CLA-2-39:OT:RR:NC:N:5: 137
Gianluca Boncompagni
KB Equipment SA
Calle Jacarandas, B13 San Jose 10905 Costa Rica
RE: The tariff classification and status under the Dominican Republic-Central America-United States Free Trade Agreement (DR-CAFTA), of polylactic acid (PLA) biodegradable plastic straws from Costa Rica.
Dear Ms. Boncompagni:
In your letter dated October 1, 2024, you requested a ruling on the status of polylactic acid (PLA) straws from Costa Rica under the DR-CAFTA.
SKU number PLA06X210 is referred to as Ecorevolution PLA Straws. The straws are composed of 80 percent PLA and 20 percent of a polybutylene adipate terephthalate (PBAT) resin with mineral filler. The product is marketed as a single use compostable straw.
The U.S. origin PLA and the Spanish origin PBAT resin are exported to Costa Rica.
In Costa Rica, the PLA and PBAT are melted together at a ratio of 80 percent PLA and 20 percent PBAT. Once the material is liquified, it is extruded through a small spindle to form a long straw-shaped product. This long tube is sent into a cutting machine that cuts the product into individual straws measuring 6 mm x 201 mm each. The straws are packaged into bags or boxes and exported to the United States.
The applicable tariff provision for the PLA straws will be 3917.32.0050, Harmonized Tariff Schedule of the United States (HTSUS), which provides for tubes, pipes and hoses and fittings therefor, of plastics: other tubes, pipes and hoses: other, not reinforced or otherwise combined with other materials, without fittings: other. The general rate of duty will be 3.1 percent ad valorem.
General Note 29, HTSUS, sets forth the criteria for determining whether a good is originating under the DR-CAFTA. General Note 29(b), HTSUS, (19 U.S.C. 1202) states, in pertinent part, that
For the purposes of this note, subject to the provisions of subdivisions (c), (d), (m) and (n) thereof, a good imported into the customs territory of the United States is eligible for treatment as an originating good under the terms of this note if-
(i) the good is a good wholly obtained or produced entirely in the territory of one or more of the parties to the Agreement;
(ii) the good was produced entirely in the territory of one or more of the parties to the Agreement, and-
(A) each of the non-originating materials used in the production of the good undergoes an applicable change in tariff classification specified in subdivision (n) of this note; or
(B) the good otherwise satisfies any applicable regional value content or other requirements specified in subdivision (n) of this note;
and the good satisfies all other applicable requirements of this note; or
(iii) the good was produced entirely in the territory of one or more of the parties to the Agreement exclusively from originating materials.
As the straws contain non-originating materials, they must undergo an applicable change in tariff classification in order to meet the requirements of GN 29(b)(ii)(A).
The specific rule for GN 29(n).39.2 states:
A change to subheadings 3916.10 through 3918.90 from any other subheading.
The PBAT resin, shipped from Spain to Costa Rica is classified in subheading 3907.99. Therefore, it undergoes the applicable change in tariff classification.
Based on the facts provided, the straws described above qualify for DR-CAFTA preferential treatment, because they will meet the requirements of HTSUS General Note 29(b)(ii)(A) and GN 29(n)/39.2. The straws will therefore be entitled to a free of duty under the DR-CAFTA upon compliance with all applicable laws, regulations, and agreements.
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.
The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP.
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 Christina Allen at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division