CLA-2-59:OT:RR:NC:TA:350
Ms. Kimberly Whitworth
Maddocks Industrial Filter Division
663 Woodward Avenue
Hamilton, ON Canada L8H 6P3
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of two air filters for use in helicopters, from Canada; Article 509.
Dear Ms. Whitworth:
In your letter dated October 29, 2013, you requested a ruling on the status of two air intake helicopter filters which were identified as part #’s AR-771-22 & AR-771-44 from Canada, under the NAFTA. You also inquired about the marking and country of origin. All of these issues will be addressed below.
You write that these filters are constructed from 100 percent polyester spunbonded nonwoven filter media that is sourced from Korea. Additionally, the aluminum caps (2) and screens (2) are of Canadian origin. Finally, the adhesive used to hold the caps is of U.S. origin. These six components are processed in Canada to form the completed air filters.
In your ruling request letter you suggest that classification of this product is proper in tariff subheading 8803.30.00, Harmonized Tariff Schedule of the United States (HTSUS), which provides for … other parts of helicopters. However, after a review of the various Section and Chapter notes this office finds that position is not correct. In Section XVII, Note 2(e) excludes filters of Chapter 84 from classification therein. Additionally, Section XVI, Note 1(e), which governs the classification of all products in that section, which includes Chapter 84, reads, "this section does not cover “transmission or conveyor belts of textile material ... or other articles of textile material for technical uses (heading 5911)." Filters of textile material are considered technical use textiles of heading 5911, HTSUS.
Following the tenets of these tariff exclusions, the applicable tariff provision for the filters will be 5911.90.0080, HTSUS, which provides for textile products and articles, for technical use. The general rate of duty will be 3.8 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/.
Your inquiry concerning the applicability of NAFTA will be addressed as follows:
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.
Specifically, General Note 12(B)(ii)(A) with regard to the tariff shift requirements reads as follows:
HTSUS 5911
“A change to heading 5911 from any other chapter, except from headings 5111 through 5113, 5209 through 5212, 5310 through 5311, 5407 through 5408 or 5512 through 5515”.
As the only non-originating component, i.e., the nonwoven filter media of Korean origin is classifiable in heading 5603 and not in any of the headings listed above, the nonwoven filter media meets the tariff shift requirement outlined above according to General Note 12(b)(ii)(A) above. As such, the goods will therefore be entitled to a Free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
Additionally, you inquired about the country of origin and marking for the above captioned product. To that end, please be aware of the following textile rules of origin that apply in this case.
COUNTRY OF ORIGIN - LAW AND ANALYSIS:
Section 334 of the Uruguay Round Agreements Act (codified at 19 U.S.C. 3592), enacted on December 8, 1994, provided rules of origin for textiles and apparel entered, or withdrawn from warehouse for consumption, on and after July 1, 1996. Section 102.21, Customs Regulations (19 C.F.R. 102.21), published September 5, 1995 in the Federal Register, implements Section 334 (60 FR 46188). Section 334 of the URAA was amended by section 405 of the Trade and Development Act of 2000, enacted on May 18, 2000, and accordingly, section 102.21 was amended (68 Fed. Reg. 8711). Thus, the country of origin of a textile or apparel product shall be determined by the sequential application of the general rules set forth in paragraphs (c)(1) through (5) of Section 102.21.
Paragraph (c)(1) states, “The country of origin of a textile or apparel product is the single country, territory, or insular possession in which the good was wholly obtained or produced.” As the subject merchandise is not wholly obtained or produced in a single country, territory or insular possession, paragraph (c)(1) of Section 102.21 is inapplicable.
Paragraph (c)(2) states, “Where the country of origin of a textile or apparel product cannot be determined under paragraph (c)(1) of this section, the country of origin of the good is the single country, territory, or insular possession in which each of the foreign materials incorporated in that good underwent an applicable change in tariff classification, and/or met any other requirement, specified for the good in paragraph (e) of this section:” Paragraph (e) in pertinent part states,
The following rules shall apply for purposes of determining the country of origin of a textile or apparel product under paragraph (c)(2) of this section:
HTSUS 5911.90 Tariff shift and/or other requirements
This rule states in pertinent part that “if the good is a made up article other than a good of yarn, rope, cord or braid, a change to subheading 5911.90 from any heading including a change from another good of heading 5911, provided that the change is the result of the good being wholly assembled in a single territory or insular possession”.
In that regard, please note that the nonwoven filter media is classifiable in heading 5603, the aluminum metal caps (2) and screens (2) in heading 7616 and the adhesive in 3506. As such, and noting that the finished product was wholly assembled in the territory of Canada from these six components which are all outside heading 5911, the goods have met the tariff shift requirement described above.
Once again, as the subject filters are wholly assembled in the territory of Canada from goods classifiable in other headings, the requirements of Section 102.21(c)(2) have been met.
HOLDING:
The country of origin of the air filter is Canada. The marking “Made in Canada”, as you suggest, would be acceptable.
The holding set forth above applies only to the specific factual situation and merchandise identified in the ruling request. This position is clearly set forth in section 19 CFR 177.9(b)(1). This section states that a ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). Should it be subsequently determined that the information furnished is not complete and does not comply with 19 CFR 177.9(b)(1), the ruling will be subject to modification or revocation. In the event there is a change in the facts previously furnished, this may affect the determination of country of origin. Accordingly, if there is any change in the facts submitted to Customs, it is recommended that a new ruling request be submitted in accordance with 19 CFR 177.2.
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.
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 Deborah Walsh at (646) 733-3044.
Sincerely,
Gwenn Klein Kirschner
Acting Director
National Commodity Specialist Division