Ms. Ruth N. Girmschedi
International Customs Services, Inc.
N64 W24801 Main Street, Suite 121
Sussex, WI 53089
RE: THE COUNTRY OF ORIGIN UNDER THE NORTH AMERICAN FREE TRADE AGREEMENT OF DEFECTIVE BATTERIES; ARTICLE 509
Dear Ms. Girmschedi:
In your letter dated February 13, 2009, you requested the NAFTA status of defective batteries imported into the United States.
In your ruling request you state that the defective batteries will be removed from vehicles in Canada. Upon importation into the United States, the batteries will not be capable of providing power and cannot be repaired or resold. After importation into the United States, the batteries will be broken down to recycle their lead and plastic. The recycled materials will then be used in the manufacture of new batteries in the United States and Mexico.
You state in your ruling request that the defective batteries that you intend to import are manufactured in various countries but are primarily manufactured in the United States and Mexico. The vehicles that the batteries were removed from were manufactured in various countries, but are primarily manufactured in the United States and Mexico. Each shipment of defective batteries is then accompanied by a return battery report which provides information on the individual batteries. This office has requested the value of the defective batteries, but you responded that value of the batteries was not provided.
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 CFR 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.
You have stated that the defective batteries that you intend to import are manufactured in the U.S., Mexico, and various countries. Since the U.S. and Mexico are defined under 19 CFR 134.1(g), as a NAFTA countries, we must first apply the NAFTA Marking Rules in order to determine whether the imported articles are a "good of a NAFTA country", and thus subject to the NAFTA marking requirements.
Part 102 of the regulations, sets forth the "NAFTA Marking Rules" for purposes of determining whether a good is a good of a NAFTA country for marking purposes. Section 102.11 of the regulations, sets forth the required hierarchy for determining country of origin for marking purposes.
Applying the NAFTA Marking Rules set forth in Part 102 of the regulations to the facts of this case, we note that the applicable tariff provision for the defective batteries will be 8548.10.1500, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Spent primary cells, spent primary batteries and spent electric storage batteries: Other.” We find that the imported defective batteries which were manufactured in the U.S. and Mexico are goods of a NAFTA country, i.e. the U.S. and Mexico, for marking purposes because they meet the tariff shift requirement set out in Part 102 of the regulations, which states: “a change to heading 8548 from any other heading.” As such, the imported defective batteries that were manufactured in the U.S. and Mexico can be marked to indicate either the U.S. or Mexico as the country of origin, respective of the country that each defective battery was manufactured in. As you have stated in your submission, you also intend to import defective batteries that were manufactured in various countries, other than the U.S. and Mexico. Those defective batteries that were not manufactured in a NAFTA country as described in 19 CFR 134.1(g), those being the U.S., Mexico, and Canada, are not goods of a NAFTA country and cannot be marked with the country of origin as being the U.S., Mexico, or Canada. Therefore, in accordance with the marking statute, section 304, Tariff Act of 1930, as amended (19 U.S.C. 1304), the defective batteries that are manufactured in a country other than the U.S., Mexico, or Canada must indicate the name of their respective country of origin. Part 134, Customs Regulations (19 CFR Part 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.
This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR Part 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 Linda Hackett at (646) 733-3015.
Robert B. Swierupski
National Commodity Specialist Division