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NY 811138



June 23, 1995

CLA-2-04:S:N:N7:231 811138

CATEGORY: CLASSIFICATION

TARIFF NO.: 0402.29.1000; 0402.29.5000

Mr. Robert Tinkham
Chicago Sweeteners Incorporated
1700 Higgins Road, Suite 610
Des Plaines, IL 60018

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of a dairy product from Canada; Article 509

Dear Mr. Tinkham:

In your letter, dated May 31, 1995, you requested a ruling on the status of a dairy product from Canada under the NAFTA.

The merchandise is a dairy product that will be used as an ingredient in the manufacture of confections and other food products. The ingredients, by weight, are as follows:

1. granulated sugar: 10 percent
2. whole milk powder (28.5 percent fat): 90 percent total butterfat content: 25.7 percent

The sugar that will be used in this product is obtained from various non-NAFTA countries throughout the world. The whole milk powder will be sourced as follows:

ITEM A. whole milk powder produced in Canada ITEM B. whole milk powder produced in non-NAFTA countries

The ingredients are imported into Canada for the manufacture of the dairy product. The process involves the measurement and proportioning of the formula's ingredients, and their introduction from holding tanks and vessels into a stainless steel ribbon blender. The product that is created is homogenous and free-flowing powder. It is then packaged in 50, 100 or 2,000 pound containers for importation into the U.S.

The applicable tariff provision for the dairy products, ITEMS A and B listed above, if imported in quantities that fall within the limits described in additional U.S. note 10 to chapter 4, will be 0402.29.1000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for milk and cream, concentrated or containing added sugar or other sweetening matter, in powder, granules or other solid forms, of a fat content, by weight, exceeding 1.5 percent, other, described in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. The general rate of duty (for ITEM B) will be 17.5 percent ad valorem. If the quantitative limits of additional U.S. note 10 to chapter 4 have been reached, the product will be classified in subheading 0402.29.5000, HTS, and will be dutiable at $ 1.266 per kilogram plus 17.1 percent ad valorem. In addition, products classified in subheading 0402.29.5000, HTS, will be subject to additional duties based on their value, as described in subheadings 9904.04.50 - 9904.05.01.

The dairy product, ITEM A, whose whole milk powder is produced in Canada, and whose non-originating material (granulated sugar) is used in its manufacture, has satisfied the changes in tariff classification required under HTSUSA General Note 12(t)(4). If it is imported in quantities that fall within the limits described in additional U.S. note 10 to chapter 4, the applicable tariff provision will be 0402.29.1000, HTS, which provides for milk and cream, concentrated or containing added sugar or other sweetening matter, in powder, granules or other solid forms, of a fat content, by weight, exceeding 1.5 percent, other, described in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. It will be entitled to a 5.2 percent ad valorem rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements. If the quantitative limits of additional U.S. note 10 to chapter 4 have been reached, the product will be classified in subheading 0402.29.5000, HTS, and will be dutiable at $1.266 per kilogram plus 17.1 percent ad valorem. In addition, products classified in subheading 0402.29.5000, HTS, will be subject to additional duties based on their value, as described in subheadings 9904.04.50 - 9904.05.01.

Importations of these products are subject to import regulations administered by various U.S. agencies. Information regarding applicable regulations administered by the U.S. Department of Agriculture may be addressed to that agency at the following location:

U.S. Department of Agriculture
A.P.H.I.S., Veterinary Services
Federal Building, Room 758
6505 Belcrest Road
Hyattsville, MD 20782
Att: Dr. John Blackwell

Information regarding applicable regulations administered by the U.S. Food and Drug Administration may be addressed to that agency at the following location:

U.S. Food and Drug Adminisration
Division of Regulatory Guidance
HFF 314, 200 C Street, S.W.
Washington, DC 20204

A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is imported. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction.

This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.

Sincerely,

Jean F. Maguire
Area Director

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