CLA-2-44:OT:RR:NC:2:230
Ms. Linda Rasco
Metro Customs Brokers
1 Lincoln Blvd., Suite 202
Rouses Point, NY 12979
RE: The tariff classification, country of origin, and status under the North American Free Trade Agreement (NAFTA) of multilayer wood flooring panels
Dear Ms. Rasco:
In your letter dated February 29, 2016, you requested a ruling on behalf of your client, Les Planchers Mercier, Inc. We apologize for the delay in processing your request.
The ruling request regards two styles of multilayer wood flooring panels, ME-OPPA53-00F and ME-OPPA13-00F, and seeks the tariff classification, country of origin, and status under the NAFTA for the two styles. Photos and product information were submitted for our review.
The first panel, style number ME-OPPA53-00F, is a multilayer wood flooring panel measuring 8.5mm in thickness, and having a face ply measuring 2.5mm in thickness. The panels measure 3¼” wide by 12” to 84” long at time of importation. You indicate that this style has a face ply of maple, oak, walnut, white oak, or hickory wood. The panel is constructed of six plies of wood laminated together with the grains of each ply running at an angle to that of the subsequent ply.
The second panel, style number ME-OPPA13-00F, is a multilayer wood flooring panel measuring 12.8mm in thickness, and having a face ply measuring 4mm in thickness. The panels measure 3¼” wide by 12” to 84” long at time of importation. You indicate that this style has a face ply of maple, oak, walnut, white oak, or hickory wood. The panel is constructed of eight plies of wood laminated together with the grains of each ply running at an angle to that of the subsequent ply.
Both are flooring panels assembled from multiple laminated plies. The Explanatory Notes to the Harmonized System for heading 4412, Harmonized Tariff Schedule of the United States (HTSUS), define plywood as consisting of three or more sheets of wood glued and pressed on the other and generally disposed so that the grains of successive layers are at an angle. Both of the panel constructions are described by this definition. However, Additional US Note 4(b) states that Heading 4418 includes multi-layer assembled flooring panels having a face ply 4mm or more in thickness. Under these rules, style ME-OPPA53-00F is classifiable under heading 4412, HTSUS, while style ME-OPPA13-00F is classifiable under heading 4418.
The applicable subheading for style ME-OPPA53-00F with a face ply of walnut will be 4412.32.2525, HTSUS, which provides for Plywood, veneered panels and similar laminated wood: Other plywood consisting solely of sheets of wood (other than bamboo), each ply not exceeding 6 mm in thickness: Other, with at least one outer ply of nonconiferous wood: Not surface covered, or surface covered with a clear or transparent material which does not obscure the grain, texture or markings of the face ply: With a face ply of Spanish cedar (Cedrela spp.) or walnut (Juglans spp.) With a face ply of walnut (Juglans spp.): Wood flooring. The rate of duty will be 5.1 percent ad valorem.
The applicable subheading for style ME-OPPA53-00F with a face ply of maple, oak, white oak, or hickory will be 4412.32.3125, HTSUS, which provides for Plywood, veneered panels and similar laminated wood: Other plywood consisting solely of sheets of wood (other than bamboo), each ply not exceeding 6 mm in thickness: Other, with at least one outer ply of nonconiferous wood: Not surface covered, or surface covered with a clear or transparent material which does not obscure the grain, texture or markings of the face ply: Other, with at least one outer ply of nonconiferous wood: Not surface covered, or surface covered with a clear or transparent material which does not obscure the grain, texture or markings of the face ply: Wood flooring. The rate of duty will be 8 percent ad valorem.
The applicable subheading for style ME-OPPA13-00F will be 4418.72.9500, HTSUS, which provides for Builders' joinery and carpentry of wood, including cellular wood panels and assembled flooring panels; shingles and shakes: Assembled flooring panels: Other, multilayer: Other: Other. The rate of duty will be 5 percent ad valorem.
Les Planchers Mercier indicates in their submission that they source birch plywood from Russia that will serve as the substrate for the flooring panels. Logs sourced in the United States and Canada are processed into veneers in Canada. In Canada, the Russian plywood is cut into strips; the veneers are laminated onto the plywood substrate; the strips are tongued and grooved; the panels are stained, coated with a UV-cured, aluminum oxide material, and finished; and the complete panels are packaged.
General Note 12, HTSUS, incorporates Article 401 of the NAFTA into the HTSUS. General Note 12(a)(i) provides, in pertinent part:
(a) Goods originating in the territory of a party to the North American Free Trade Agreement (NAFTA) are subject to duty as provided herein. For the purposes of this note--
(i) Goods that originate in the territory of a NAFTA party under the terms of subdivision (b) of this note and that qualify to be marked as goods of Canada under the terms of the marking rules set forth in regulations issued by the Secretary of the Treasury (without regard to whether the goods are marked), and goods enumerated in subdivision (u) of this note, when such goods are imported into the customs territory of the United States and are entered under a subheading for which a rate of duty appears in the "Special" subcolumn followed by the symbol "CA" in parentheses, are eligible for such duty rate, in accordance with section 201 of the North American Free Trade Agreement Implementation Act.
General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that
For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as “goods originating in the territory of a NAFTA party” only if—
(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--
(A) except as provided in subdivision (f) 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, or
(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification
is required, and the goods satisfy all other requirements of this note;
Subdivision (t) states that, in order to be subject to NAFTA, manufacturing must result in a change as follows: A change to headings 4401 through 4421 from any other heading, including another heading within that group. For style ME-OPPA53-00F, because the plywood product originating in Russia is classifiable in heading 4412, HTSUS, and the final flooring panel is also classifiable in heading 4412, HTSUS, the above rule is not met and the panels do not qualify for NAFTA preferential treatment. However, for style ME-OPPA13-00F, because the Russian plywood is classifiable in heading 4412, HTSUS, and the final flooring panel is classifiable in heading 4418, HTSUS, the rule is met; provided the panel qualifies to be marked as a product of Canada, this style does meet the rule for NAFTA preferential treatment. (Please see below.)
With regard to country of origin and marking of the flooring panels, Section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. shall be marked in a conspicuous place as legibly, indelibly and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the U.S. the English name of the country of origin of the article.
Part 134, Customs Regulations (19 CFR Part 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Pursuant to 19 CFR Section 134.1(b), the country of origin is the country of manufacture, production or growth of any article of foreign origin entering the U.S. Further work or material added to a foreign article in the United States must effect a substantial transformation in order to render the final product a good of the U.S. However, for a good of a NAFTA country, the NAFTA Rules of Origin (set forth in 19 CFR Part 102) will determine the country of origin and marking. Because the flooring panels are partly manufactured in a NAFTA country (Canada), the NAFTA rules govern the current scenario.
Section 102.20 provides that, for goods of heading 4412, HTSUS, the manufacturing must result in a change to surface-covered plywood of heading 4412 from any other plywood that is not surface covered or is surface-covered only with a clear or transparent material which does not obscure the grain, texture, or markings of the face ply. Style ME-OPPA53-00F, which is surface-covered in Canada, amongst many other operations, meets this rule. The country of origin of style ME-OPPA53-00F is Canada.
For goods of heading 4418, HTSUS, the manufacturing must result in a change to plywood of subheading 4418.71 through 4418.79 from any other good of heading 4418 or from any other heading, except from heading 4412. As described above, style ME-OPPA13-00 is a flooring panel of plywood construction. The Russian plywood substrate is classifiable in heading 4412, and the manufacturing in Canada results in a panel classifiable in heading 4418. Since this heading shift is precluded by the above rule, the country of origin of this product remains Russia. Because the country of origin of style ME-OPPA13-00 is Russia, the panels do not qualify for NAFTA preferential treatment.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at https://hts.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
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 Laurel Duvall at [email protected].
Sincerely,
Deborah C. Marinucci
Acting Director
National Commodity Specialist Division