CLA-2-83:OT:RR:NC:N1:121
Mr. Peter T. Devlin
Ryerson International Procurement
227 West Monroe Street, 27th Floor
Chicago, IL 60606
RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of unfinished hinge parts from Canada; Article 509
Dear Mr. Devlin:
In your letter dated June 26, 2012, you requested a ruling on the classification and status of an unfinished article from Canada under the NAFTA. The article under consideration is an unfinished steel part for a hinge used on a vessel.
Rectangular plates of ASTM A36 carbon steel, measuring 6 inches thick by 81 inches wide by 266 inches long, are shipped from China or India into Canada. At your facility in Canada, utilizing computer assisted precision torches, each plate is torch burned, yielding six identically shaped articles. Once the burning is complete, the resultant articles are shipped from Canada to your plant in the U.S. without further processing. The burned articles are produced precisely to the U.S. customer’s specifications and are dedicated for use at the time of export to the U.S. Once in the U.S., each article is finished at your facility by burning a 13-inch hole through it and by drilling and tapping a second hole into it. The first hole will accommodate a rotating shaft; the second hole will accommodate a Zerk grease fitting.
The finished article will be installed by the U.S. customer into the deck hinge assembly of an open hopper barge, a vessel with an open top used to transport and dump rubbish in the water. The rubbish is ejected from the barge by opening the bottom of the hopper. A hydraulic mechanism controls the opening/closing of the hopper by rotating a shaft that runs along the centerline of the barge and the length of the hopper. Two deck hinge assemblies are mounted to the deck; one located at each end of the hopper. Each deck hinge assembly includes a “hinge leaf,” which supports the shaft and enables it to rotate. Each “hinge leaf” is made up of seven pieces of the instant article welded together in an alternating pattern with the burned out holes aligned to accommodate the shaft.
Classification of merchandise under the Harmonized Tariff Schedule of the United States (HTSUS) is governed in accordance with the General Rules of Interpretation (GRI’s). GRI 2(a) states that “Any reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or failing to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled.” By application of GRI 2 (a), the unfinished hinge part has the essential character of a finished hinge part because it is of the same shape and outline of the finished part and can only be used for completion into the finished part.
The applicable tariff provision for the steel unfinished hinge part will be 8302.10.6090, HTSUS, which provides for base metal mountings, fittings and similar articles suitable for furniture, doors, staircases, windows, blinds, coachwork…hinges, and parts thereof, of iron or steel, of aluminum or of zinc, other, other. The rate of duty will be 3.5 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.
Based on the facts provided, the unfinished hinge part described above qualifies for NAFTA preferential treatment, because it will meet the requirements of HTSUS General Note 12(b)(ii)(A). The good 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 Barbara Kaiser at (646) 733-3024.
Sincerely,
Thomas J. Russo
Director
National Commodity Specialist Division