CLA-2-44:OT:RR:NC:N3:230
Ms. Linda Labrosse, CCS
Customs Certified Specialist
6568 Lavoie St.
Val-Morin, Québec J0T 2R0
CANADA
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of InsulFloor R3 boards
Dear Ms. Labrosse:
In your letter, dated July 15, 2016, you requested a tariff classification ruling on behalf of your client, InsulFloor, Inc. The request was returned to you for additional information, which was received by this office on September 2, 2016. The ruling request regards InsulFloor R3 boards. A sample and product information were submitted for our review and will be retained for reference.
The sample submitted consists of a 1/2”-thick layer of oriented strand board (OSB) laminated onto a 1/2"-thick layer of polystyrene foam that is grooved along its back. The imported boards measure approximately 15.5” wide by 47.5” long. The boards have tongue and groove shaping along their edges and ends for installation. The boards are installed as subfloors, with the OSB functioning as the subfloor, and the polystyrene functioning as insulation. When installed over concrete, the boards allow for higher floor temperatures.
Note 4 to Chapter 44, Harmonized Tariff Schedule of the United States (HTSUS), provides that “Products of heading 4410, 4411 or 4412 may be worked to form the shapes provided for in respect of the articles of heading 4409, …or submitted to any other operation provided it does not give them the character of articles of other headings.” The tongue and groove shaping and the addition of an insulating layer do not give the OSB the character of articles of another heading; the boards still function as OSB, and therefore remain classified in heading 4410, HTSUS.
The applicable subheading for the InsulFloor R3 boards will be 4410.12.0020, HTSUS, which provides for Particle board, oriented strand board (OSB) and similar board (for example, waferboard) of wood or other ligneous materials, whether or not agglomerated with resins or other organic binding substances: Of wood: Oriented strand board (OSB): Other. The rate of duty will be free.
You state in your letter that the OSB and polystyrene insulation board are both manufactured in Canada, while the adhesive is manufactured in Malaysia. The InsulFloor R3 boards are manufactured in Canada.
General Note 12, HTSUS, incorporates Article 401 of the NAFTA into the HTSUS. General Note 12(a)(i) provides, in pertinent part:
(a) Goods originating in the territory of a party to the North American Free Trade Agreement (NAFTA) are subject to duty as provided herein. For the purposes of this note--
(i) Goods that originate in the territory of a NAFTA party under the terms of subdivision (b) of this note and that qualify to be marked as goods of Canada under the terms of the marking rules set forth in regulations issued by the Secretary of the Treasury (without regard to whether the goods are marked), and goods enumerated in subdivision (u) 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 "CA" in parentheses, are eligible for such duty rate, in accordance with section 201 of the North American Free Trade Agreement Implementation Act.
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—
(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;
Subdivision (t) states that, in order to be subject to NAFTA, manufacturing must result in a change as follows: A change to headings 4401 through 4421 from any other heading, including another heading within that group. The OSB and polystyrene foam are Canadian in origin. Only the glue is non-originating. Because the non-originating glue is classifiable in heading 3506, HTSUS, and the final InsulFloor R3 panels are classifiable in heading 4410, HTSUS, the rule is met; the panels therefore qualify for NAFTA preferential treatment.
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 https://hts.usitc.gov/current.
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 Laurel Duvall at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division