CLA-2-19:OT:RR:NC:N2:228
Mr. Jerome Schindler
Food Regulatory Consultant
395 S. Chesterfield Road
Columbus, OH 43209
RE: The tariff classification, marking, country of origin and status under the United States-Singapore Free Trade Agreement (SFTA) of dairy products from Singapore
Dear Mr. Schindler:
In your letter dated May 11, 2012, on behalf of Sun Hing Foods, Inc. Francisco, CA, you requested a tariff classification, marking, country of origin ruling, and status of dairy products from Singapore under the SFTA.
Ingredients breakdowns, a description of production steps and two artwork layouts of the product labels were submitted with your letter. Additional information was provided via an email transmission dated May 29, 2012. Dairy Girl brand Sweetened Condensed Filled Milk and Cow & Mill brand Sweetened Condensed Creamer are diary products, said to be in the form of a viscous liquid in a sealed metal can weighing 14 ounces (397 grams) and 13.8 ounces (390 grams), net weight, respectively. The two products can be used as a sandwich spread, sweetener for tea, coffee and other beverages, and used for making baked goods. Sweetened Condensed Filled Milk is composed of 44 percent sugar, 28 percent water, 20 percent nonfat dry milk, 8 percent palm oil, and a trace amount of vitamin A palmitate. Sweetened Condensed Creamer consists of 48 percent sugar, 27 percent water, 13.6 percent dried whey, 10 percent palm oil, 1.4 percent nonfat dry milk, and a trace amount of vitamin A palmitate.
The nonfat dry milk and dried whey will be products of the United States. The sugar and palm oil will be products of countries other than the United States or Singapore. The water will be obtained from Singapore. The vitamin A palmitate will be a product of Switzerland. In Singapore, all ingredients will be mixed to make the subject products, then packaged, labeled, and placed in shipping cartons.
The layout of the Dairy Girl brand Sweetened Condensed Filled Milk label is in three frames. The information on the label is in two languages juxtaposed side by side, or one on top the other. English is first then the foreign translation is next. Starting on the left of the first frame are the words “GOOD FOR RESTAURANTS AND BAKERS” written vertically. In the first frame are the Nutrition Facts. The middle frame contains the product name, the usage, an ingredients list, the words “Distributed By:” followed by the U.S. distributor’s logo, name, address and website, country of origin “PRODUCT OF SINGAPORE”, storage suggestions, a caution statement and a UPC bar code. The right frame contains the brand name “Dairy Girl” with a female image drinking from a cup in a pasture with a cow on each side of her in the background, and a zero “Trans Fat” declaration that occupies most of the frame. Below it are the product name and net weight information. On the right of the last frame are the words “BEST IF USED BY DATE SHOWN ON BOTTOM OF CAN” written vertically.
The layout of the Cow & Mill brand Sweetened Condensed Creamer label is in four frames. The information on the label is in English only. Starting on the left, the first and third frames are exactly the same containing the brand name “COW & MILL”, an image of two cows in front of two Dutch-style windmills, the product name and net weight information. The second frame contains the usage of the product, an ingredients list, the storage suggestions, a caution statement, the words “Distributed By:” followed by the U.S. distributor’s name, address and website, the country of origin “PRODUCT OF SINGAPORE”, and a UPC bar code. The fourth frame contains the “Nutrition Facts.” On the right of the last frame are the words “BEST IF USED BY DATE SHOWN ON TOP OF CAN” written vertically. On the both labels, the U.S. distributor’s address is printed using a smaller font than the “PRODUCT OF SINGAPORE” statement.
In your letter, you suggested both products should be classified in subheading 1901.90.4200 or 1901.90.4300, Harmonized Tariff Schedule of the United States (HTSUS), the in- and over-quota provisions for diary preparations containing over 10 percent by weight of milk solids described in additional U.S. note 10 to chapter 4. We agree with your proposed classification for Sweetened Condensed Filled Milk. Based on the ingredient composition of Sweetened Condensed Creamer, it must be classified elsewhere.
The applicable subheading for the sweetened condensed filled milk, if imported in quantities that fall within the limits described in additional U.S. note 10 to chapter 4, will be 1901.90.4200, HTSUS, which provides for food preparations of goods of headings 0401 to 0404, not containing cocoa … not elsewhere specified or included … other … other … dairy products described in additional U.S. note 1 to chapter 4 … dairy preparations containing over 10 percent by weight of milk solids… described in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. The rate of duty will be 16 percent ad valorem. If the quantitative limits of additional U.S. note 10 to chapter 4 have been reached, the product will be classified in subheading 1901.90.4300, HTSUS, and dutiable at the rate of $1.035 per kilogram plus 13.6 percent ad valorem.
The applicable subheading for the sweetened condensed creamer will be 1901.90.9095, HTSUS, which provides for food preparations of goods of headings 0401 to 0404, not containing cocoa … not elsewhere specified or included … other … other … other. The rate of duty will be 6.4 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 the World Wide Web at http://www.usitc.gov/tata/hts/.
General Note 25(b), HTSUS, sets forth the criteria for determining whether a good is originating under the SFTA. General Note 25(b), HTSUS, (19 U.S.C. § 1202) states, in pertinent part, that
For the purposes of this note, subject to the provisions of subdivisions (c), (d), (n) and (o) thereof, goods imported into the customs territory of the United States are eligible for treatment as originating goods of a SFTA country under the terms of this note only if they–
(i) were wholly obtained or produced entirely in the territory of Singapore or of the United States, or both;
(ii) are goods that, in their condition as imported, are enumerated in subdivision (m) of this note and imported from the territory of Singapore; or
(iii) have been transformed in the territory of Singapore or of the United States, or both, so that each nonoriginating material:
(A) undergoes an applicable change in tariff classification set out in subdivision (o) of this note as a result of production occurring entirely in the territory of Singapore or of the United States, or both; or
(B) if no change in tariff classification is required, the good otherwise satisfies the applicable requirements set forth in such subdivision (o).
Based on the facts provided, the two products described above qualify for SFTA preferential treatment because they will meet the requirements of HTSUS General Note 25(b)(iii)(A) and 25(o)/19.3. The sweetened condensed filled milk, when classified in subheading 1901.90.4200, HTSUS, will therefore be entitled to a free rate of duty under the SFTA upon compliance with all applicable laws, regulations, and agreements. When entered in subheading 1901.90.4300, if imported in quantities that fall within the limits described in U.S. note 7 to subchapter X of chapter 99, the sweeten condensed filled milk will be entitled to a free rate of duty pursuant to subheading 9910.04.50, HTSUS, upon compliance with all applicable laws, regulations, and agreements. If the quantitative limits of U.S. note 7 to subchapter X of chapter 99 have been reached, it will be dutiable at the rate of 10.3 cents per kilogram plus 1.3 percent ad valorem in subheading 9910.04.70, HTSUS, upon compliance with all applicable laws, regulations, and agreements. The sweetened condensed creamer will be entitled to a free rate of duty under the SFTA 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, U.S. Customs and Border Protection Regulations (19 C.F.R. §134) implements the country of origin marking requirements and exceptions of 19 U.S.C. §1304.
Part 134.1(b) of the regulations (19 C.F.R. § 134.1(b)), defines "country of origin" as:
[T]he country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the “country of origin” within the meaning of this Part…
A substantial transformation occurs when an article emerges from a process with a new name, character or use different from that possessed by the article prior to processing. United States v. Gibson-Thomsen Co., Inc., 27 CCPA 267, C.A.D. 98 (1940); National Hand Tool Corp. v. United States, 16 CIT 308 (1992), aff’d, 989 F. 2d 1201 (Fed. Cir. 1993). However, if the manufacturing or combining process is merely a minor one that leaves the identity of the article intact, a substantial transformation has not occurred. Uniroyal, Inc. v. United States, 3 CIT 220, 542 F. Supp. 1026, 1029 (1982), aff’d, 702 F.2d 1022 (Fed. Cir. 1983).
In this case, the mixture of pre-formulated ingredients to create the finished products results in a substantial transformation. The ingredients lost their separate identities and became an integral part of a new product. The country of origin of the sweetened condensed filled milk and sweetened condensed creamer is Singapore.
As provided in section 134.41(b), Customs Regulations (19 CFR 134.41(b)), the country of origin marking is considered conspicuous if the ultimate purchaser in the U.S. is able to find the marking easily and read it without strain.
With regard to the permanency of a marking, section 134.41(a), Customs Regulations (19 CFR 134.41(a)), provides that as a general rule marking requirements are best met by marking worked into the article at the time of manufacture. For example, it is suggested that the country of origin on metal articles be die sunk, molded in, or etched. However, section 134.44, Customs Regulations (19 CFR 134.44), generally provides that any marking that is sufficiently permanent so that it will remain on the article until it reaches the ultimate purchaser unless deliberately removed is acceptable.
Section 134.46, Customs Regulations (19 CFR 134.46), requires that in any case in which the words “United States,” or “American,” the letters “U.S.A.,” any variation of such words or letters, or the name of any city or location in the United States, or the name of any foreign country or locality other than the country or locality in which the article was manufactured or produced appear on an imported article or its container, and those words, letters or names may mislead or deceive the ultimate purchaser as to the actual country of origin of the article, there shall appear legibly and permanently in close proximity to such words, letters or name, and in at least a comparable size, the name of the country of origin preceded by “Made in,” “ Product of,” or other words of similar meaning. In order to satisfy the close proximity requirement, the country of origin marking must generally appear on the same side(s) or surface(s) in which the name or locality or other than the actual country of origin appears.
The proposed marking of the sweetened condensed filled milk and sweetened condensed creamer, as described above, is conspicuously, legibly, indelibly and permanently marked in satisfaction of the marking requirements of 19 U.S.C. 1304 and 19 CFR Part 134 and is an acceptable country of origin marking for the imported sweetened condensed filled milk and sweetened condensed creamer.
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 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 Bruce N. Hadley, Jr. at (646) 733-3029.
Sincerely,
Thomas J. Russo
Director
National Commodity Specialist Division