CLA-2-20: RR: NC: SP: 231 R03782
Ms. Jennifer Vaughn
American Capital Strategies Group
02 Bethesda Metro Center (14th floor)
Bethesda, MD 20814
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a peanut paste from Mexico; Article 509
Dear Ms. Vaughn:
In your letter dated April 19, 2006, you requested a ruling on behalf of your client, nSpired Natural Foods, on the NAFTA status of a peanut paste from Mexico.
The merchandise is described as a 100 percent peanut paste that will be manufactured in Mexico from a 50/50 blend of Chinese and Mexican peanuts. The Chinese peanuts will be blanched in China, before shipment to Mexico, where they will be mixed together with Mexican peanuts, and then roasted and ground into the peanut paste. The finished peanut paste will be shipped in bulk to the United States to be processed into peanut butter for the U.S. market.
The applicable subheading for peanut paste, if entered under quota, will be 2008.11.0500, Harmonized Tariff Schedule of the United States (HTSUS), which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together, peanuts (ground-nuts), peanut butter and paste, described in additional U.S. note 5 to chapter 20 and entered pursuant to its provisions. The rate of duty will be free.
The applicable subheading for peanut paste, if entered outside the quota, will be 2008.11.1500, HTSUS, which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed together, peanuts (ground-nuts), peanut butter and paste, other. The rate of duty will be 131.8 percent ad valorem. In addition, products classified in subheading 2008.11.1500, HTS, will be subject to additional duties based on their value, as described in subheadings 9904.20.01 – 9904.20.10, HTSUS.
General Note (GN) 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.
General Note (s)(ii), Exceptions to Change in Tariff Classification Rules, states that
(ii) Fruit, nut and vegetable preparations of chapter 20 that have been prepared or preserved merely be freezing, by packing (including canning) in water, brine or natural juices, or by roasting, either dry or in oil (including processing incidental to freezing, packing, or roasting), shall be treated as an originating good only if the fresh good were wholly produced or obtained entirely in the territory of one or more of the NAFTA parties.
The blending and roasting of the peanuts in Mexico would not change the origin of the Chinese peanuts as products of China. Further, should the processing described in GN (s)(ii) not have been an issue, the tariff shift required by GN (t) Chapter 20 3. requires “a change to subheading 2008.11 from any other chapter.
Blanched peanuts,--the product imported into Mexico,--are classifiable in heading 20.08, HTS and, accordingly, would fail to meet the required tariff shift.
As noted above, the merchandise does not qualify for preferential treatment under the NAFTA because none of the above requirements are met.
Regarding the marking, country of origin, for this product, applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that the imported peanut paste is a good of both China and Mexico for marking purposes.
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, 1300 Pennsylvania Ave. N.W., (Mint Annex), Washington, D.C. 20229.
Additional requirements may be imposed on this product by the Food and Drug Administration. You may contact the FDA at:
Food and Drug Administration
Waterview Corp. Cntr.
10 Waterview Boulevard, 3rd Floor
Parsippany, NJ 07054
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 telephone number (301) 575-0156, or at the Web site www.fda.gov/oc/bioterrorism/bioact.html.
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/.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).
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 Thomas Brady at 646-733-3030.
Sincerely,
Robert B. Swierupski
Director,
National Commodity
Specialist Division