The tariff classification, country of origin marking, and status under the North American Free Trade Agreement (NAFTA), of sugar and milk blends from Mexico; Article 509

N103201 May 6, 2010 CLA-2-21:OT:RR:NC:2:228 CATEGORY: Classification TARIFF NO.: 2106.90.9400 Mr. Robert V. Tinkham Rafi Industries 1700 Higgins Road, Suite 610 Des Plaines, IL 60018 RE: The tariff classification, country of origin marking, and status under the North American Free Trade Agreement (NAFTA), of sugar and milk blends from Mexico; Article 509 Dear Mr. Tinkham: In your letter dated April 1, 2010, received by this office on April 27, 2010, you requested a ruling on the status of sugar and milk blends from Mexico under the NAFTA. Two unmarked samples accompanied your request and were examined and disposed of. Product A consists of ninety (90) percent refined sugar and ten (10) percent non-fat dry milk. Product B consists of ninety-five (95) percent refined sugar and five (5) percent non-fat dry milk. Both products will be imported in a variety of sizes ranging from 50-pound bags to 3000-pound totes. The products will be used as ingredients in the manufacture of bakery, confectionery, and beverage products. The sugar in the blends will be grown and refined in either the United States or Mexico, and the non-fat dry milk will be a product of either the United States or Canada. The blending will take place in Mexico. The applicable tariff provision for Products A and B will be 2106.90.9400, Harmonized Tariff Schedule of the United States (HTSUS), which provides for food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Articles containing over 65 percent by dry weight of sugar described in additional U.S. note 2 to chapter 17: Other. The general rate of duty will be 28.8 cents per kilogram plus 8.5 percent ad valorem. 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/. 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… Based on the facts provided, the goods described above qualify for NAFTA preferential treatment because they meet the requirements of HTSUS General Note 12(b)(i). The goods 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 134.45(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.” 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. Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we find that in the case where the sugar and milk blends contain sugar of United States origin, the imported sugar and milk blends are goods of the United States for marking purposes. Where the sugar and milk blends contain sugar of Mexican origin, the imported sugar and milk blends are goods of Mexico for marking purposes. If a good is determined to be an article of U.S. origin, it is not subject to the country of origin marking requirements of 19 U.S.C. §1304. Whether an article may be marked with the phrase “Made in the USA” or similar words denoting U.S. origin, is an issue under the authority of the Federal Trade Commission (FTC). We suggest that you contact the FTC Division of Enforcement, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580 on the propriety of proposed markings indicating that an article is made in the U.S. This merchandise is subject to The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act), which is regulated by the Food and Drug Administration (FDA). Information on the Bioterrorism Act can be obtained by calling FDA at 301-575-0156, or at the Web site www.fda.gov/oc/bioterrorism/bioact.html. 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 Stanley Hopard at (646) 733-3029. Sincerely, Robert B. Swierupski Director National Commodity Specialist Division