CLA-2-82:OT:RR:NC:1:104
Mr. Craig E. Watson
Magapro Marketing Inc.
360 Edworthy Way, Unit 106
New Westminster,
British Columbia V3L 5T8
Canada
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a multi-bit ratcheting screwdriver from Canada; Article 509
Dear Mr. Watson:
In your undated letter received by this office on February 14, 2011, you requested a ruling on the status of a multi-bit ratcheting screwdriver from Canada under the NAFTA. You provided samples of both the finished Megapro Multi-bit Ratcheting Screwdriver Item #211R2C36RD and the components that are utilized during the production of the article. The components are used in the various stages of production up to the finished article. The samples are being returned to you.
The Megapro Multi-bit Ratcheting Screwdriver Item #211R2C36RD features a “pull-out” bit storage area within the ratcheting handle. It holds six double ended screwdriver bits, i.e., Phillips 0-3, Phillips 1-2, Flat (slotted) 4-6, Torx 10-15, Torx 20-25 and Square (Robertson) 1-2. Item #211R2C36RD is produced in Canada from originating materials from Canada and non-originating material from Taiwan. The metal ratchet device and screwdriver bits are manufactured in Taiwan. The balance of the components that comprise Item #211R2C36RD are originating materials from Canada. The Taiwanese components are exported to Canada where they are assembled together with the plastic Canadian components to produce Item #211R2C36RD. Printing and warehousing also occur in Canada.
You indicate that the finished Item #211R2C36RD is then exported to the United States. At time of importation into the United States the item is packaged ready for retail sale.
The applicable tariff provision for the finished Megapro Multi-bit Ratcheting Screwdriver Item #211R2C36RD will be 8207.90.6000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Interchangeable tools for hand tools, whether or not power operated, or for machine-tools (for example, for pressing, stamping, punching, tapping, threading, drilling, boring, broaching, milling, turning or screwdriving), including dies for drawing or extruding metal, and rock drilling or earth boring tools; base metal parts thereof: Other interchangeable tools, and parts thereof: Other: Other: Not suitable for cutting metal, and parts thereof: For handtools, and parts thereof. The general rate of duty will be 4.3 percent ad valorem.
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 http://www.usitc.gov/tata/hts/.
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--
(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or
(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; or
(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or
(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for “parts” and used in the production of such goods does not undergo a change in tariff classification because--
(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or
(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.
The Megapro Multi-bit Ratcheting Screwdriver Item #211R2C36RD does not qualify for preferential treatment under the NAFTA because none of the above requirements are met. Based on the facts provided, the screwdriver bits do not undergo the requisite tariff shift required by HTSUS General Note 12(t), Chapter 82(7), “A change to subheadings 8207.19 through 8207.90 from any other chapter”.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 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 Patricia O’Donnell at (646) 733-3011.
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 and Border Protection, Regulations & Rulings, 799 9th Street N.W. - 7th floor, Washington, DC 20229-1177.
Sincerely,
Robert B. Swierupski
Director
National Commodity Specialist Division