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NY D81052




August 21, 1998

CLA-2-15:RR:NC:SP:232 D81052

CATEGORY: CLASSIFICATION

TARIFF NO.: 1504.10.2000; 1504.20.6040

Mr. Jim Wickstead
PBB Global Logistics
434 Delaware Ave.
Buffalo, NY 14202

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of various fish oils from Canada; Article 509

Dear Mr. Wickstead:

In your letter dated July 31, 1998 you requested a ruling on the status of various fish oils from Canada under the NAFTA. Your request also asks for the country of origin for marking purposes of the products.

Information and samples were submitted with your initial request dated April 16, 1998. The subject merchandise consists of five types of oil: Cod Liver Oil, Tuna Oil, Salmon Oil, Shark Liver Oil and Fish Oil (18/12). The Cod Liver oil has a total Omega-3 content of 25 percent plus 2500 IU of Vitamin A, 200 IU of Vitamin D and mixed natural tocopherols (Vitamin E) added as an antioxidant. The Tuna Oil has an Omega-3 content of 35 percent plus mixed natural tocopherols (Vitamin E) added as an antioxidant. The Salmon Oil has an Omega-3 content of 20 percent plus mixed natural tocopherols (Vitamin E) added as an antioxidant. The Shark Liver oil contains a minimum of 20 percent alkyglycerols plus mixed natural tocopherols (Vitamin E) as an antioxidant. The Fish Oil (18/12) has a total Omega-3 content of 35 percent plus mixed natural tocopherols (Vitamin E) added as an antioxidant.

With the exception of the Salmon Oil, which is produced in Canada, all of the oils are manufactured in Norway, and shipped to Canada in large drums. The submitted flow charts indicate that all of the oils are submitted to the processes of refining, winterization, bleaching, deodorization, mixing and drumming. The bulk oils are sent from Norway to Canada, where the only processing performed is mixing with the tocopherols, encapsulating into gelatin capsules and bottling in retail packaging for shipment to the United States. The oils are sold in health food stores as nutritional supplements.

The applicable tariff provision for the Cod Liver Oil will be 1504.10.2000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provided for Fats and oils, and their fractions, of fish or marine mammals, whether or not refined, but not chemically modified: Fish-liver oils and their fractions: Cod. The general rate of duty will be free.

The applicable tariff provision for the Tuna and Salmon Oils will be 1504.20.6040, HTS, which provides for Fats and oils, and their fractions, of fish or marine mammals, whether or not refined, but not chemically modified...Fats and oils and their fractions, of fish, other than liver oils...other...other. The general rate of duty will be 1.5 cents per kilogram plus 5 percent ad valorem.

Your inquiry does not provide enough information for us to give a classification ruling on the Shark Liver Oil and Fish Oil (18/12). For the Shark Liver Oil, your request for a classification ruling should include information on the alkyglycerols including their chemical structure, source, function in the oil, and chemical effect on the oil. It is also noted that the process flow chart does not show this ingredient added to the oil. For the Fish Oil (18/12) indicate the type(s) of fish used to make this product, and whether the oils are from the fish liver.

The Cod Liver Oil is not subject to treatment under the NAFTA because the general rate of duty is free and there is no NAFTA rate shown in the Special column of the Harmonized Tariff Schedules.

The Tuna Oil does not qualify for preferential treatment under the NAFTA because one or more of the non-originating materials used in the production of the good will not undergo the change in tariff classification required by General Note 12(t)/15, HTSUSA.

The Salmon Oil, being wholly obtained or produced entirely in the territory of Canada, will meet the requirements of HTSUSA General Note 12(b)(i), and will therefore be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).

Your inquiry also requests a ruling on the country of origin marking requirements for imported articles which are processed in a NAFTA country prior to being imported into the U.S. Marked samples were submitted with your letter for review.

The marking statute, section 304, 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 U.S. 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 the ultimate purchaser in the U.S. 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 North American Free Trade Agreement ("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 appropriate Customs Regulations. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. The marking requirements of these goods are set forth in Part 134, Customs Regulations.

Section 134.1(b) of the 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 within this part; 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 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 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 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.

You state that the imported fish oil products are processed in a NAFTA country "Canada" prior to being imported into the U.S. Since, "Canada" is defined under 19 CFR 134.1(g), as a NAFTA country, we must first apply the NAFTA Marking Rules in order to determine whether the imported fish oil products are goods of a NAFTA country", and thus subject to the NAFTA marking requirements.

Part 102 of the 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 regulations, sets forth the required hierarchy for determining country of origin for marking purposes.

Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that the imported Salmon Oil is a good of "Canada" for marking purposes, since it satisfies the requirements of Section 102.11(a)(1).

Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that the imported Cod Liver Oil and Tuna Oil are goods of "Norway" for marking purposes, noting Section 102.11(b)(1). Therefore, the submitted samples, which show "Product of Canada" are not legally marked. These products must show "Product of Norway" as the country of origin.

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 John Maria at 212-466-5730.

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 Service, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229.

Sincerely,

Robert B. Swierupski
Director,

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