Mr. Mike Leahy
A.N. Deringer, Inc.
173 W. Service Road
Champlain, NY 12919
RE: The tariff classification, marking and status under the North American Free Trade Agreement (NAFTA), of barrettes from Canada; Article 509
Dear Mr. Leahy:
In your letter dated November 2, 1999, on behalf of Felicia’s Friends, you requested a ruling on the status of barrettes from Canada under the NAFTA. You inquire as to the tariff classification, NAFTA eligibility and the country of origin marking of this product.
The subject merchandise consists of barrettes that are made in Canada from Canadian materials with the exception of the metal spring hinge clips that are made in and imported from France. The barrettes, which are made from recycled wood, are assembled, painted, and varnished in Canada. You indicate that the cost of the metal clips represents 1.25% to 2.5% of the selling price and is therefore de minimis. Samples of the assembled hair barrette and unassembled hair barrettes were submitted with your request. The samples are stored inside of a cardboard gift box.
The applicable tariff provision for the barrettes will be 9615.19.6000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for combs, hair-slides and the like: other: other. The general rate of duty will be 11% ad valorem.
Both the non-originating metal clips and the barrettes are classified under subheading 9615.19.6000, HTSUS. The rule applicable to goods of subheading 9615.19, HTSUS, is found in General Note 12(t)/96.15, HTSUS, which provides for the following:
(A) A change to subheadings 9615.11 through 9615.19 from any other chapter, or
(B) A change to subheadings 9615.11 through 9615.19 from subheading 9615.90…
Although there is no tariff shift regarding the French metal clip, noting that its value is only 1.25% to 2.5% of the transaction value of the barrette, it will be considered de minimis as per General Note 12 (f)(i) which states in part:
(f) De minimis.
(i) Except as provided in subdivisions (f)(iii) through (vi), inclusive, a good shall be considered to be an originating good if the value of all non-originating materials used in the production of the good that do not undergo an applicable change in tariff classification set out in subdivision (t) of this note is not more than 7 percent of the transaction value of the good, adjusted to a F.O.B. basis...
The merchandise qualifies as originating goods and will therefore be free of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.
Country of Origin Marking
The submitted sample is marked as follows:
· The metal clips are stamped on the underside “Made in France.”
· The gift box is not marked with country of origin, however, stickers depicting the Canadian maple leaf have been affixed to it.
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, Customs Regulations (19 C.F.R. Part 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. §1304.
The country of origin marking requirements for a "good of a NAFTA country" are also determined in accordance with Annex 311 of the North American Free Trade Agreement ("NAFTA"), as implemented by section 207 of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat 2057) (December 8, 1993) and the appropriate Customs Regulations. The Marking Rules used for determining whether a good is a good of a NAFTA country are contained in Part 102, Customs Regulations. The marking requirements of these goods are set forth in Part 134, Customs Regulations.
Section 134.1(b) of the regulations, defines "country of origin" as the country of manufacture, production, or growth of any article of foreign origin entering the U.S. 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 this part; however, for a good of a NAFTA country, the NAFTA Marking Rules will determine the country of origin. (Emphasis added).
Section 134.1(j) of the regulations, provides that the "NAFTA Marking Rules" are the rules promulgated for purposes of determining whether a good is a good of a NAFTA country. Section 134.1(g) of the regulations, defines a "good of a NAFTA country" as an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules. Section 134.45(a)(2) of the regulations, provides that a "good of a NAFTA country" may be marked with the name of the country of origin in English, French or Spanish.
Since "Canada" is defined under 19 C.F.R. §134.1(g), as a NAFTA country, we must first apply the NAFTA Marking Rules in order to determine whether the imported barrette is a “good of a NAFTA country", and thus subject to the NAFTA marking requirements.
Part 102 of the regulations (19 C.F.R. Part 102), sets forth the “NAFTA Marking Rules” for purposes of determining whether a good is a good of a NAFTA country. Section 102.11 of the regulations (19 C.F.R. §102.11) sets forth the required hierarchy for determining country of origin for marking purposes. Section 102.11(a) provides that “[t]he country of origin of a good is the country in which:
1. The good is wholly obtained or produced;
2. The good is produced exclusively from domestic materials; or
3. Each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in section 102.20 and satisfies any other applicable requirements of that section, and all other requirements of these rules are satisfied.”
“Foreign Material” is defined in section 102.1(e) of the regulations as “a material whose country of origin as determined under these rules is not the same country as the country in which the good is produced.”
Pursuant to 19 C.F.R. §102.13, the French-origin metal clips used to make the barrettes will be disregarded for country of origin marking purposes as the value of the metal clips is no more than 7 percent of the appraised value of the imported good. Under these circumstances, the country of origin of the imported article as determined under 19 C.F.R. §102.11(a)(3) will be Canada, the country of origin of the barrettes.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).
This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.
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 Lawrence Mushinske at 212-637-7061.
Robert B. Swierupski