OT:RR:CTF:TCM H023499 HvB
Mr. John M. Peterson
Neville Peterson LLP
17 State Street, 19th Floor
New York, NY 10004
RE: Originating Status under the North American Free Trade Agreement of Certain Petroleum Coke from Canada or Mexico
Dear Mr. Peterson:
This is in response to your letter, dated February 7, 2008, to U.S. Customs and Border Protection (“CBP”), on behalf of Capex Europe, Ltd., (“Capex”) in which you requested reconsideration of New York Ruling Letter (“NY”) N019971, which the National Commodity Specialist Division issued on December 20, 2007. In NY N019971, CBP determined that certain petroleum coke, to be imported into the United States, was non-originating and not eligible for preferential treatment under the North American Free Trade Agreement (“NAFTA”).
The NAFTA Rules of Origin concerning Chapter 27 were modified in August 2009. President Obama announced the incorporation of these amendments into the Harmonized Tariff Schedule of the United States (“HTSUS”) in Presidential Proclamation 8405, on August 31, 2009. These changes became effective for goods to be imported into the United States on October 2, 2009. As a result of these amendments, NY N019971 has been revoked by operation of law and, as a revoked ruling, cannot be reconsidered. However, we have accepted your request for reconsideration as a prospective ruling filed pursuant to 19 CFR 177.1, and herein provide you with a determination of the originating status of the petroleum coke under the current NAFTA rules of origin.
FACTS:
Capex intends to import petroleum coke from Canada or Mexico, that will be produced in a Canadian or Mexican refinery.
In your submission, you state:
First, NAFTA country refiners introduce crude petroleum, together with small quantities of refined petroleum products (vacuum gas oils or hydro cracker bottoms) into refineries located in a NAFTA country. In these refineries, the materials are subjected to various refining operations, including atmospheric distillation and vacuum distillation… The result of this processing is the manufacture of various hydrocarbon streams, including light gases (naphthas, VGOs, jet fuels), medium weight oils (gasoline and other motor fuels, diesel or heating oils) and heavy residual materials (residual oils, asphalt, etc.).
Second, heavy residual oils are produced in a NAFTA country refinery (classified under heading 2710, HTSUS) and are transferred to a facility known as a “delayed coker”. In this facility, the residual oils are subjected to further refining operations to yield various end-products, including the petroleum coke which is the subject of this request and is classified under heading 2713, HTSUS.
ISSUE:
What is the originating status under NAFTA of the petroleum coke?
LAW AND ANALYSIS:
We note that there is no dispute as to the classification of the residual oil, which is classified under heading 2710, HTSUS, which provides for petroleum oils and oils obtained from bituminous minerals, other than crude; preparations not elsewhere
specified or included, containing by weight 70 percent or more of petroleum oils or of oils obtained from bituminousminerals, these oils being the basic constituents of the
preparations; waste oils. We also affirm the classification of the end product, petroleum coke, which is classified under heading 2713, HTSUS, which provides for petroleum coke, petroleum bitumen and other residues of petroleum oils or of oils obtained from bituminous minerals.
General Note 12 of the HTSUS incorporates Article 401, North American Free Trade Agreement, as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057) (December 8, 1993), into the HTSUS.
To be eligible for tariff preferences under the NAFTA, goods must be “originating goods” pursuant to General Note 12(b) of the HTSUS, which provides 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 –
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 ...
General Note 12(t), which sets forth the change in tariff classification rules, provides, in relevant part:
Chapter 27, Note 4G
A change to subheadings 2713.11 through 2713.12 from any other heading.
As you represented in your request, heavy residual oils (classified in heading 2710, HTSUS) will be further refined in a delayed coker to yield, among other products, the petroleum coke in question (which you state will be classified in heading 2713, HTSUS). If the petroleum coke is classified in subheading 2713.11 (covering “Petroleum coke: Not calcined) or subheading 2713.11 (covering “Petroleum coke: Calcined), the merchandise will be originating and eligible for preferential treatment under NAFTA pursuant to GN 12(t)/Chapter 27, Rule 4G.
HOLDING:
Based on the information that you provided, the petroleum coke at issue will be originating and eligible for preferential treatment under NAFTA pursuant to GN 12(t)/Chapter 27, Rule 4G. We note that our determination is strictly limited to the facts presented.
A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Gail Hamill, Chief
Tariff Classification & Marking Branch
Commercial & Trade Facilitation Division