CLA-2-04:RR:NC:2:231 I89209
Mr. Graeme Honeyfield
Glinso Foods
3554 Round Barn Boulevard, Suite 310
Santa Rosa, CA 95403
RE: The tariff classification and country of origin marking under the North American Free Trade Agreement (NAFTA) of a powdered skim milk blend from Canada; Article 509
Dear Mr. Honeyfield:
In your letter, dated December 2, 2002, you requested a ruling on the tariff classification and country of origin marking of a powdered skim milk blend from Canada under the NAFTA.
The merchandise is a mixture of nonfat milk solids and lactose. The ingredients are 80 – 90 percent nonfat milk solids and 10 – 20 percent lactose (target, 15% lactose).
The dehydrated skim milk product is an agglomerated co-dried powder manufactured by drying nonfat milk solids with lactose. The milk solids are prepared by concentrating fresh skim milk. Lactose is then mixed with the concentrate, and the resultant mixture is spray-dried. The added lactose is said to act as a functional ingredient in the dried milk. It facilitates the even dispersion of the powder, without clumping, when water is added to the product. This dehydrated skim milk product has been formulated for use in hot and cold beverages, dry mixes, and vending machine applications.
For export to the United States, this product will be packed for the food service industry in 30 ounce cans in Canada or it will be shipped to industrial users in 25 kilogram bags or 500-1,000 kilogram bulk totes.
The concentrated skim milk will be made from milk produced in Canada. The lactose will be entirely produced in the United States or Canada from milk or whey derived from milk produced in the United States or Canada.
The applicable subheading for this dehydrated skim milk powder, if entered under quota, will be 0402.10.1000, Harmonized Tariff Schedule of the United States (HTS), which provides for milk and cream, concentrated or containing added sugar or other sweetening matter, in powder, granules or other solid forms, of a fat content, by weight, not exceeding 1.5 percent, described in additional U.S. note 7 to chapter 4 and entered pursuant to its provisions. The general rate of duty will be 3.3 cents per kilogram.
Additional U.S. note 7, in Chapter 4, provides that “[t]he aggregate quantity of dried milk,, whether or not containing added sugar or other sweetening matter, entered under subheheadings0404.10.10 and 0402.21.05 in any calendar year shall not exceed 5,261,000 kilograms (articles the product of Mexico shall not be permitted or included under the aforementioned quantitative limitation and son such articles shall be classifiable therein.).”
Imports of dried milk classifiable in subheading 0402.10.10, HTS, require import licenses, issued by the U.S. Department of Agriculture. Questions regarding licensing procedures and applications for licenses to import this product should be addressed to:
Import Quota Manager for Dairy Products
STOP 1029/Room 5531-S
U.S. Department of Agriculture
1400 Independence Ave., S.W.
Washington, DC 20250-1029
Goods classifiable in subheading 0402.10.1000, HTS, being wholly obtained or produced entirely in the territory of Canada and/or the United States, will meet the requirements of HTSUSA General Note 12(b)(i), and will therefore be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
The applicable subheading for the powdered skim milk blend, if entered outside the quota, will be 0402.10.5000, HTS, which provides for milk and cream, concentrated or containing added sugar or other sweetening matter, in powder, granules or other solid forms, of a fat content, by weight, not exceeding 1.5 percent, other. The general rate of duty will be 86.5 cents per kilogram. In addition, products classified in subheading 0402.10.5000, HTS, are subject to additional safeguard duties based on their value, as described in subheadings 9904.04.22 – 9904.04.30. However, U.S. Note 1, subchapter IV in chapter 99 states, “Goods of Canada or Mexico imported into the United States shall not be subject to any of the provisions, duties or limitations of this subchapter.” Accordingly, if a product of Canada, the safeguard duties will not apply.
In your letter you inquire as to the country of origin marking requirements under the NAFTA. For the purposes of the NAFTA, Canada is the country of origin, and the product should be marked accordingly.
Requests for information regarding other applicable regulations administered by the U.S. Department of Agriculture may be addressed to that agency at the following location:
A.P.H.I.S., Veterinary Services
Federal Building, Room 756
6505 Belcrest Road
Hyattsville, MD 20782
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR 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.
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 Thomas Brady at (646) 733-3030.
Sincerely,
Robert B. Swierupski
Director
National Commodity
Specialist Division