MAR-2 OT:RR:NC:2:238
Mr. George R. Tuttle III
Law Offices
George R. Tuttle
One Embarcadero Center, Suite 730
San Francisco, CA 94111-4044
RE: COUNTRY OF ORIGIN MARKING OF IMPORTED SABOURAUD DEXTROSE AGAR in TRIPLE WRAP PLATES; ARTICLE 509
Dear Mr. Tuttle:
This is in response to your letter dated May 19, 2008 requesting a ruling on behalf of your client, EMD Chemicals Inc. (“EMD”), regarding 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 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.
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.
You state that the merchandise, Sabouraud Dextrose Agar (EMD Catalog No, 4.86648.P100), will be imported into the United States from Canada in Triple Wrap 100mm plates, 100 plates per pack. Prior to importation into the U.S., the Sabouraud Agar plates are prepared in Canada from material sourced from Germany. The starting German product is a dehydrated granular culture medium consisting of peptone (pancreatic digest of casein and peptic digest combined in equal parts), dextrose, and agar as the solidifying agent (matrix). In Germany, the material components of the dehydrated media are mixed, dehydrated and pressed into granular form. Culture media in dehydrated granular form are a common option provided by manufacturers. Such granular media provide numerous advantages for the final user: less dust, better flow properties, better coating of the granulate with water, thus diminishing the time required for suspending and dissolving the media, and homogenous distribution of the contents leading to better shelf life.
Generally, Sabouraud Agars are prepared culture media formulated for the cultivation, isolation and identification of dermatophytes (fungal organisms that grow in or on the skin). The German material is essentially a completely formulated bulk culture medium which must then be further prepared as any dehydrated medium would be for final use. It is subjected to dissolution in heated water, autoclaving (sterilization), addition of preservatives and neutralizers, and pouring into plates or tubes. Basically, this process is a reconstitution of the dehydrated product which undergoes no major changes in fundamental character. All the ingredients required of a culture medium to nurture a microorganism culture remain present and available. Sabouraud dextrose media are general purpose peptone media supplemented with dextrose to support the growth of fungi. Peptones are sources of nitrogenous growth factors. Dextrose (the carbohydrate) provides an energy source for the growth of microorganisms. The basic medium may be further adapted for bacterial inhibition of specific unwanted organisms, neutralized for proper pH, etc., but it must be reconstituted before use in all cases.
The preceding processes are reflected in your description of the processing in Canada, wherein you state that the dehydrated German media will be reconstituted by adding ionized water, mixing, cooking and sterilizing. The dissolved product is poured into Petri dishes, sterilized/irradiated, and packaged for export to the U.S. In some cases Lecithin and Polysorbate 80 are added. It is our understanding that these additions are used to neutralize quaternary ammonium compounds and phenolic disinfectants (which may be present in the collected sample organisms). They affect no changes in the basic character of the medium.
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. We agree with your assessment that, under the given circumstances, the country of origin of the culture medium cannot be determined by application of Sections 102.11(a), (b) or (c).
Turning to Section 102.11(d) we are provided with the following hierarchy:
Where the country of origin of a good cannot be determined under paragraph (a), (b) or (c) of this section, the country of origin of the good shall be determined as follows:
(1) If the good was produced only as a result of minor processing, the country of origin of the good is the country or countries of origin of each material that merits equal consideration for determining the essential character of the good;
(2) If the good was produced by simple assembly and the assembled parts that merit equal consideration for determining the essential character of the good are from the same country, the country of origin of the good is the country of origin of those parts; or
(3) If the country of origin of the good cannot be determined under paragraph (d)(1) or (d)(2) of this section, the country of origin of the good is the last country in which the good underwent production.
Your client believes that the processes performed in Canada (e.g., denaturing of the protein, caramelization of the dextrose) to the basic dehydrated culture medium are not just diluting and repackaging. It is claimed that significant changes occur to the mixture during the mixing and cooking process in Canada. 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 product is a "good of a NAFTA country" and thus subject to the NAFTA marking requirements, we have examined the circumstances and claims of the instant situation against the NAFTA marking requirements.
Because of the claimed chemical and physical changes as a result of the Canadian processing, you suggest that the applicable requirements for the product are to be found in Section 102.11(d)(3). We disagree. Based on the description provided, we find that the material is subjected only to such “minor processing” of the type defined, in pertinent part, in Section 102.1(m):
(1) Mere dilution with water or another substance that does not materially alter the characteristics of the good;
(6) Putting up in measured doses, packing, repacking, packaging, repackaging;
(9) Repairs and alterations, washing, laundering, or sterilizing.
There is no material change in the dehydrated culture medium. It starts and ends as a medium for the cultivation, isolation and identification of dermatophytes (fungal organisms). It has to be reconstituted and packed into Petri plates to be serviceable, but that entails those minor processes outlined above: dissolving (even to 90%), autoclaving (cooking, sterilizing), repacking, and, perhaps, some additions to maintain a proper physical environment for the growth of fungi (e.g., by the addition of neutralizers). Some of the chemical and physical alterations brought about by dissolution/cooking do not change the identity and character of the product as a culture medium. Throughout the process the character and use of the medium as a source of growth factors and energy does not change. There is no change in the predetermined use. The final irradiation for the triple wrapped packages also has no effect on the product. Finally, the only material contributing to the essential character of the product is the culture medium itself, which is manufactured in Germany from German materials.
No argument is presented for the possible application of Sections 102.11(d)(2) or (3).
Since we find that the terms of Section 102.11(d)(1) are applicable to the facts in this case, it is our opinion that the Sabouraud Dextrose Agar Plates are goods of Germany for marking purposes.
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 Harvey Kuperstein at 646-733-3033.
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, Bureau of Customs and Border Protection, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division