CLA-2-71:OT:RR:NC:N1:128
Laura Moya
Nakachi Eckhardt & Jacobson, P.C.
50 California Street
San Francisco, CA 94111
RE: The tariff classification, country of origin, marking, and eligibility of the United States-Mexico-Canada
Agreement (USMCA) of gold waste and scrap
Dear Ms. Moya:
In your letter dated October 22, 2025, you requested a ruling on on behalf of your client, Sunrise Jewelry
Manufacturing Corporation, for the tariff classification, country of origin for marking purposes, and
eligibility of merchandise under the United States-Mexico-Canada Agreement (USMCA).
The merchandise under consideration is described as gold waste and scrap. From the information provided,
99.99% by weight unwrought gold in the form of grain from the United States is shipped to Mexico. In
Mexico, the gold is mixed with alloys and cast into a wax tree mold shaped to replicate the final jewelry
design. Once the metal has cooled, each piece is removed from the casting tree using a hand-held cutter;
these pieces are then processed into jewelry and polished. The excess materials from this cutting process, as
well as the dust created by polishing the finished jewelry, are collected and exported to the United States,
where they are refined to recover the gold they contain.
In your ruling request you suggest classification of the dust containing gold in 7112.30.0100, Harmonized
Tariff Schedule of the United States (HTSUS), as ash containing precious metal or precious metal
compounds. However, ash is created by the incineration of materials. The waste at issue is created by the
application of an abrasive to the finished jewelry, resulting in dust which contains gold. Classification in
7112.30.0100, HTSUS, is precluded.
The applicable subheading for the gold waste and scrap will be 7112.91.0100, HTSUS, which provides for
“Waste and scrap of precious metal or of metal clad with precious metal; other waste and scrap containing
precious metal or precious metal compounds, of a kind used principally for the recovery of precious metal
other than goods of heading 8549: Other: Of gold, including metal clad with gold but excluding sweepings
containing other precious metals.” The general rate of duty will be Free.
In your ruling request you suggest that the country of origin of the gold waste and scrap is the United States,
stating that there is no substantial transformation in Mexico.
Section 134.1(b) of the Customs Regulations (19 CFR 134.1(b)) provides that the “[c]ountry of origin”
means 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 Part 134,
Customs Regulations (19 CFR Part 134). Substantial transformation requires that “[t]here must be a
transformation; a new and different article must emerge, ‘having distinctive name, character, or use.’”
Anheuser-Busch Brewing Association v. United States, 207 U.S. 556, 28 S. Ct 204 (1908).
With regards to the waste and scrap at issue, unwrought gold grain consisting of 99.9% gold by weight from
the United States is shipped to Mexico. In Mexico, the gold grain is alloyed with base metals, melted, and
cast into identifiable jewelry components. This results in new and different articles which have a distinctive
name, character and use from the unwrought gold grain. As the goods are substantially transformed in
Mexico, the country of origin of waste and scrap collected from those goods is Mexico.
Regarding country of origin 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 CFR 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 CFR § 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.
19 CFR § 102.1(g) states, in pertinent part, that “A good ‘wholly obtained or produced’ in a country
means…waste a scrap derived from: production in a country, or used goods collected in that country
provided such goods are fit only for the recovery of raw materials.” The waste and scrap at issue is derived
from production in Mexico. It is therefore considered wholly obtained or produced in Mexico under 19 CFR
§ 102.11(a)(1). As such, the country of origin of the waste and scrap for marking purposes is Mexico.
In your ruling request you ask if this waste and scrap is eligible for duty-free treatment under the 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:
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))
The waste and scrap at issue is produced entirely in the territory of one or more USMCA countries under GN
11(b)(i). It is therefore eligible for preferential tariff treatment under the USMCA.
Products of Mexico as provided by heading 9903.01.01 in Section XXII, Chapter 99, Subchapter III, U.S.
Note 2(a), HTSUS, other than products classifiable under headings 9903.01.02, 9903.01.03, 9903.01.04, and
9903.01.05, HTSUS, will be subject to an additional 25 percent ad valorem rate of duty. Articles that are
entered free of duty under the terms of general note 11 to the HTSUS (USMCA), including any treatment set
forth in subchapter XXIII of Chapter 98 and subchapter XXII of chapter 99 of the HTSUS, will not be
subject to the additional ad valorem duties provided for in heading 9903.01.01. If your product is entered
duty free as originating under the USMCA, you must report heading 9903.01.04, HTSUS, in addition to
subheading 7112.91.0100, HTSUS.
Effective April 5, 2025, Executive Orders implemented “Reciprocal Tariffs.” All imported merchandise
must be reported with either the Chapter 99 provision under which the reciprocal tariff applies or one of the
Chapter 99 provisions covering exceptions to the reciprocal tariffs. At this time, products of Mexico are not
subject to reciprocal tariffs. At the time of entry, you must report the Chapter 99 heading applicable to your
product classification, i.e. 9903.01.27, in addition to subheading 7112.91.0100, HTSUS, listed above.
In your ruling request, you suggest secondary classification of this waste and scrap under 9801.00.1030,
HTSUS, which provides for: “Products of the United States when returned after having been exported, or any
other products when returned within 3 years after having been exported, without having been advanced in
value or improved in condition by any process of manufacture or other means while abroad: Articles
provided for in chapter 71.”
However, the product of the United States involved in this scenario, i.e., the gold grain, is alloyed and cast
into specific shapes, resulting in substantial transformation in Mexico. The waste and scrap collected from
this merchandise is therefore not a product of the United States. Classification in heading 9801.00.1030,
HTSUS, is precluded.
You also suggest secondary classification under 9817.00.90, HTSUS, which provides for: “Unwrought metal
including remelt scrap ingot (except copper, lead, zinc and tungsten) in the form of pigs, ingots or billets (a)
which are defective or damaged, or have been produced from melted down metal waste and scrap for
convenience in handling and transportation without sweetening, alloying, fluxing or deliberate purifying, and
(b) which cannot be commercially used without re-manufacture; relaying or rerolling rails; and articles of
metal (except articles of lead, of zinc or of tungsten, and not including metal-bearing materials provided for
in section VI, chapter 26 or subheading 8549.11, 8549.12, 8549.13, 8549.14, 8549.19 and not including
unwrought metal provided for in chapters 72-81) to be used in remanufacture by melting or to be processed
by shredding, shearing, compacting or similar processing which renders them fit only for the recovery of the
metal content: Other.”
Subheading 9817.00.90, HTSUS encompasses three categories of goods: (1) certain unwrought metal pigs,
ingots or billets; (2) relaying or rerolling rails; and (3) with certain exceptions not relevant here, articles of
metal to be used in remanufacture by melting or to be processed by shredding, shearing, compacting or
similar processing which renders them fit only for the recovery of the metal content.
You provided photographs the waste and scrap which will be imported. These include the cylindrical “tree
trunks” left over from the casting process; wishbone-shaped pieces; small, irregular pieces; and dust obtained
from polishing the finished jewelry. None of these forms are pigs, ingots, or billets. The waste and scrap
similarly does not fall under the second category of goods as relaying or rerolling rails.
However, the waste and scrap falls in the third category of goods as articles of metal which will be processed
in a way which renders it fit only for the recovery of metal content.
To qualify for classification under subheading 9817.00.90, HTSUS, however, a number of requirements
under the Code of Federal Regulations (CFR) must be met.
First, under 19 CFR § 54.6, merchandise meeting the above-identified provision of subheading 9817.00.90,
HTSUS shall be admitted duty-free subject to the following conditions, as applicable:
(1) In connection with the entry there shall be filed a statement of the importer that the intended use of the
merchandise is one of the uses provided for in the subheading;
(2) A bond, as required in 19 CFR 54.6(b) and 113.62, is filed;
(3) Liquidation of the entry shall be suspended pending proof of use or other disposition of the merchandise
within 3 years from the date of entry;
(4) Within 3 years from the date of entry, the importer shall submit to the director of the port of entry a
statement from the superintendent or manager of the plant at which the articles were used in remanufacture
by melting, or were processed by shredding, shearing, compacting, or similar processing showing the
information listed in 19 CFR 54.6(c)(1) through (4)[; and]
(5) If satisfactory proof of use of the articles in remanufacture as required is furnished within 3 years from the
date of entry, the entry shall be liquidated without duty on the covered articles; if not, the entry shall be
liquidated without any exemption from duty under subheading 9817.00.90, HTSUS.
Second, as subheading 9817.00.90, HTSUS contains the language “to be used,” it is an actual use provision.
Classification of an article within an actual use provision is controlled by the article’s actual use, and three
conditions under 19 CFR § 10.133 must be met: 1) the use is intended at the time of importation; 2) the
article is so used; and 3) proof of use is furnished within 3 years after the date the article is entered or
withdrawn from warehouse for consumption.
Upon compliance with 19 CFR. § 54.6 and 19 CFR § 10.133, this gold waste and scrap is classifiable under
subheading 9817.00.90, HTSUS.
The tariffs and additional duties cited above are current as of this ruling’s issuance. 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/.
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 ruling is being issued under the provisions of Part 177 of the Customs and Border Protection
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 Nicole Sullivan at [email protected].
Sincerely,
(for)
Deborah Marinucci
Designated Official Performing the Duties of the Division Director
National Commodity Specialist Division