CLA-2-76:OT:RR:NC:N1:116
Mr. David J. Craven
Craven Trade Law, LLC.
3744 N Ashland Avenue
Chicago, IL 60613
RE: The classification and country of origin of heat-sealable lidding stock
Dear Mr. Craven:
In your letter dated December 17, 2020, on behalf of your client, Winpak Heat Seal Corporation of Pekin, Illinois, you requested a tariff classification and country of origin determination for ordinary Customs duties. Representative samples were included with an earlier submission and will be retained by this office.
The product under consideration is heat-sealable lidding stock that is made using an aluminum foil base upon which other materials are added. You have described the product as a three-layered lidding stock. The inner side of the aluminum, the surface that will be in contact with food, is coated with a polymeric layer that provides sealability to a rigid container. The outer layer is coated with a thinner polymeric layer that protects the foil from corrosion and provides adherence for printed inks.
According to your submission, the foil base is imported into Canada in various thicknesses of less than 0.2 mm. You have stated that the foil will be sourced from various countries, but for the purposes of this ruling, you have requested that we consider foil that originates specifically in Luxembourg. The remaining materials are imported into Canada from Norway, Mexico, and the United States (U.S.) and are used to produce both the outer layer and the inner layer of the final product. In Canada, the bare foil is unwound and, in a continuous process line, the foil goes through a coating station where a liquid coating is applied to the outer side of the foil. The semi-finished heat-sealable lidding stock is then subjected to a hot air drying system which removes any residual solvent or water and dries the coating. You state the inner layer is made from a solid material which is melted and then applied to the middle (foil) layer in a molten form. The resultant product is then imported into the U.S. where it is shipped to the lid producer for production of heat-sealable lids from this heat-sealable lidding stock.
Based on the information provided, the heat-sealable lidding stock is properly classified in subheading 7607.11.6090, Harmonized Tariff Schedule of the United States (HTSUS), which provides for aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness (excluding any backing) not exceeding 0.2 mm: not backed: rolled but not further worked: of a thickness not exceeding 0.15 mm: of a thickness exceeding 0.01 mm: other. The rate of duty will be 5.3 percent ad valorem.
In addition to classification, you are requesting a country of origin determination for ordinary Customs duties for the lidding stock. There is no test to determine country of origin for ordinary Customs duties because ordinary Customs duty does not depend on the country of origin but rather on the tariff classification. You have specifically stated that you are not requesting a country of origin for eligibility under the U.S.-Mexico-Canada Agreement (“USMCA”), nor are you requesting a country of origin determination for purposes of applicability of trade remedies. To allow for a more seamless transition period, at this time CBP continues to utilize the marking rules in 19 C.F.R. Part 102, with the exception of 19 C.F.R. § 102.19, for purposes of country of origin with respect to goods of those countries that are party to the “USMCA”. See 19 C.F.R. § 102.11. Applied in sequential order, the required hierarchy establishes that the country of origin of a good is the country in which:
(a)(1) The good is wholly obtained or produced;
(a)(2) The good is produced exclusively from domestic materials; or
(a)(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in § 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied.
Sections 102.11(a)(1) and 102.11(a)(2) do not apply to the facts presented in this case because the aluminum foil is neither wholly obtained or produced nor is it produced exclusively from “domestic” materials. Because the analysis of sections 102.11(a)(1) and 102.11(a)(2) does not yield a country of origin determination, we look to section 102.11(a)(3). Pursuant to 19 C.F.R. §102.11(a)(3), 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 as set forth in 19 C.F.R. §102.20, and satisfies any other applicable requirements of that section. In this case, because the aluminum foil imported into Canada is classified under heading 7607, HTSUS, the change in tariff classification must be made in accordance with section 102.20(n), Section XV: Chapters 72 through 83, heading 7607, HTSUS, which requires “A change to heading 7607 from any other heading.” The aluminum foil that is shipped to Canada for processing (i.e., unwound, coated, etc.) is classified in heading 7607, HTSUS. Upon importation into the U.S., the lidding stock remains classified under heading 7607, HTSUS. As such, the tariff shift requirement of section 102.11(a)(3) is not met. Since an analysis of section 102.11(a) has not produced a country of origin determination, we turn to section 102.11(b) of the regulations. Section 102.11(b)(1) provides as follows:
(b) Except for a good that is specifically described in the Harmonized System as a set, or is classified as a set pursuant to General Rule of Interpretation 3, where the country of origin cannot be determined under paragraph (a) of this section:
(1) The country of origin of the good is the country or countries of origin of the single material that imparts the essential character to the good, or . . .
The rule of interpretation set forth in 19 C.F.R. § 102.18(b)(1)(iii) states that if there is only one material that is classified in a tariff provision from which a change in tariff classification is not allowed under the 19 C.F.R. § 102.20 specific rule or other requirements applicable to the good, then that material will represent the single material that imparts the essential character to the good under 19 C.F.R. § 102.11. In this case, the material that does not undergo the applicable tariff shift is the aluminum foil. Therefore, the aluminum foil is the material that imparts the essential character. As the country of origin of the single material that imparts the essential character is Luxembourg, the country of origin of the heat-sealable lidding stock is Luxembourg.
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 Angelia Amerson at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division