CLA-2-20:OT:RR:NC:N2:228
Mr. Thomas J. O’Donnell
Benjamin L. England and Associates
810 Landmark Drive, Suite 126
Glen Burnie, Maryland 21061
RE: The classification and country of origin of green olives from Morocco, Greece and Egypt
Dear Mr. O’Donnell:
In your letter dated November 4, 2019, you requested a tariff classification and country of origin ruling on behalf of your client, Mario Camacho Foods, FL.
An ingredients breakdown and a narrative description of the manufacturing process were provided with your inquiry. The green olives are grown in Morocco, Greece, or Egypt where they are harvested and cleaned, cured in brine solution, packed in brine-filled drums and shipped to Spain where they are pitted and some are stuffed with a pimento paste. After repackaging the pitted stuffed and unstuffed green olives are shipped to their final destination, the United States.
The applicable subheading for the pitted stuffed green olives will be 2005.70.1600, Harmonized Tariff Schedule of the United States (HTSUS), which provides for other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen…olives…in saline solution…green in color…pitted or stuffed…place packed…stuffed, in containers each holding not more than 1 kg, drained weight…in an aggregate quantity not to exceed 2700 metric tons in any calendar year. The rate of duty will be 5.4 cents per kilogram on drained weight. When the total quantity imported into the United States in any calendar year exceeds 2700 metric tons, the applicable subheading will be 2005.70.1800, HTSUS, and the rate of duty will be 6.9 cents per kilogram on drained weight.
The applicable subheading for the unstuffed pitted green olives will be 2005.70.2300, HTSUS, which provides for other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen…olives…in saline solution…green in color…pitted or stuffed…place packed. The rate of duty will be 6.9 cents per kilogram on drained weight.
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 the World Wide Web at http://www.usitc.gov/tata/hts/.
You inquire as to the country of origin of both the unstuffed and stuffed pitted green olives from Morocco, Greece or Egypt. The green olives are said to be grown, harvested, and cured in Morocco, Greece or Egypt, then shipped to Spain where they are pitted, stuffed and repackaged for retail sale in glass jars with brine (water, salt, lactic acid, and citric acid), not more than 1 kg drained, net packed.
The "country of origin" is defined in 19 CFR 134.1(b) as "the country of manufacture, production, or growth of any article of foreign origin entering the United States. 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 the meaning of this part.
The courts have held that a substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993); Anheuser Busch Brewing Association v. The United States, 207 U.S. 556 (1908) and Uniroyal Inc. v. United States, 542 F. Supp. 1026 (1982). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983). Substantial transformation determinations are based on the totality of the evidence. See Headquarters Ruling (HQ) W968434, date January 17, 2007, citing Ferrostaal Metals Corp. v. United States, 11 CIT 470, 478, 664 F. Supp. 535, 541 (1987).
The pitting and stuffing process performed in Spain does not change the origin of the green olives because the process in Spain does not result in a substantial transformation of the green olives. In short, the process begins with green olives and ends with green olives. As a result, the stuffed and unstuffed pitted green olives will be considered a product of the country in which the olives are grown, namely Morocco, Greece, or Egypt.
The marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that:
Except as hereinafter provided, every article of foreign origin (or its container, as provided in subsection (b) hereof) imported into the United States 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 an ultimate purchaser in the United States 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.
As provided in section 134.41(b), Customs Regulations (19 CFR 134.41(b)), the country of origin marking is considered conspicuous if the ultimate purchaser in the U.S. is able to find the marking easily and read it without strain.
With regard to the permanency of a marking, section 134.41(a), Customs Regulations (19 CFR 134.41(a)), provides that as a general rule marking requirements are best met by marking worked into the article at the time of manufacture. For example, it is suggested that the country of origin on metal articles be die sunk, molded in, or etched. However, section 134.44, Customs Regulations (19 CFR 134.44), generally provides that any marking that is sufficiently permanent so that it will remain on the article until it reaches the ultimate purchaser unless deliberately removed is acceptable.
Therefore, marking the individual jars of olives with “Product of Morocco,” “Product of Greece,” or “Product of Egypt,” depending on where the olives were grown, would be accepteable markings.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
This merchandise is subject to The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act), which is regulated by the Food and Drug Administration (FDA). Information on the Bioterrorism Act can be obtained by calling FDA at 301-575-0156, or at the Web site ww.fda.gov/oc/bioterrorism/bioact.html.
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, contact National Import Specialist Bruce N. Hadley Jr. at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division