USMCA’s Rule Comes into Effect on Pocket Bag Fabric for Blue Denim Apparel
Trade Update • Nov. 23, 2022
ffective January 1, 2023, the second phase of the pocket bag fabric rule for blue denim apparel under the United States-Mexico-Canada Free Trade Agreement (USMCA) will be implemented.
Applicable Goods
This provision applies to woven apparel goods of HTS Chapter 62 that are made of blue denim fabric of HTS subheadings 5209.42, 5211.42, 5212.24 and/or 5514.30, which contain a pocket or pockets.
If applicable, the pocket bag fabric must be formed and finished in the territory of one or more of the USMCA countries. Pocket bag fabric is considered formed and finished in one or more USMCA countries, if the pocket bag fabric has been formed from yarn that was wholly formed and finished in the territory of one or more of the USMCA countries. This provision is found in General Note 11(o), Chapter 62, Rule 5 of the HTS.
The first phase of the pocket bag fabric Chapter Rule was effective January 1, 2022, eighteen (18) months from the date of entry into force of the USMCA. This rule applies to apparel goods of Chapters 61 and 62 of the HTS that contain a pocket or pockets, the pocket bag fabric must be formed and finished in the territory of one or more of the USMCA countries from yarn wholly formed in one or more of the USMCA countries. This provision is found in General Note 11(o), Chapter 61, Rule 4 and Chapter 62, Rule 6.
Verification
All apparel shipments claiming USMCA preference are subject to verification. Claims that are unable to be substantiated may be denied preferential tariff treatment and false claims may result in the issuance of penalties.
Questions about this upcoming USCMA rule on apparel, please contact us, we’re here to help.
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