CLA-2-17:RR:NC:FC:232 C82572
Mr. Patrick E. Mines
P. Mines Customs Services
28 Princess Street
P.O. Box 1197
Fort Erie, Ontario L2A 5Y2
Canada
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of drink crystal mixes from Canada; Article 509
Dear Mr. Mines:
In your letter December 5, 1997, on behalf of Western Basic Ingredients Limited, you requested a ruling on the status of various drink crystal mixes from Canada under the NAFTA. Information was submitted with your initial request dated October 14, 1997. Your request also asks for the country of origin for marking purposes of the product.
The subject merchandise is described as drink crystal mixes which will be imported in five flavors: Pink Lemonade Crystals, Apple Crystals, White Lemonade Crystals, Orange Crystals and Orange Mango Crystals. The products contain 93.5 percent to 95 percent sugar and various quantities of citric acid, ascorbic acid, natural and/or artificial flavor and colors. Some of the products also contain cornstarch, silicon dioxide, carboxymethyl cellulose, malic acid, quar gum and a clouding agent. The sugar is produced and refined in Mexico, the balance of the ingredients are from The United States. All of the ingredients are shipped to Canada where they are blended into the finished drink mixes. The product is shipped in bulk form to the United States for final retail packaging. The drink mixes are complete and require only the addition of water by the ultimate retail consumer.
The applicable tariff provision for the drink crystal mixes will be 1701.91.5800, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for cane or beet sugar and chemically pure sucrose, in solid form...containing added flavoring matter whether or not containing added coloring... articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17...other. The general rate of duty will be 36.9 cents per kilogram plus 5.6 percent ad valorem. Effective January 1, 1998, the general rate of duty will be 35.9 cents per kilogram plus 5.4 percent ad valorem.
The drink crystal mixes, being wholly obtained or produced entirely in the territory of Mexico, the United States, and Canada will meet the requirements of HTSUSA General Note 12(b)(i), and will therefore be entitled to a free rate of duty if entered under the terms of general note 12 of the Harmonized Tariff Schedule of the United States, and imported in quantities that fall within the quantitative limits described in U.S. note 20 to subchapter 6 of chapter 99 HTS pursuant to subheading 9906.17.39. If the quantitative limits of U.S. note 20 to subchapter 6 of chapter 99 have been reached, and if the product is valued not over 31.5 cents per kilogram, it will be dutiable at the rate of 22.7 cents per kilogram (19 cents per kilogram effective January 1, 1998)in subheading 9906.17.40, HTS. If valued over 31.5 cents per kilogram, the rate of duty will be 72.2 percent ad valorem, (60.2 percent ad valorem effective January 1, 1998), pursuant to subheading 9906.17.41, HTS, upon compliance with all applicable laws, regulations, and agreements.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 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.
Your inquiry also requests a ruling on the country of origin marking requirements for an imported article which is processed in a NAFTA country prior to being imported into the U.S. A marked sample was not submitted with your letter for review.
The marking statute, 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 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.
The country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the North American Free Trade Agreement ("NAFTA"), as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat 2057) (December 8, 1993) and the appropriate Customs Regulations. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. The marking requirements of these goods are set forth in Part 134, Customs Regulations.
Section 134.1(b) of the regulations, defines "country of origin" as
the country of manufacture, production, or growth of any article of foreign origin entering the U.S. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin within this part; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin. (Emphasis added).
Section 134.1(j) of the regulations, provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) of the regulations, defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules. Section 134.45(a)(2) of the regulations, provides that a "good of a NAFTA country" may be marked with the name of the country of origin in English, French or Spanish.
You state that the imported drink crystal mixes are processed in a NAFTA country "Canada" prior to being imported into the U.S. Since, "Canada" is defined under 19 CFR 134.1(g), as a NAFTA country, we must first apply the NAFTA Marking Rules in order to determine whether the imported drink crystal mixes are a good of a NAFTA country", and thus subject to the NAFTA marking requirements.
Part 102 of the regulations, sets forth the "NAFTA Marking Rules" for purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 of the regulations, sets forth the required hierarchy for determining country of origin for marking purposes.
Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that the imported drink crystal mixes are goods of "Mexico" for marking purposes, since they satisfy the requirements of Section 102.11(b)(1).
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR Part 181).
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 John Maria at 212-466-5730.
Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1301 Constitution Ave., NW, Franklin Court, Washington, DC 20229.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division