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HQ 956677





April 4, 1995
CLA-2 R:C:M 956677 KCC

CATEGORY: CLASSIFICATION

TARIFF NO.: 6912.00.48

Mr. Philip Freeman
Cain Customs Brokers
Progreso International Bridge
P.O. Box 10
Progreso, Texas 78579

RE: ceramic microwavable hotplate; ceramic article; Note 1 and Additional U.S. Note 1, Chapter 69; other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china; EN 69.12; NAFTA; Article 509; General Note 12(b)(ii)(A); originating good; non-originating material; tariff shift; General Note 12(t)/69; 19 CFR 134.1(b); country of origin; Marking Rules; 134.1(j), (g); 134.45(a)(2); production; foreign material; simple assembly; NY 898114 affirmed

Dear Mr. Freeman:

This is in response to your letter of June 27, 1994, on behalf of IMTCO, Inc., requesting reconsideration of New York (NY) 898114 dated June 3, 1994, issued by Area Director, New York Seaport, which classified a ceramic microwavable hotplate under subheading 6912.00.48, Harmonized Tariff Schedule of the United States (HTSUS), as other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china. Additionally, you seek a determination regarding the country of origin and applicability of the North American Free Trade Agreement (NAFTA), to the ceramic hotplate. A sample, bill of materials, cost and weight comparisons and advertising literature were submitted for our examination. We regret the delay in responding.

FACTS:

New York (NY) 898114, classified the ceramic hotplate under subheading 6912.00.48, Harmonized Tariff Schedule of the United States (HTSUS), which provides for "Ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china...Tableware and kitchenware...Other...Other...Other...Other...." NY 898114 described the ceramic hotplate as follows:

The sample submitted is a ceramic "microwavable hotplate" which consists of a 6 inch square ceramic plate encompassed by a inert binder, composed from the urethane family of chemicals, which serves both as a support and stand for the plate. It is stated that this "hotplate" is designed to be placed in a microwave oven and heated for a desired time. It is further claimed that the longer the plate is heated in the microwave, the longer this plate will remain hot (noting that the inert binder is not heated by the RF waves of the microwave oven).

You now state that some of the information contained in your original ruling request of May 11, 1994, was in error, and therefore, the classification of the ceramic hotplate in NY 898114 is incorrect. Specifically, your original ruling request stated that the hotplate tiles were all ceramic. You now state that the two larger tiles are not ceramic but are silica blocks known as quarry tile, which is a course-grained material similar to terra-cotta.

Additionally, you state that the ceramic hotplates will be produced in two different manufacturing runs in Mexico from raw materials which are the products of Great Britain, U.S. and Mexico. You describe the production operation as follows:

The hotplate is constructed of 2 silica quarry tiles which collect and store the heat of the microwave oven, and a ceramic tile that also collects heat but whose primary purpose is decorative. These tiles are surrounded by an inert binder which is not heated by the RF waves of the microwave oven, thus remaining cool to the touch. This binder is made of fine particle sand known as microspheres based on aluminum silicate, to which is added a small amount of colorant made of carbon black (FeO2). A synthetic urethane-family glue (Isocyate), is added to the mix to form a dough. This dough is placed around the quarry tile in a mold, and the ceramic tile is placed on top. An air press compacts the dough around the tile. After release from the mold, the dough material cures at room temperature for 24 hours. The product is sanded and polished to finish, and then packed for shipment.

You submitted the following information regarding the materials used in the two different manufacturing runs:

1st MANUFACTURING RUN:
Component Ingredient Country of Origin

Molded Base Alumina Silicate Filler Great Britain Synthetic Urethane Binder U.S.
Ferrous Oxide Dye U.S.

Heating Core Silica Block Great Britain

Decorative Top Ceramic Tile Great Britain

2nd MANUFACTURING RUN:
Component Ingredient Country of Origin

Molded Base Alumina Silicate Filler Great Britain Synthetic Urethane Binder U.S.
Ferrous Oxide Dye U.S.

Heating Core Silica Block Mexico

Decorative Top Ceramic Tile Mexico

You submitted the following cost and weight comparisons:

Material Weight %Weight Cost %Cost

Aluminum Silicate 1.102 lb. 43.71 0.41 lb 0.2137 Synthetic Urethane 0.248 lb. 9.84 1.50 lb. 0.1760 Ferrous Oxide 0.0625 lb. 2.50 1.85 lb. 0.0547 Silica Block 0.563 lb./ 22.33 1.50 sq. ft. 0.0788 0.111 sq. ft.
Ceramic Tile 1 each 21.62 0.423@ 0.2000

The box for the ceramic hotplate has a taped on white label stating:

Niche Marketing, Inc. 622-D Guilford College Road Greensboro, NC 27409 Assembled under License In Mexico Product of North America.

ISSUE:

I. Is the ceramic hotplate classified under subheading 6912.00.48, HTSUS, as other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china?
II. Is the ceramic hotplate eligible for preferential tariff treatment under the NAFTA pursuant to General Note 12(b), HTSUS?
III. What is the country of origin and the proper marking requirements applicable to the ceramic hotplate?

LAW AND ANALYSIS:

I. Tariff Classification

The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUS, states, in part, that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes...."

NY 898114 classified the ceramic hotplate under subheading 6912.00.48, HTSUS, as other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china. You contend that this is incorrect, because the two larger tiles, i.e., the heating core and decorative top, are not ceramic but silica blocks known as quarry tile, which is a course-grained material similar to terra-cotta.

Subheading 6912.00.48, HTSUS, falls within Chapter 69, HTSUS, making the Chapter 69, HTSUS, notes applicable to this classification. Note 1, Chapter 69, HTSUS, states, in part, that "[t]his chapter applies only to ceramic products which have been fired after shaping...." Therefore, the two larger tiles must meet the definition of a ceramic article, set forth in Additional U.S. Note 1, Chapter 69, HTSUS, as follows:

For the purposes of this chapter, a "ceramic article" is a shaped article having a glazed or unglazed body of crystalline or substantially crystalline structure, the body of which is composed essentially of inorganic nonmetallic substances and is formed and subsequently hardened by such heat treatment that the body, if reheated to pyrometric cone 020, would not become more dense, harder, or less porous, but does not include any glass articles.

If the heating core and decorative top meet the requirements of Note 1, and Additional U.S. Note 1, Chapter 69, HTSUS, they will be considered ceramic articles.

Customs Laboratory Report #3-95-30669-001 dated January 12, 1995, analyzed the composition of the heating core and decorative top of the ceramic hotplate and found:

THE SAMPLE CONSISTS OF A GROOVED BASE AND A DECORATIVE TOP WHICH ARE BOUND TOGETHER WITH A RESIN AND ARE PART OF A MICROWAVEABLE HOTPLATE. THE BASE IS COMPOSED OF SILICA (QUARTZ) AND MULLITE (WHICH WAS PRODUCED ARTIFICIALLY). THE TOP IS OF EARTHENWARE COMPOSED ESSENTIALLY OF CLAY. THE TOP AND BASE EACH MEET THE REQUIREMENTS OF NOTE 1 AND ADDITIONAL U.S. NOTE 1 TO CHAPTER 69, HTSUS, FOR CERAMIC ARTICLES.

Based on this laboratory report, we are of the opinion that the heating core and decorative top are ceramic articles pursuant to Note 1, and Additional U.S. Note 1, Chapter 69, HTSUS.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes (ENs) may be consulted. The ENs, although not dispositive nor legally binding, provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See, T.D. 89-80, 54 Fed. Reg. 35127, 35128, (August 23, 1989). EN 69.12 (pg. 922) states, in pertinent part, that heading 6912, HTSUS, includes:

(A) Tableware such as tea or coffee services, plates, soup tureens, salad bowls, dishes and trays of all kinds, coffee-pots, teapots, sugar bowls, beer mugs, cups, sauce-boats, fruit bowls, cruets, salt cellars, mustard pots, egg-cups, teapot stands, table mats, knife rests, spoons and serviette rings.

(B) Kitchenware such as stew-pans, casseroles of all shapes and sizes, baking or roasting dishes, basins, pastry or jelly moulds, kitchen jugs, preserving jars, storage jars and bins (tea caddies, bread bins, etc.), funnels, ladles, graduated kitchen capacity measures and rolling-pins....

The ceramic hotplate is similar to the exemplars in EN 69.12. The ceramic hotplate is used in the kitchen and on the table as a heating pad and serving pad. It keeps the dishes warm and protects table surfaces from hot dishes. We are of the opinion that it is of the class or kind of article classified under heading 6912, HTSUS. Specifically, it is classified under subheading 6912.00.48, HTSUS, as other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china.

II. NAFTA Eligibility

To be eligible for tariff preferences under the NAFTA, goods must be "originating goods" within the rules of origin in General Note 12(b), HTSUS. In this situation there are two different manufacturing runs using non-originating components. Therefore, an examination of both manufacturing runs must be undertaken. Because the ceramic hotplate is made from components imported from non-NAFTA countries, to be "goods originating in the territory of a NAFTA party" the goods must be "transformed in the territory of Canada, Mexico and/or the United States" pursuant to General Note 12(b)(ii)(A), HTSUS, which states:
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 subdivision (r), (s) and (t) of this note or the rules set forth therein....

In this case, we must examine whether the ceramic hotplate is "transformed in the territory of Canada, Mexico and/or the United States" pursuant to General Note 12(b)(ii)(A), HTSUS. The ceramic hotplate is classified under subheading 6912.00.48, HTSUS. Therefore, a transformation is evident when a change in tariff classification occurs that is authorized by General Note 12(t)/69, HTSUS. General Note 12(t)/69, HTSUS, states:

A change to headings 6901 through 6914 from any other chapter.

Therefore, any non-originating components of the ceramic hotplate must come from a chapter other than chapter 69, HTSUS.

In the 1st manufacturing run, the non-originating components are the alumina silicate filler, ceramic heating core (silica block) and ceramic decorative top. The ceramic heating core and ceramic decorative top are classified in Chapter 69, HTSUS, therefore, a change in tariff classification does not occur. The ceramic hotplate manufactured using the components described in the 1st manufacturing run do not meet the tariff shift requirement of General Note 12(t)/69, HTSUS, and therefore, are not considered "originating goods" pursuant to General Note

In the 2nd manufacturing run, the only non-originating component is the alumina silicate filler. You described the alumina silicate as fine particle sand known as microspheres based on aluminum silicate. Depending upon its exact composition the alumina silicate is classifiable under either chapter 25 or 26, HTSUS. The non-originating alumina silicate has met the tariff shift requirement of General Note 12(t)/69, HTSUS, and, therefore the ceramic hotplate in the 2nd manufacturing run is considered an "originating good" pursuant to General Note 12(b)(ii)(A), HTSUS.

III. Country of Origin and Marking

The marking statute, section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin (or its container) 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 the 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.

The country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the NAFTA, as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057) (December 8, 1993) and the interim amendments to the Customs Regulations published as T.D. 94-4 (59 Fed. Reg. 109, January 3, 1994) with corrections (59 Fed. Reg. 5082, February 3, 1994) and T.D. 94-1 (59 Fed. Reg. 69460, December 30, 1993). These interim amendments took effect on January 1, 1994, to coincide with the effective date of the NAFTA. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in T.D. 94-4 (adding a new Part 102, Customs Regulations). The marking requirements of these goods are set forth in T.D. 94-1 (interim amendments to various provisions of Part 134, Customs Regulations).

Section 134.1(b) of the interim regulations, defines "country of origin" as:
the country of manufacture, production, or growth of any article of foreign origin entering the U.S. 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"; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin (emphasis added).

Section 134.1(j) of the interim regulations, provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) of the interim regulations, defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules. Section 134.45(a)(2) of the interim regulations, provides that "a good of a NAFTA country may be marked with the name of the country of origin in English, French, or Spanish."

Part 102 of the interim regulations, 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 interim regulations, sets forth the required hierarchy for determining country of origin for marking purposes. Section 102.11(a) of the interim regulations states that "[t]he country of origin of a good is the country in which:

(1) The good is wholly obtained or produced; (2) The good is produced exclusively from domestic materials; or (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 requirements of these rules are satisfied."

In this case, the applicable rule is section 102.11(a)(3) of the interim regulations. "Foreign Material" is defined in section 102.1(e) of the interim regulations 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." In order to determine whether Mexico is the country of origin, we must look at those materials whose country of origin is other than Mexico. Therefore, in the 1st manufacturing run all the materials are considered to be foreign material. However, the foreign materials in the 2nd manufacturing run are the alumina silicate, synthetic urethane binder and ferrous oxide dye.

As the ceramic hotplate is classified under subheading 6912.00.48, HTSUS, the change in tariff classification must be made in accordance with section 102.20(m), Section XIII: Chapters 68 through 70, 6901-6914 of the interim regulations, which states that:

A change to heading 6901 through 6914 from any other chapter.

Therefore, each foreign material incorporated in the ceramic hotplate must come from a chapter other than chapter 69, HTSUS.

In the 2nd manufacturing run a change in tariff classification pursuant to section 102.20(m), Section XIII: Chapters 68 through 70, 6901-6914 of the interim regulations, does take place. The foreign components are the alumina silicate which is classifiable depending on the actual composition in either chapter 25 or 26, HTSUS, the synthetic urethane binder which is classifiable in chapter 39, HTSUS, and the ferrous oxide dye which is classifiable in chapter 28, HTSUS. Therefore, pursuant to section 102.20(m), Section XIII: Chapters 68 through 70, 6901-6914 of the interim regulations, the country of origin of the ceramic hotplate in the 2nd manufacturing run is Mexico.

However, in the 1st manufacturing run, a change in the tariff classification does not take place for the foreign ceramic heating core and ceramic decorative top. As stated, both of these foreign components are classified in chapter 69, HTSUS. In the 1st manufacturing run, a change in tariff classification does not occur pursuant to section 102.20(m), Section XIII: Chapters 68 through 70, 6901-6914 of the interim regulations. Therefore, country of origin cannot be determined under section 102.11(a) of the interim regulations.

Section 102.11(b) of the interim regulations states that:

Except for a good that is specifically described in the Harmonized System as a set, or is classified as a set pursuant to General Rule of Interpretation 2, where the country or origin cannot be determined under paragraph (a), the country of origin of the good:

(1) Is the country or countries of origin of the single material that imparts the essential character of the good...(emphasis added).

When determining the essential character of a good under section 102.11 of the interim regulations, section 102.18(b) of the interim regulations provides that only domestic and foreign materials that are classified in a tariff provision from which a change is not allowed i.e., heating core and decorative top, shall be taken into consideration and that in deciding among these materials consideration is given to various factors, including the nature of the material or component, bulk, quantity, weight, value, role of a constituent material in relation to the use of the goods. Based on these factors, we find that the ceramic heating core and ceramic decorative top contribute equally to the function of the hotplate. Both the ceramic heating core and the ceramic decorative top hold and generate the heat necessary to keep a serving dish warm. Therefore, we conclude that no single material imparts the essential character to the ceramic hotplate.

Since we are unable to determine the country of origin of the 1st manufacturing run ceramic hotplate pursuant to section 102.11(b)(1) of the interim regulations, we proceed to section 102.11(c) of the interim regulations. Section 102.11(c) is inapplicable in this situation as the ceramic hotplate is not classified as a set, mixture or composite good pursuant to GRI 3, HTSUS. Therefore, we proceed to section 102.11(d) of the interim regulations which states that:

Where the country of origin of a good cannot be determined under paragraphs (a) through (c), the country of origin of the good is:

(1) The last country in which the good underwent production, other than by simple assembly or minor processing....

In Mexico, the foreign materials, aluminum silicate, synthetic urethane and ferrous oxide are manufactured into an inert binder which is molded around the ceramic heating core and decorative top. The molded form produced in Mexico from the inert binder which is classifiable as other articles of stone or other mineral substances under heading 6815, HTSUS, is a domestic material. See, section 102.20(m), Section XIII: Chapters 68 through 70, 6815 of the interim regulations. Because not all of the parts of the ceramic hotplate in the 1st manufacturing run are foreign , its production in Mexico did not result from a "simple assembly" and it exceeded "minor processing." See, sections 102.1(n) and (o) of the interim regulations. Therefore, pursuant to section 102.11(d)(1) of the interim regulations, the country of origin of the 1st manufacturing run ceramic hotplate is also Mexico.

Your proposed country of origin label is:

Niche Marketing, Inc. 622-D Guilford College Road Greensboro, NC 27409 Assembled under License In Mexico Product of North America.

"Product of North America" is an unacceptable marking for the ceramic hotplate. The label must state "Product of Mexico" or "Made in Mexico", or other similar wording.

HOLDING:

The ceramic hotplate is classified under subheading 6912.00.48, HTSUS, as other ceramic tableware, kitchenware, other household articles and toilet articles, other than of porcelain or china. NY 898114 is affirmed.

Based on the information presented the ceramic hotplate in the 1st manufacturing run is not considered an "originating good" pursuant to General Note 12(b)(ii)(A), HTSUS. However, the ceramic hotplate in the 2nd manufacturing run is considered an "originating good" pursuant to General Note 12(b)(ii)(A), HTSUS, provided all other applicable requirements are met.

Pursuant to section 102.11 of the interim regulations, the ceramic hotplate in the 1st and 2nd manufacturing runs are considered to be products of Mexico for purposes of country of origin marking.

Sincerely,

John Durant, Director
Commercial Rulings Division

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