OT:RR:CTF:VS H342359 AM
PJ Trainham
Bay Brokerage Inc.
42832 NYS Route 12
Alexandria Bay, NY 13607
RE: Ingots; United States-Mexico-Canada Agreement
Dear Mr. Trainham:
This is in response to your request, dated October 9, 2024, filed on behalf of Heneken
Group (“Heneken”) in which you request a binding ruling regarding the eligibility of certain
ingots for preferential tariff treatment under the United States-Mexico-Canada Agreement
(“USMCA”). Our ruling is set forth below.
FACTS:
ZD Metal located in Petoskey, Michigan is a producer of die-cast magnesium parts for
the automotive industry. In your ruling request, you state that the raw materials for the parts are
magnesium alloy ingots, classified under subheading 8104.19, Harmonized Tariff Schedule of
the United States (“HTSUS”), which provides for: “Magnesium and articles thereof, including
waste and scrap: Other.” These raw material ingots are purchased from Heneken Magnesium
Technology in Quebec, Canada, and from an additional supplier, MagPro LLC, located in
Camden, Tennessee.
The die-casting process, taking place in ZD Metal’s production plant in Michigan,
consists of (1) remelting the incoming magnesium alloy ingots, and (2) injecting the liquid
magnesium into model producing parts. This process generates approximately 50% scrap. You
state that the magnesium scrap is classified under subheading 8104.20, HTSUS, which provides
for: “Magnesium and articles thereof, including waste and scrap: Waste and scrap.” A portion of
the scrap is recycled by MagPro LLC, and the other portion is sent to Heneken in Canada. In
Canada,
Heneken remelts the magnesium scrap and adds beryllium metal purchased from a U.S.
distributor, and stated to be originating, to create ingots. The recycled ingots are shipped to ZD
Metal in the United States to continue and repeat the production cycle.
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ISSUE:
Whether the subject ingots are eligible for preferential tariff treatment under the USMCA
when imported from Canada into the United States.
LAW & ANALYSIS:
The USMCA was signed by the Governments of the United States, Mexico, and Canada
on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on
January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19
U.S.C. 4511(a)). General Note (“GN”) 11 of the HTSUS implements the USMCA.
GN 11(a)(i) provides:
Goods that originate in the territory of Mexico, Canada or the United States
(hereinafter referred to as “USMCA country” or “USMCA countries” as further
defined in subdivision (l)(xxiv) of this note) under the terms of subdivision (b) of
this note and regulations issued by the Secretary of the Treasury (including
Uniform Regulations provided for in the USMCA), and goods enumerated in
subdivision (p) of this note, when such goods are imported into the customs
territory of the United States and are entered under a subheading for which a rate
of duty appears in the “Special” subcolumn, followed by the symbol “S” in
parentheses, are eligible for such duty rate, in accordance with section 202 of the
United States-Mexico-Canada Agreement Implementation Act; and . . .
GN 11(b) sets forth the criteria for determining whether a good is an originating good for
purposes of the USMCA. GN 11(b) states:
For the purposes of this note, a good imported into the customs territory of the United
States from the territory of a USMCA country, as defined in subdivision (l) of this note,
is eligible for the preferential tariff treatment provided for in the applicable subheading
and quantitative limitations set forth in the tariff schedule as a “good originating in the
territory of a USMCA country” only if—
(i) the good is a good wholly obtained or produced entirely in the territory of
one or more USMCA countries;
(ii) the good is a good produced entirely in the territory of one or more
USMCA countries, exclusively from originating materials;
(iii) the good is a good produced entirely in the territory of one or more
USMCA countries using nonoriginating materials, if the good satisfies all
applicable requirements set forth in this note (including the provisions of
subdivision (o)); or
…
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GN 11(l) provides that the term “good wholly obtained or produced entirely in the territory
of one or more USMCA countries” means any of the following:
(10) waste and scrap derived from—
(A) production in the territory of one or more USMCA countries; or
(B) used goods collected in the territory of one or more USMCA countries, if
such goods are fit only for the recovery of raw materials.
Here, in its production process of parts in the United States, ZD Metal melts ingots which
create 50% scrap that is then sent to Canada and remelted. As such, the created scrap may be
considered originating “wholly obtained or produced materials.” Further, it is stated that originating
beryllium metal is added to the scrap to create the recycled ingots. Therefore, the subject ingots
qualify as USMCA originating goods and will be eligible for preferential tariff treatment under the
USMCA when imported into the United States from Canada.
HOLDING:
Based on the information provided, the subject ingots are eligible for preferential tariff
treatment under USMCA.
Please note that 19 CFR 177.9(b)(1) provides that “[e]ach ruling letter is issued on the
assumption that all of the information furnished in connection with the ruling request and
incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and
complete in every material respect. The application of a ruling letter by [CBP] field office to the
transaction to which it is purported to relate is subject to the verification of the facts incorporated
in the ruling letter, a comparison of the transaction described therein to the actual transaction,
and the satisfaction of any conditions on which the ruling was based.”
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,
Monika R. Brenner, Chief
Valuation and Special Programs Branch
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