CLA-2-38:OT:RR:NC:N3:139
David Soyka
H. C. Starck Tungsten LLC
25 Grove Street, Suite 2-400
Newton, MA 02466
RE: The tariff classification and eligibility of the United States-Mexico-Canada Agreement (USMCA) of Cast Tungsten Carbide Matrix Powder from Canada
Dear Mr. Soyka:
In your letter received in our office on April 10, 2023, and an earlier submission dated February 16, 2023, you requested a binding ruling on the tariff classification and eligibility of a cast tungsten carbide matrix powder under the United States-Mexico-Canada Agreement (USMCA).
In your submissions, you stated after importation into the United States, the completed cast tungsten carbide matrix powder would eventually be used in the manufacture of drill bits, such as those used by the oil and gas industry, to cut through very hard rock. Canadian and German origin non agglomerated tungsten carbide, classified under subheading 2849.90.30, Harmonized Tariff Schedule of the United States (HTSUS) along with German origin nickel powder, classified under subheading 7504.00.0010 HTSUS would be blended together at your facility in Sarnia, Canada until each ingredient reached a specified range of concentration. Documentary evidence of this was provided within the submission.
In your request, you suggested a classification of the cast tungsten carbide matrix powder under subheading 3824.30.00 HTSUS. We concur.
Classification:
The applicable subheading for the cast tungsten carbide matrix powder will be 3824.30.0000, HTSUS, 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: Nonagglomerated metal carbides mixed together or with metallic binders. The rate of duty will be 3.6 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 at https://hts.usitc.gov/current.
USMCA:
The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. § 4511(a)). General Note ("GN") 11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good is an originating good for purposes of the USMCA. GN 11(b) states:
For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a "good originating in the territory of a USMCA country" only if-
(i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries;
(ii) the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials;
(iii) the good is a good produced entirely in the territory of one or more USMCA countries using non-originating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o));
Since the cast tungsten carbide matrix powder contains non-originating ingredients, it is not considered a good wholly obtained or produced entirely in a USMCA country under GN 11(b)(i), nor is the product produced exclusively from originating materials per GN 11(b)(ii). Thus, we must determine whether the product qualifies under GN 11(b)(iii). As previously noted, the cast tungsten carbide matrix powder is classified under subheading 3824.30.0000, HTSUS. The applicable rule of origin for goods classified under subheading 3824.30.0000, HTSUS, is in GN 11(o)/38.5(A), HTSUS, which provides for “a change to subheadings 3823.11 through 3826.00 from any other subheading, including another subheading within that group.”
Based on the facts provided, the good described above qualifies for USMCA preferential tariff treatment, because it will meet the requirements of HTSUS General Note 11(b)(iii). The good will therefore be entitled to a free rate of duty under the USMCA upon compliance with all applicable laws, regulations, and agreements.
This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection 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 John Bobel at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division