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NY G81292




October 4, 2000

CLA-2-15:RR:NC:SP:232 G81292

CATEGORY: CLASSIFICATION

TARIFF NO.: 1517.90.1040; 1517.90.2040

Ms. Michelle Cotton
CanAmera Foods
2190 South Service Road West
Oakville, Ontario L6L 5N1
Canada

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

Dear Ms. Cotton:

In your letter dated August 28, 2000 you requested a ruling on the status of a frying shortening from Canada under the NAFTA. Your request also asks for the country of origin for marking purposes of the product.

A sample, copy of a product label and information were submitted with an initial request dated January 25, 2000. Additional information was submitted in your letter dated September 28, 2000. The product is described as a frying shortening. It is stated to contain hydrogenated soybean or canola oil from Canada, palm stearin (fractionated) and palm stearin from Malaysia and an anti-foaming agent from Canada. All of the processing is performed in Canada, except for the palm stearin, which is fractionated in Malaysia. The soybean or canola oil and the palm stearin are refined, bleached, deodorized and hydrogenated. The palm stearin (fractionated) is refined bleached and deodorized. The final shortening is produced in Canada and packaged in a 20 kilogram plastic bag inside a corrugated cardboard box.

The applicable tariff provision for the frying shortening containing soybean oil will be 1517.90.1040, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for Margarine; edible mixtures or preparations of animal or vegetable fats or oils or of fractions of different fats or oils of this chapter, other than edible fats or oils or their fractions of heading 1516other: Artificial mixtures of two or more of the products provided for in headings 1501 to 1515, inclusive: containing 5 percent or more by weight of soybean oil or any fraction thereofbaking or frying fats: wholly of vegetable oils. The general rate of duty will be 18 percent ad valorem.

The applicable tariff provision for the frying shortening containing canola oil will be 1517.90.2040, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for Margarine; edible mixtures or preparations of animal or vegetable fats or oils or of fractions of different fats or oils of this chapter, other than edible fats or oils or their fractions of heading 1516other: Artificial mixtures of two or more of the products provided for in headings 1501 to 1515, inclusiveotherbaking or frying fats: wholly of vegetable oils. The general rate of duty will be 8 percent ad valorem.

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

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 an imported article which is processed in a NAFTA country prior to being imported into the U.S. A copy of a product label showing the marking “Product of Canada” was 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 frying shortening is 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 frying shortening is a good 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 frying shortening is a good of "Canada" for marking purposes, since it satisfies the requirements of Section 102.11(a)(3). Therefore, the marking “Product of Canada” on the submitted copy of the product label is an acceptable country of origin marking for the frying shortening.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR Part 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 John Maria at 212-637-7059.

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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