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NY J83535





May 30, 2003

CLA-2-19:RR:NC:2:228 J83535

CATEGORY: CLASSIFICATION

TARIFF NO.: 1901.90.4200; 1901.90.4300

Mr. Graeme Honeyfield
Glinso Foods
3554 Round Barn Blvd.
Santa Rosa, CA 95403

RE: The tariff classification, status under the North American Free Trade Agreement (NAFTA), and country of origin marking of a milk-based product from Canada; Article 509

Dear Mr. Honeyfield:

In your letter dated April 9, 2003 you requested a ruling on the status of a milk-based product from Canada under the NAFTA.

A sample, ingredients breakdown, and technical data sheet were submitted with your letter. The sample was examined and disposed of. Flavored Dehydrated Skim Milk Blend is a cream-colored powder with an identifiable vanilla aroma, said to be composed of 80-90 percent non fat milk solids, 10-20 percent lactose, 0.2-0.6 percent silicon dioxide, and 0.15 percent vanilla flavor. The product will be packaged in 25-kilogram plastic-lined bags or 500- and 1000-kilogram bulk totes for industrial users, and in 8-30 ounce cans for food service use. The Flavored Dehydrated Skim Milk Blend is used as an ingredient in hot and cold beverages, dry mixes, and vending machines.

The non fat milk solids will be a product of Canada. The lactose, silicon dioxide, and vanilla flavor may be products of the United States or Canada. In Canada, the ingredients are blended in the noted proportions and packaged.

The applicable subheading for the Flavored Dehydrated Skim Milk Blend, if imported in quantities that fall within the limits described in additional U.S. note 10 to chapter 4, will be 1901.90.4200, Harmonized Tariff Schedule of the United States (HTS), which provides for food preparations of goods of headings 0401 to 0404, not containing cocoanot elsewhere specified or includedotherother dairy products described in additional U.S. note 1 to chapter 4dairy preparations containing over 10 percent by weight of milk solidsdescribed in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. The rate of duty will be 16 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 1901.90.4300, HTS, and dutiable at the rate of $1.035 per kilogram plus 13.6 percent ad valorem.

The Flavored Dehydrated Skim Milk Blend, when classified in subheading 1901.90.4200, HTS, being wholly obtained or produced entirely in the territory of Canada and the United States, 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.

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 to 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.

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 Flavored Dehydrated Skim Milk Blend is a good of a Canada for marking purposes.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 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 Stanley Hopard at 646-733-3029.

Sincerely,

Robert B. Swierupski
Director,

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