CLA-2-20:RR:NC:2:231 H84143
Mr. Rodney Ralston
Trans-Border Customs Services, Inc.
One Trans-Border Drive
P.O. Box 800
Champlain, NY 12919
RE: The tariff classification and country of origin marking under the North American Free Trade Agreement (NAFTA) of macadamia nut kernels of Australian origin that are roasted and salted in Canada and exported to the US; Article 509
Dear Mr. Ralston:
In your letter, dated July 20, 2001, on behalf of your client, Papco Foods, Inc., St-Laurent, Québec, you requested a ruling on the tariff classification and country of origin marking of macadamia nut kernels of Australian origin that are roasted and salted in Canada and exported to the United States under the NAFTA.
The merchandise is comprised of raw macadamia nut kernels of Australian origin that are exported from Australia to Canada for roasting and salting. The nuts will then be shipped to the United States in bags of 1 or 2 pounds or in bulk bags of 5 or 10 pounds.
In your letter you ask whether the process of roasting and salting qualify the nuts as “nuts of Canadian origin” for country of origin marking purposes, and whether they are subject to NAFTA preference for duty purposes.
The applicable subheading for macadamia nuts will be 2008.19.9010, Harmonized Tariff Schedule of the United States (HTS), which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together, other, including mixtures, other, including mixtures, other, macadamia nuts. The general rate of duty will be 17.9 percent ad valorem.
Each of the non-originating materials has satisfied the changes in tariff classification required under HTSUSA General Note 12(t)/20.4. This product will be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
The marking rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. Part 102 of the Customs Regulations sets forth the “Rules of Origin” for the purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 articulates the required hierarchy for determining country of origin for marking purposes.
Section 102.11(a)(3) states that the country of origin of a good is the country in which “each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in Section 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied." Section 102.20(d) articulates the tariff shifts that are required for merchandise that is classifiable in chapter 20, HTS.
Applying the NAFTA Marking Rules set forth in Part 102 of the Customs Regulations to the facts of this case, we find that for marking purposes, these goods are of Canadian origin. A tariff shift has occurred, as per CR 102.20(d).
Accordingly, raw macadamia nut kernels of Australian origin that are roasted and salted in Canada and exported to the United States, are products of Canada for the purposes of country of origin marking.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR 181).
This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Thomas Brady at (212) 637-7064.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division