MKG-2-84: OT:RR:NC:N3:139
Donald Stein
Greenberg Traurig, LLP
2101 L St. N.W., Suite 1000
Washington, D.C. 20037
RE: The NAFTA Country of Origin Marking of Correction Tape in Plastic Dispensers
Dear Mr. Stein:
In your letter dated March 14, 2019, you requested a NAFTA country of origin marking ruling on behalf of your client, BIC USA, Inc.
The items under consideration have been identified as correction tape in plastic dispensers: jumbo rolls of polyethylene (PET) plastic film, coated with white pigment composed of titanium dioxide, magnesite, and silicon dioxide. The bulk tape with pigment is made in Japan and then imported into Mexico where it is cut to size, rolled into a tape dispenser ribbon spool, and then assembled into correction tape dispensers (with other plastic components of Mexican origin). The pigment preparation is applied to paper to correct typographical and handwritten errors by positioning the tip of the roller of the dispenser, pressing firmly and rolling over the surface to be covered. The finished product, correction tape in plastic dispensers, is then exported from Mexico to the United States.
On July 24, 2018, CBP issued ruling H292437 on both the classification and NAFTA eligibility for this product, correction tape in plastic dispensers for BIC USA, Inc. This product was classified in subheading 3824.99.92, which provides for “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Other: Other: Other.” The 2019 column one, general rate of duty is 5% ad valorem.
In this case, the correction tape dispensers are produced in Mexico. As such, part 102, Customs Regulations (19 CFR 102.11), is applicable, which 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. Applied in sequential order, the required hierarchy establishes that the country of origin of a good is the country in which: (a)(1) The good is wholly obtained or produced; (a)(2) The good is produced exclusively from domestic materials; or (a)(3) Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in Section 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied. Sections 102.11(a)(1) and 102.11(a)(2) do not apply to the facts presented in this case because the imported correction tape in plastic dispensers is neither wholly obtained nor produced exclusively from “domestic” (Mexican, in this case) materials. Because the analysis of sections 102.11(a) (1) and 102.11(a) (2) does not yield a country of origin determination, we look to section 102.11(a) (3). “Foreign material” is defined in 19 C.F.R. § 102.1(e) as “a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced.”
As indicated above, the correction tape dispensers are classified in subheading 3824.99, HTSUS. However, as the NAFTA Marking Rules have not been updated to add a rule for subheading 3824.99 to reflect changes made in the Harmonized System effective for such commodities in 2012, the NAFTA Marking Rule of the prior classification of the correction tape dispensers must be used. Prior to 2012, correction tape put up for retail sale was classified in heading 3206, HTSUS, specifically subheading 3206.49.10, HTSUS.
The applicable NAFTA Marking Rule for subheadings 3206.20 through 3209.90, HTSUS, in section 102.20 requires,
A change to pigments and preparations based on cadmium compounds of subheading 3206.49 from any other good of subheading 3206.49 or from any other subheading; or
A change to pigments and preparations based on hexacyanoferrates (ferrocyanides and ferricyanides) from any other good of subheading 3206.49 or from any other subheading; or
A change to any other good of subheading 3206.49 from pigments and preparations based on cadmium compounds or hexacyanoferrates (ferrocyanides and ferricyanides) of subheading 3206.49 or from any other subheading; or
A change to any other good of subheading 3206.20 through 3209.90 from any other subheading, including another subheading within that group.
Following importation into Mexico, the correction tape is cut to size and rolled into a ribbon spool, and this material is also classified in subheading 3206.49. Therefore, the tariff shift rule is not met and the product should be marked, “Country of Japan.”
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
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, please contact National Import Specialist Patrick Day at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division