Classification and status under the North American FreeTrade Agreement (NAFTA) of low fat Gouda cheese from Canada;Article 509

HQ 959562 April 11, 1997 CLA-2 RR:TC:FC 959562 RC CATEGORY: Classification TARIFF NO.: 0406.90.1600; 0406.90.1800 Mr. Christian Emmanuel Cemma International, Inc. 4829, Avenue Rosedale Montreal, Quebec H4V 2H3 Canada RE: Classification and status under the North American Free Trade Agreement (NAFTA) of low fat Gouda cheese from Canada; Article 509 Dear Mr. Emmanuel: In further response to your letter, dated May 7, 1996, on behalf of your client, La Fabrique Bergeron, Inc., we are issuing this binding classification ruling, under the NAFTA, for the "Seigneur de Tilly" low fat Gouda cheese. Our New York office has issued New York Ruling Letter (NYRL) A84300, dated June 19, 1996, to you, with respect to classification of the "Classic Gouda," the "Popular Extra Mild," and the "Brins de Gouda" cheeses. FACTS: The "Seigneur de Tilly" product, described as low fat Gouda in wheel form, is made from pasteurized cow's milk, bacterial culture, salt, rennet, and calcium chloride. The cheese contains, by weight, 51 percent moisture, and 30.6 percent milk fat in the dry matter. The cheese is to be made from milk of Canadian origin. All other ingredients will be of either Canadian or United States origin. ISSUE: Whether the "Seigneur de Tilly" low fat Gouda cheese is properly classifiable in the tariff provision for Gouda cheese. LAW AND ANALYSIS: Classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is made in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the harmonized system is such that virtually all goods are classified by application of GRI 1, that is, according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System, which represent the official interpretation of the tariff at the international level, facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRIs. Customs has held in ORR Ruling 790-68, dated December 26, 1968, that low fat Gouda cheese is classifiable as Gouda cheese, even if it is outside of the parameters of the Food and Drug Administration standards. See, ORR Ruling 790-68 (copy enclosed). In keeping with this long held position, we find that the instant low fat Gouda cheese is likewise classifiable as Gouda cheese. HOLDING: The "Seigneur de Tilly" low fat Gouda cheese, 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). Upon compliance with all applicable laws, regulations, and agreements under NAFTA, articles from Canada, if imported in quantities that fall within the limits described in additional U.S. note 20 to chapter 4, will be classified in subheading 0406.90.1600, HTSUSA, and will be subject to a 3 percent ad valorem rate of duty. If the quantitative limits of additional U.S. note 20 to chapter 4 have been reached, the products will be classified in subheading 0406.90.1800, HTSUSA, and will be dutiable at US $2.015 per kilogram. In addition, products classified in subheading 0406.90.1800, HTSUSA, will be subject to additional duties based on their value, as described in subheadings 9904.05.83 - 9904.05.94, HTSUSA. An import license, issued to the importer by the United States Department of Agriculture, will be required at the time such merchandise is entered for consumption into the United States. Questions regarding licensing procedures and applications for licenses to import cheese subject to quota should be addressed to: U.S. Department of Agriculture Foreign Agricultural Service Import Policies and Trade Analysis Division Attn.: Dairy Import Group, Rm. 5531, So. Bldg. Washington, DC 20250-1000 With regard to your observation that a store in New York City sells a Gouda style cheese that does not indicate a country of origin marking, be advised that articles of domestic origin are not subject to the country of origin marking requirements. The Gouda style cheese in question may be of domestic origin. Sincerely, John Durant, Director Tariff Classification Appeals Division