accordingly, the decorative cushions are considered originating goods under Article 401(b) of the NAFTA and are entitled to the benefits of the preferential tariff treatment.
This AR has been issued under paragraph 43.1(1)(a) of the Customs Act and Article 509 of the NAFTA. It will be honoured by the CBSA for future importations of the goods specified, provided the material facts and circumstances remain as originally presented; all conditions in the ruling have been met; the ruling has not been modified, revoked, revised, or cancelled; and the Customs Tariff legislation has not changed. Should there be a change in the material facts or circumstances pertaining to the origin of the goods, you must notify the CBSA as soon as possible. You may request that the AR be modified or revoked as of the date of the change.
Importers should quote the AR number at the time of importation in either the description field of the B3 entry document or on the Canada Customs Invoice. Exporters or producers should quote the advance ruling number on the Certificate of Origin or commercial invoice accompanying the goods.
Should you disagree with this AR, you may file a dispute notice under subsection 60(2) of the Customs Act within 90 days of the date of issuance. Please see the procedures outlined in the CBSA's Memorandum D11-4-16, Advance Rulings for Origin Under Free Trade Agreements.
This AR is considered reason to believe for the purposes of section 32.2 of the Customs Act and the CBSA's Administrative Monetary Penalty System, described in Memorandum D22-1-1.
All Memoranda referenced in this letter may be accessed on the CBSA website.
Consent to the Public Release of the Advance Ruling
As per your consent statement, we will release this advance ruling to the public, in both official languages, in accordance with the procedures described in Memorandum D11-11-3. The ruling will be published on the CBSA website in 30 days.
Manager, Tariff Policy Unit 'B'
Trade Policy Division
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