CLA-2-64:OT:RR:NC:N3:447
Kenneth M. Carmon
Bay Brokerage, Inc.
44951 County Route 191
P.O. Box 293
Wellesley Island, NY 13640
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of overshoes from Canada; Article 509
Dear Mr. Carmon:
In your letters dated March 3, 2014, and May 29, 2014, you requested a ruling on the status of overshoes from Canada under the NAFTA.
Descriptive literature and cost information were submitted with your first letter. A sample and country of origin information accompanied your second letter. The product, Wilkuro brand Safety Toes, are below-the-ankle, galoshes-type, PVC overshoes with steel toe caps. Available in color coded sizes to fit over most shoes, they are said to protect the wearer’s toes from compression as well as providing slip-resistance. They are not considered “protective,” as described in T.D. 93-88, for tariff purposes. They measure 1-1/2 inches tall at the lowest point and do not cover the top of the foot, excepting the toes. In Canada, the steel toe caps from China are incorporated into the PVC components, sourced from Mexico, using adhesives.
The applicable tariff provision for the Wilkuro brand Safety Toes overshoes will be 6401.10.1000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for waterproof footwear with outer soles and uppers of rubber or plastics, the uppers of which are neither fixed to the sole not assembled by stitching, riveting, nailing, screwing, plugging or similar processes: footwear incorporating a protective metal toe-cap. The general rate of duty will be 37.5 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, or
(B) the goods otherwise satisfy the applicable requirements of subdivisions (r), (s) and (t) where no change in tariff classification is required, and the goods satisfy all other requirements of this note; or
(iii) they are goods produced entirely in the territory of Canada, Mexico and/or the United States exclusively from originating materials; or
(iv) they are produced entirely in the territory of Canada, Mexico and/or the United States but one or more of the nonoriginating materials falling under provisions for “parts” and used in the production of such goods does not undergo a change in tariff classification because--
(A) the goods were imported into the territory of Canada, Mexico and/or the United States in unassembled or disassembled form but were classified as assembled goods pursuant to general rule of interpretation 2(a), or
(B) the tariff headings for such goods provide for and specifically describe both the goods themselves and their parts and is not further divided into subheadings, or the subheadings for such goods provide for and specifically describe both the goods themselves and their parts,
provided that such goods do not fall under chapters 61 through 63, inclusive, of the tariff schedule, and provided further that the regional value content of such goods, determined in accordance with subdivision (c) of this note, is not less than 60 percent where the transaction value method is used, or is not less than 50 percent where the net cost method is used, and such goods satisfy all other applicable provisions of this note.
General Note 12(t)/64.1 provides for a change to headings 6401 through 6405 from any heading outside that group, except from subheading 6406.10, provided there is a regional value content of not less than 55 percent under the net cost method.
If imported separately, the steel toe caps would be classified in 6406.10.9090, HTSUS, the provision for parts of footwear uppers. Cost information submitted with your letter shows the non-originating toe caps comprise less than 15 percent of the total cost. Additionally, in your letter you state that the value of the non-originating material, the metal toe caps from China, comprise less than 7 percent of the transaction value of the completed shoe.
Based on the facts provided, the goods described above qualify for NAFTA preferential treatment, because the non-originating material used to make the footwear has satisfied the changes in tariff classification required and will meet the requirements of HTSUS General Note 12(b)(ii)(A) and General Note 12(t)/64.1. 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 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 Stacey Kalkines at [email protected].
Sincerely,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division