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NY D80645


August 5, 1998

CLA-2-20:RR:NC:2:231 D80645

CATEGORY: CLASSIFICATION

TARIFF NO.: 2008.11.6000

Mr. Ricky Villena

HLM Intertrans Corp.

5567 Northwest 72nd Avenue

Miami, FL 33166

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of thinly coated peanuts from Mexico; Article 509

Dear Mr. Villena:

In your letter, dated July 16, 1998, you requested a ruling on the status of thinly coated peanuts from Mexico under the NAFTA, on behalf of your client, Productos Nipon S.A. de C.V., Col. Agricola Oriental, Mexico.

An examination of the samples indicates that the merchandise is comprised of thinly coated individual peanuts.

Peanuts of U.S. origin (without shells, with skin) are exported in barrels from the U.S. to Mexico. In Mexico the peanuts are dried, floured, dissolved in water, baked, toasted, seasoned, packed in bags, and shipped to the U.S. The merchandise is described thus:

1. "Japanese Style Peanuts" (sample #1) - The ingredients are peanuts, wheat flour, sugar, water, modified starch, salt, hydrolyzed vegetable protein, monosodium glutamate, caramel coloring, yeast, and chili pepper. During the manufacturing process in Mexico, shelled, American peanuts are deposited in a rotating coating drum, and sugar, water, and wheat flour are added. Then the thinly coated peanuts are roasted, seasoned, cooled, dried, and packed in bags. The net weight of the submitted sample is 100 grams.

2. "Lemon Flavored Peanuts" (sample #2) - The ingredients are peanuts, processed flour, sugar, water, carboxymethyl cellulose, salt, vegetable oil, dehydrated lemon, alcohol, and citric acid. The peanuts are deposited in a rotating coating drum, and sugar, water, and wheat flour are added. Then the thinly coated peanuts are fried (in corn or peanut oil), seasoned, cooled, dried, and packed in bags. The net weight of the submitted sample is 100 grams.

3. "Spicy Peanuts" (sample #3) - The ingredients are peanuts, corn oil, salt, chili pepper, citric acid, and BHT. The peanuts are fried (in corn or peanut oil), seasoned, cooled, dried, and packed in bags. The net weight of the submitted sample is 100 grams.

4. "Caramel Covered Peanuts" (sample #4) - The ingredients are peanuts, sugar, water, and vanilla. The peanuts are placed in a heated drum, and sugar, water and vanilla flavoring are added. Then they are cooled, dried, and packed in bags. The net weight of the submitted sample is 100 grams.

The applicable subheading for "Japanese Style Peanuts" (sample #1), "Lemon Flavored Peanuts" (sample #2), "Spicy Peanuts" (sample #3), and "Caramel Covered Peanuts" (sample #4), will be will be 2008.11.6000, Harmonized Tariff Schedule of the United States (HTS), 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), other, other. The rate of duty will be 139.5 percent ad valorem. In addition, products classified in subheading 2008.11.6000, HTS, will be subject to additional duties based on their value, as described in subheadings 9904.12.01 - 9904.12.19, HTS.

General Note 12(s)(i)(B), HTSUS, articulates the following regarding the North American Free Trade Agreement:

(s) Exceptions to Change in Tariff Classification Rules

(i) Agricultural and horticultural goods grown in the territory of a NAFTA party shall be treated as originating in the territory of that party even if grown from seed, bulbs, rootstock, cuttings, skips or other live parts of plants imported from a non-party to the NAFTA, except that goods which are exported from the territory of Mexico and are provided for in

(B) subheading 2008.11, if any material provided for in heading 1202 used in the production of such goods was not harvested in the territory of Mexico
shall be treated as nonoriginating goods.

Because the raw material (shelled, American peanuts), provided for in heading 1202 and used in the production process, was not harvested in the territory of Mexico, the finished products are considered nonoriginating goods. Accordingly, the thinly coated peanuts are not NAFTA eligible.

Additional requirements may be imposed on these products by the Food and Drug Administration. You may contact the FDA at:

Food and Drug Administration

Division of Regulatory Guidance

200 C Street, S.W.

Washington, DC 200204

This ruling is being issued under the provisions of Part 181 of the CustomsRegulations (19 CFR 181).

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

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 Ralph Conte at (212) 466-5759.

Sincerely,


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