The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a food product from Mexico; Article 509

N116515 August 5, 2010 CLA-2-21:OT:RR:NC:2:228 CATEGORY: Classification TARIFF NO.: 2106.90.9700 Mr. Timothy Krellwitz Rafi Industries 1700 Higgins Road, Suite 610 Des Plaines, IL 60018 RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a food product from Mexico; Article 509 Dear Mr. Krellwitz: In your letters dated June 15, 2010, and July 16, 2010, you requested a ruling on the status of a food product from Mexico under the NAFTA. A product description, breakdown of ingredients, and a sample accompanied your first letter. Additional information accompanied your second letter. The sample was examined and disposed of. “BSM” is a white powder stated to be composed of 45 percent sugar, 30 percent coconut creamer (45 percent corn solids, 44 percent coconut oil, and 2 percent or less of sodium caseinate, dipotassium phosphate, sodium tripolyphosphate, monoglycerides, diacetyl tartaric acid ester of mono- and di-glycerides, sodium silicoaluminate, natural flavor), 13.7 percent maltodextrin, 10 percent non-fat dry milk, and less than 1 percent each of cellulose gum, free flow agent, and salt. The product will be imported in 2-pound pouches and used in beverage vending machines. The sugar, coconut creamer, maltodextrin, free-flow agent, and salt ingredients are products of either Mexico or the United States; the non-fat dry milk is a product of the United States; and the cellulose gum is from an unidentified, non-NAFTA country. The ingredients are shipped into Mexico where they are combined to form the mixture. The applicable tariff provision for the BSM will be 2106.90.9700, Harmonized Tariff Schedule of the United States (HTSUS), which provides for food preparations not elsewhere specified or included…other…articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 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 will meet the requirements of HTSUS General Note 12(b)(ii)(A) and 12(t)/21.14. The goods will therefore be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements. 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 telephone number (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