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NY R02949

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December 19, 2005

CLA-2-17:RR:NC:SP:232 R02949

CATEGORY: CLASSIFICATION

TARIFF NO.: 1701.99.1090; 1701.99.5090

Mr. Graeme R. Honeyfield
Glinso Foods
3554 Round Barn Blvd., Ste. 310
Santa Rosa, CA 95403

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a sugar/corn starch blend from Mexico; Article 509

Dear Mr. Honeyfield:

In your letter dated December 8, 2005 you requested a ruling on the status of a sugar/corn starch blend from Mexico under the NAFTA. Your request also asks for the country of origin for marking purposes of the product.

The subject merchandise is SS 992 Blend and is stated to contain 98 percent refined cane or beet sugar (minimum polarity of 99.7 degrees) and 2 percent corn starch. The sugar in the blend will be grown and refined in the United States or Mexico, refined in Mexico, the United States or Canada from non-NAFTA raw sugar, or grown and refined in a non-NAFTA country. The corn starch will be manufactured in the United States from corn grown in the USA. The product will be packaged in 25 kilogram bags, 500 to 1000 kilogram bulk sacks, or in bulk railcars or trucks.

The applicable subheading for the SS 992 Blend, if described in additional U.S. note 5 to chapter 17 and entered pursuant to its provisions, will be 1701.99.1090, Harmonized Tariff Schedule of the United States (HTS), which provides for cane or beet sugar and chemically pure sucrose, in solid form: other; otherother. The general rate of duty will be 3.6606 cents per kilogram less 0.020668 cents per kilogram for each degree under 100 degrees (and fractions of a degree in proportion) but not less than 3.143854 cents per kilogram. If not described in additional U.S. note 5 to chapter 17 and not entered pursuant to its provisions, the applicable subheading will be 1701.99.5090, HTS. The general duty rate will be 35.74 cents per kilogram. In addition, except for goods of Canada, Mexico, Jordan, Singapore, Chile, or Australia products classified under subheading 1701.99.5090, HTS, will be subject to additional duties based on their value as described in subheadings 9904.17.08 to 9904.17.15, HTS.

Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at http://www.usitc.gov/tata/hts/.

The SS 992 Blend is not classified under subheading 1901.90.5400, HTS, because the essential character of this mixture is imparted by the sugar, noting GRI 3(b).

General Note 12(b), HTSUS, sets forth the criteria for determining whether a good is originating under the NAFTA. General Note 12(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that

For the purposes of this note, goods imported into the customs territory of the United States are eligible for the tariff treatment and quantitative limitations set forth in the tariff schedule as "goods originating in the territory of a NAFTA party" only if--

(i) they are goods wholly obtained or produced entirely in the territory of Canada, Mexico and/or the United States; or

(ii) they have been transformed in the territory of Canada, Mexico and/or the United States so that--

(A) except as provided in subdivision (f) of this note, each of the non-originating materials used in the production of such goods undergoes a change in tariff classification described in subdivisions (r), (s) and (t) of this note or the rules set forth therein, or

(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or

(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or

(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for "parts" and used in the production of such goods does not undergo a change in tariff classification because--

(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or

(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.

Based on the facts provided, when the sugar is grown and refined in the United States or Mexico the good described above qualifies for NAFTA preferential treatment, because it will meet the requirements of HTSUS General Note 12(b)(i). If classified under subheading 1701.99.1090, HTS, the SS 992 Blend will be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements. If classified under subheading 1701.99.5090, HTS, the SS 992 Blend will be dutiable at the rate of 10.583 cents per kilogram less 0.15 cents per kilogram for each degree under 100 degrees (and fractions of a degree in proportion) but not less than 6.845 cents per kilogram under the NAFTA upon compliance with all applicable laws, regulations and agreements.

When the sugar is refined in Mexico, the United States or Canada from raw sugar produced in a non-NAFTA country, or when the sugar is grown and refined in a non-NAFTA country, the merchandise does not qualify for preferential treatment under the NAFTA because none of the above requirements are met.

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 marked sample was not 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.

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 SS 992 Blend is processed in a NAFTA country "Mexico" prior to being imported into the U.S. Since, "Mexico" 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 SS 992 Blend 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 presented, we find that the country of origin for marking purposes of the imported SS 992 Blend is the country where the raw sugar is grown, noting Section 102.11(b)(1).

Noting Section 102.19(b) of the regulations, when the sugar is grown and refined in the United States, making the U.S. the country of origin for marking purposes, the country of origin of the SS 992 Blend for Customs duty purposes and for the quota allocation is “Mexico.”

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 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 646-733-3031.

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 and Border Protection, 1300 Pennsylvania Ave. N.W., (Mint Annex), Washington, D.C. 20229.}

Sincerely,

Robert B. Swierupski
Director,

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See also:

• Tariff No.: 1701.99.10 - Cane/beet sugar & pure sucrose, refined, solid, w/o added coloring or flavoring, subject to add. US 5 to Ch.17
• Tariff No.: 1701.99.50 - Cane/beet sugar & pure sucrose, refined, solid, w/o added coloring or flavoring, not subject to gen. note 15 or add. US 5 to Ch.17
• Tariff No.: 1901.90.54 - Food preps of flour, etc., nesoi, o/65% by dry wt of sugar, described in add. US note 2 to chap. 17: not subj. to add US note 7 to Ch.17
• Tariff No.: 9904.17.08 - Sugars, syrups and molasses, in 1701.12.50, 1701.91.30, 1701.99.50, etc, entered in value safeguard period, under $0.05/kg
• Tariff No.: 9904.17.15 - Sugars, syrups and molasses, in 1701.12.50, 1701.91.30, 1701.99.50, etc, entered in value safeguard period, $0.35/kg or more