The country of origin of ethylcellulose from China.

N097515 March 17, 2010 CLA-2-39:OT:RR:NC:N2:237 CATEGORY: Country of Origin Ms. Judith Kay McCray Regulatory Compliance Specialist Ashland, Inc. 5200 Blazer Parkway Dublin, Ohio 43017 RE: The country of origin of ethylcellulose from China. Dear Ms. McCray: In your letter dated March 15, 2010 you requested a country of origin ruling for ethylcellulose. You have provided physical and chemical properties sheets for our review. Ashland has a plant in China that manufactures ethylcellulose. Ashland also has a plant in the United States that manufactures ethylcellulose. Ashland plans to import ethylcellulose in bulk quantities from China. The ethylcellulose imported from China will be commingled with ethylcellulose manufactured by Ashland in the United States. You request the country of origin, if Ashland in the United States provides 51% or higher content of ethylcellulose in bulk versus 49% of Chinese ethylcellulose in bulk. Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that, unless excepted, every article of foreign origin imported into the United States shall be marked in a conspicuous location place as legibly, indelibly, and permanently as the nature of the article (or container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States 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. Section 134.1(b), Customs Regulations (19 CFR 134.1(b)), states that the country of origin of an article is the country in which it was manufactured, produced, or grown, unless thereafter the article is subjected to processing in another country which results in a substantial transformation. A substantial transformation is said to occur when, within the principle of the case of United States v. GibsonThomsen Co. Inc., 227 C.C.P.A. 267 (C.A.D.)(1940), an article is processed such that it acquires a new name, character, or use. In this case, the issue presented is whether the ethylcellulose imported into the United States from China is substantially transformed in the United States by mixing the ethylcellulose imported from China with ethylcellulose manufactured by Ashland in the United States. In regard to whether this process results in a substantial transformation, we note the decision in National Juice Products v. United States, 628 F. Supp. 978, 10 CIT 48 (1986), a country of origin marking case. The U.S. Court of International Trade determined in that case that imported frozen concentrated orange juice was not substantially transformed in the United States when it was domestically processed into retail orange juice products. The U.S. processing involved mixing the imported concentrate with other batches of concentrate, either foreign or domestic, water, orange essences, orange oil, and, in some cases, fresh juice. The court agreed with Customs that the domestic processing did not produce an article with a new name, character or use because the essential character of the final product was imparted by the imported orange juice concentrate. The court stated: [T]he retail product in this case is essentially the juice concentrate derived in substantial part from foreign grown, harvested and processed oranges. The addition of water, orange essences and oils to the concentrate, while making it suitable for retail sale does not change the fundamental character of the product; it is still essentially the product of the juice of oranges. National Juice, 10 CIT at 61. The court further stated that “the imported product is the very essence of the retail product.” HRL 559965 dated January 24, 1997, concerned whether Canadian-origin peanut slurry is substantially transformed in the U.S. when it is processed into finished peanut butter. The processing involved mixing the imported slurry with U.S.-made peanut slurry as well as additional ingredients, including salt, sweeteners (dextrose and sucrose), peanut oil, and stabilizers (a blend of rapeseed, cottonseed and soybean oils) and, in certain instances, specialty flavorings. The resulting product was then subjected to milling, heating, degassing and cooling.Customs held in HRL 559965 that the blending together of the U.S. and Canadian peanut slurry along with certain other ingredients does not effect a substantial transformation of the slurry as the essential character of the finished peanut butter is imparted by the peanut slurry. We further stated: The further milling of the peanut slurry, heating, cooling, and the addition of various ingredients (salts, sweeteners, peanut oil, and stabilizers) which counsel has indicated affect the taste and consistency of the peanut butter do not change the very essence of the product. The imported slurry is essentially peanut butter, but in a less refined state than the creamy and highly processed products available under well known trade names.Consistent with the decisions in National Juice and HRL 559965, we find in this case that the mixing of ethylcellulose imported from China with ethylcellulose manufactured in the United States does not result in a substantial transformation of the ethylcellulose. With respect to a change in name, the ethylcellulose before the mixing process is referred to as ethylcellulose. After the mixing process, the product is still referred to as ethylcellulose. In regard to a change in character, the ethylcellulose after the mixing process retains the essential character of the ethylcellulose before the mixing process. The essence of the ethylcellulose is imparted by the constituent ethylcellulose polymer itself whose chemical structure is not altered by the mixing operation. With respect to a change in use, the many potential uses of the ethylcellulose are primarily predetermined by the properties and chemical composition of the ethylcellulose polymer.Based on the foregoing, it is our opinion that the country of origin of the ethylcellulose imported from China and commingled with ethylcellulose manufactured in the United States will be China.This merchandise may be subject to the requirements of the Toxic Substances Control Act (TSCA), which are administered by the U. S. Environmental Protection Agency. Information on the TSCA can be obtained by contacting the EPA at 1200 Pennsylvania Avenue, N.W., Washington, D.C. 20460, by calling the TSCA Assistance Line at (202) 554-1404, by Fax at (202) 554-5603, by e-mail to: tsca-hotline@epa.gov or by visiting their website at www.epa.gov. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). 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 Frank Cantone at (646) 733-3038. Sincerely, Robert B. Swierupski Director National Commodity Specialist Division