CLA-2-19:OT:RR:NC:N5:232
Ms. Sheri Lawson
Willson International Inc
160 Wales Ave.
Tonawanda, NY 14150
RE: The tariff classification, country of origin, marking, and eligibility under the United States-Mexico-Canada Agreement (USMCA) for Apple Strawberry Oat & Almond Cereal
Dear Ms. Lawson:
In your letter dated February 6, 2024, you requested a ruling on the tariff classification, country of origin, marking, and eligibility under the USMCA of Apple Strawberry Oat & Almond Cereal on behalf of your client, InnoFoods Inc. (Langley, British Columbia, Canada).
An ingredients breakdown and description, and representative image of the product box, accompanied your inquiry.
The subject merchandise is described as Apple Strawberry Oat & Almond Cereal with no added sugar, sweetened with fruit, and gluten free. The ingredients are said to be by weight 13 percent oats (Canada), 13 percent coconut chiplets (Sri Lanka), 13 percent sunflower seeds (China), 13 percent inulin (Mexico), 13 percent cereal flakes (United States), 11 percent almonds (United States), 6 percent date paste (United States), 4 percent pumpkin seeds (China), 3 percent coconut oil (Sri Lanka), 3 percent coconut butter (Sri Lanka), 3 percent dried strawberries (China or Egypt), 3 percent dried apples (Canada), and less than 1 percent each cinnamon powder (Vietnam), sea salt (United States), apple cinnamon flavor (United States), and natural booster (United States).
Classification:
The applicable subheading for the product is 1904.10.0080, Harmonized Tariff Schedule of the United States (HTSUS), which provides for: Prepared foods obtained by the swelling or roasting of cereals or cereal products other. The general rate of duty will be 1.1 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 at https://hts.usitc.gov/current.
Country of Origin and Marking:
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.
The country of origin is defined in 19 C.F.R. 134.1(b) as the country of manufacture, production, or growth of any article of foreign origin entering the United States. 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 the meaning of this part; however, for a good of a NAFTA or USMCA country, the marking rules set forth in part 102 of this chapter (hereinafter referred to as the part 102 Rules) will determine the country of origin.
Pursuant to section 102.0, interim regulations, related to the marking rules, tariff-rate quotas, and other USMCA provisions, published in the Federal Register on July 6, 2021 (86 FR 35566), the rules set forth in 102.1 through 102.18 and 102.20 determine the country of origin for marking purposes with respect to goods imported from Canada and Mexico. Section 102.11 provides a required hierarchy for determining the country of origin of a good for marking purposes, with the exception of textile goods which are subject to the provisions of 19 C.F.R. 102.21. See 19 C.F.R. 102.11.
Applied in sequential order, 19 C.F.R. Part 102.11(a) provides that the 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 Part 102.20 and satisfies any other applicable requirements of that section, and all other applicable requirements of these rules are satisfied.
The subject merchandise is neither wholly obtained or produced nor produced exclusively from domestic materials. Therefore, Sections 102.11(a)(1) and (a)(2) do not apply to the facts presented in this case. Because the analysis of sections 102.11(a)(1) and 102.11(a)(2) does not yield a country of origin determination, we next look to section 102.11(a)(3). The subject merchandise is classified under subheading 1904.10.0080, HTSUS. The applicable tariff shift requirement in Part 102.20 for subject merchandise of subheading 1904.10, HTSUS states: A change to subheading 1904.10 from any other heading.
The Apple Strawberry Oat & Almond Cereal is said to contain the following non-originating ingredients that need to undergo the tariff shift: coconut chiplets, sunflower seeds, pumpkin seeds, coconut oil, coconut butter, dried strawberries, and cinnamon powder. Since the non-originating ingredients are all classified in headings other than heading 1904, the tariff shift rule is met. Therefore, in accordance with 19 C.F.R. 102.11(a)(3), the country of origin of the cereal for marking purposes is Canada.
USMCA:
The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020 of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. 4511(a)). General Note (GN) 11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good is an originating good for purposes of the USMCA. GN 11(b) states the following:
For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a good originating in the territory of a USMCA country only if
(i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries;
(ii) the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials;
(iii) the good is a good produced entirely in the territory of one or more USMCA countries using non-originating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o));
Since the cereal contains non-originating ingredients, it is not considered a good wholly obtained or produced entirely in a USMCA country under GN 11(b)(i), nor is the product produced exclusively from originating materials per GN 11(b)(ii). Thus, we must determine whether the product qualifies under GN 11(b)(iii).
As noted, the merchandise under review is classified under subheading 1904.10.0080, HTSUS. The applicable rule of origin for goods classified under subheading 1904.10.0080, HTSUS, is in GN 11(o)/19.8, HTSUS, which provides for [a] change to subheading 1904.10 from any other chapter.
The Apple Strawberry Oat & Almond Cereal is said to contain the following non-originating ingredients that need to undergo the tariff shift: coconut chiplets, sunflower seeds, pumpkin seeds, coconut oil, coconut butter, dried strawberries, and cinnamon powder. Since the non-originating ingredients are all classified in a chapter other than Chapter 19, the tariff shift rule is met. Accordingly, the product is eligible for preferential tariff treatment under the USMCA.
The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP.
This merchandise is subject to The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act), which is regulated by the Food and Drug Administration (FDA). Information on the Bioterrorism Act can be obtained by calling FDA at 301-575-0156, or at the Web site www.fda.gov/oc/bioterrorism/bioact.html.
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, please contact National Import Specialist Frank Troise at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division