CLA-2 RR:TC:MM 958912 JAS
Port Director of Customs
P.O. Box 3130
Laredo, TX 78044
RE: PRD 2304-95-100219; Dump Truck of Canadian Origin Imported
into the customs territory from Mexico; Canadian Article,
Originating Good; Automotive Products Trade Act (APTA);
General Notes 5 and 12, HTSUS; Transshipment; NAFTA Rules of
Origin Regulations; Section 16 of the Appendix to Part 181
of Title 19 CFR; HQ 958053
Dear Port Director:
This is our decision on protest 2304-95-100219, filed by a
representative of Trax, Inc., against your denial of free entry
under the Automotive Products Trade Act of 1965, as amended, for
dumper cab chassis. The entries were liquidated on November 11,
1995, and this protest timely filed on December 4, 1995.
FACTS:
The merchandise is invoiced as two Euclid R-35 Rock Truck
Chassis, serial numbers 324TDC74674 and 7, and described on the
Customs Form 7501 as off-highway dumper cab chassis. They were
manufactured in Canada, then exported to Mexico where they were
released from Customs control, used for an indeterminate period
of time, then entered into the customs territory of the United
States under the Automotive Products Trade Act of 1965, as
amended (APTA). The proper APTA certification and documentation
of Canadian origin are not in issue.
Both the importer/protestant and your office agree that
subheading 8704.10.10, Harmonized Tariff Schedule of the United
States (HTSUS), a provision for dumpers designed for off-highway
use, cab chassis, represents the correct classification.
Notwithstanding the issuance of a ruling on this issue to the
importer/protestant, HQ 958053, dated September 20, 1995, your
office believes that these vehicles are not eligible for the - 2 -
duty-free benefits conferred by the APTA because they were not
imported directly into the customs territory of the United States
from Canada.
ISSUE:
Whether articles otherwise qualifying as originating goods
lose that status by virtue of their use in Mexico.
LAW AND ANALYSIS:
General Note 5(a), HTSUS, Automotive Products and Motor
Vehicles Eligible for Special Tariff Treatment, provides that
motor vehicles and original motor-vehicle equipment which are
Canadian articles and which fall in provisions for which the rate
of duty "Free (B)" appears in the "Special" subcolumn may be
entered free of duty under the Automotive Products Trade Act. In
accordance with Note 5(a)(I) the term "Canadian article" means an
article which originates in Canada, as defined in General Note
12.
Paragraph (b) of General Note 12, HTSUS, North American Free
Trade Agreement, establishes the criteria under which goods
imported into the customs territory of the United States qualify
as originating goods for NAFTA purposes. There is no dispute
that the dumper in issue qualifies as an originating good under
General Note 12.
General Note 12(l), HTSUS, Transshipment, states that a good
shall not be considered to be an originating good by reason of
having undergone production that satisfies the requirements of
this note if, subsequent to that production, the good undergoes
further production or any other operation outside the territories
of the NAFTA parties, other than unloading, reloading or any
other operation necessary to preserve it in good condition or to
transport the good to the territory of Canada, Mexico and/or the
United States. Rule 12(l) is interpreted by the NAFTA Rules of
Origin Regulations which appear in the Appendix to Part 181 of
Title 19, Code of Federal Regulations (19 CFR 181). Paragraph
(1)(a) of PART VI, SECTION 16. TRANSSHIPMENT, states in relevant
part that a good otherwise qualifying as an originating good
loses that status if the good is withdrawn from customs control
outside the territories of the NAFTA countries.
- 3 -
HOLDING:
The dumpers under protest, serial numbers 324TDC74674 and 7,
qualify as originating goods under General Note 12, HTSUS. Upon
importation into the customs territory of the United States from
Mexico, they are within the term "Canadian article" for purposes
of General Note 5, HTSUS. They are eligible for entry free of
duty under the APTA if all applicable requirements are satisfied.
The protest should be ALLOWED. In accordance with Section
3A(11)(b) of Customs Directive 099 3550-065, dated August 4,
1993, Subject: Revised Protest Directive, you should mail this
decision, together with the Customs Form 19, to the protestant no
later than 60 days from the date of this letter. Any
reliquidation of the entry or entries in accordance with the
decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision the Office of
Regulations and Rulings will take steps to make the decision
available to Customs personnel via the Customs Rulings Module in
ACS and to the public via the Diskette Subscription Service, the
Freedom of Information Act and other public access channels.
Sincerely,
John Durant, Director
Tariff Classification
Appeals Division