CLA-2 CO:R:C:F 955266 EAB
Matthew T. McGrath, Esquire
Barnes, Richardson & Colburn, Attorneys at Law
1225 Eye Street, N.W.
Washington, D.C. 20005
Re: "Hexabrix"; diagnostic imaging contrast medium; ioxaglic acid;
2924.29.4400; NAFTA; Article 509
Dear Mr. McGrath:
This is in reply to your letters dated October 19, 1993,
January 7, 1994 and June 24, 1994, on behalf of Mallinckrodt
Medical, Inc., in which you request a written ruling on the
classification under the Harmonized Tariff Schedule of the United
States Annotated (HTSUSA) of a diagnostic imaging contrast medium
patented under the name "Hexabrix", and preferential duty treatment
under the North American Free Trade Implementation Act (Pub. L.
103-182, 107 Stat. 2057) (December 8, 1993), hereinafter "NAFTA".
FACTS:
Ioxaglic acid, made in France, is used in Canada to
manufacture "Hexabrix". "Hexabrix" is a composite opacifying
preparation and diagnostic reagent, not containing antisera or
antigens, designed to be administered parenterally. In the
manufacturing process, ioxaglic acid, the preferred chemical name
of which is 3-[[[[3-(Acetylmethylamino)-2,4,6-triiodo-5-[(methyl-amino)carbonyl]benzoyl]amino]acetyl]-amino]-5-[[(2-hydroxyethyl)
amino]carbonyl]-2,4,6-triiodo-benzoic acid, undergoes a chemical
reaction in the presence of other compounds variously originating
in Germany and Sweden, none of which is classifiable under any
heading of chapter 30, HTSUSA, nor present in the final
formulation. Subsequent to formulation, the "Hexabrix" is bottled
at dosage level, sterilized, labelled and packaged in Canada for
consumption entry in the United States. The packaging materials
and containers for retail sale and the packing materials and
containers for shipment, delimited as glassware, stoppers, seals,
foam boxes, labels and bails, variously originate in Canada, the
U.S. and Germany.
ISSUE:
Whether "Hexabrix" formulated in Canada from non-originating
ioxaglic acid is a product of Canada for purposes of country of
origin marking and preferential duty treatment under NAFTA.
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the
HTSUSA. The tariff classification of merchandise under the HTSUSA,
is governed by the principles set forth in the General Rules of
Interpretation (GRIs) and, in the absence of special language or
context which otherwise requires, by the Additional U.S. Rules of
Interpretation. The GRIs and the Additional U.S. Rules of
Interpretation are part of the HTSUSA and are to be considered
statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first
according to the terms of the headings of the tariff schedule and
any relative section or chapter notes and, unless otherwise
required, according to the remaining GRIs taken in order.
Heading 2916 in part describes unsaturated acyclic
monocarboxylic acids and certain derivatives thereof.
Heading 2924 describes, among other substances, carboxyamide-function compounds.
Pursuant to legal note 3, Chapter 29, we are of the opinion
that ioxaglic acid is classifiable under heading 2924 and, more
particularly, classifiable under subheading 2924.29.4400, a
provision for carboxyamide-function compounds, cyclic amides,
other, aromatic, other, other, other, products described in
additional U.S. note 3 to section VI.
Heading 3006 describes pharmaceutical products specified in
note 3 to chapter 30. Legal Note 3 provides in part that heading
3006 "applies only to the following, which are to be classified in
that heading and in no other heading of the tariff schedule: . . .
(d) Opacifying preparations for X-ray examinations and diagnostic
reagents designed to be administered to the patient, . . .
consisting of two or more ingredients which have been mixed
together for such uses."
We find that "Hexabrix" is described by the terms of heading
3006 and legal note 3(d) to chapter 30. We are of the opinion that
"Hexabrix" is classifiable under subheading 3006.30.5000, HTSUSA,
a provision for certain pharmaceutical products used in X-ray
examinations and not containing antigens or antisera.
Goods originating in the territory of a NAFTA country are
subject to duty as provided in General note 12 to the HTSUSA; with
respect to such "Canadian" goods, see General note 12(a)(i),
HTSUSA.
"Hexabrix" qualifies for preferential duty treatment as goods
originating in Canada only if the goods sourced foreign to Canada
"have been transformed in the territory of Canada . . . so that .
. . except as provided in subdivision (f) [de minimis] of this
note, each of the non-originating materials used in the production
of such goods undergoes a change in tariff classification described
in subdivisions (r), (s) and (t) of this note or the rules set
forth therein . . . ." General note 12(b)(ii)(A), HTSUSA.
Pursuant to General notes 12(j) and (k), we disregard
packaging materials and containers for retail sale and packing
materials and containers for shipment in determining whether all
the non-originating materials used in the production of "Hexabrix"
undergo the applicable change in tariff classification set out in
subdivision (t) of General note 12.
Pursuant to General note 12(r)(i), the specific rules that
apply to heading 3006 set out in General note 12(t)/30 at 6. are:
(A) A change to subheadings 3006.10 through 3006.60 from any
other heading; or
(B) A change to subheadings 3006.10 through 3006.60 from any
other subheading within heading 3006, whether or not
there is also a change from any other heading, provided
there is a regional value content . . . .
We find that the non-originating ioxaglic acid used in the
production of "Hexabrix" undergoes a change in tariff
classification described General note 12(t)/30, subpart 6.(A). We
are of the opinion that "Hexabrix" made in Canada as set forth
hereinabove is a good of Canada and may be marked with the name of
Canada in English, French or Spanish and is entitled to
preferential duty treatment at the column 1 special rate of 2.7
percent ad valorem.
HOLDING:
"Hexabrix" is classifiable under subheading 3006.30.5000,
HTSUSA, a provision for pharmaceutical products specified in note
3 to chapter 30: opacifying preparations for X-ray examinations;
diagnostic reagents designed to be administered to the patient:
other.
"Hexabrix" manufactured in Canada from non-originating
ioxaglic acid and other compounds may be marked with the name of
Canada and is eligible for preferential duty treatment under NAFTA,
at the column 1 special rate of 2.7 percent ad valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division