CLA-2-39:RR:NC:FC:238 A87236
Mr. Thomas Penska
PBB Group
P.O. Box 950
434 Delaware Avenue
Buffalo, NY 14202
RE: The tariff classification, status, and country of origin marking, under the North American Free Trade Agreement (NAFTA), of STABOL, from Canada; Article 509
Dear Mr. Penska:
In your letter dated July 11, 1996 you requested a ruling on the status of STABOL, on behalf of your client, Bakor Inc., from Canada under the NAFTA.
According to the information submitted, the subject product, STABOL, consists of a water-soluble powder composed of a blend of 95% to 99% by weight of polyvinyl alcohol (sourced in Japan or Taiwan) and 1% to 5% by weight of sodium lignosulfonate (sourced in the U.S. or Canada). You state that the product will initially be used as a component in the manufacture of oil or wax-in-water emulsions, for waterproofing gypsum wallboard, wherein it functions as a protective colloid and stabilizer. You further indicate in your letter that the polyvinyl alcohol and sodium lignosulfonate will be blended together in Canada, and packaged in Canada in bags of (approximately) 50 to 1000 pounds.
The applicable tariff provision for STABOL will be 3905.30.0000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for: "Polyvinyl alcohols, whether or not containing unhydrolyzed acetate groups." The general rate of duty will be 3.2 percent ad valorem.
The merchandise does not qualify for preferential treatment under the NAFTA because one or more of the non-originating materials used in the production of the goods will not undergo the change in tariff classification required by General Note 12(t)/39.7, HTSUSA.
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 state that the components (i.e., polyvinyl alcohol and sodium lignosulfonate) making up the imported product (i.e., STABOL) are processed in a NAFTA country "Canada" prior to the importation of STABOL into the U.S. Since "Canada" is defined, under 19 CFR 134.1(g), as a NAFTA country, we must first apply the NAFTA Marking Rules in order to determine whether the imported product is 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 find that the imported product is not a "good of a NAFTA country" for marking purposes. Accordingly, in our opinion, the country of origin will be the country of manufacture of the polyvinyl alcohol, which, in the instant case, is Japan or Taiwan.
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 Coprnelius Reilly at 212-466-5770.
Should you wish to request an administrative review of this ruling, submit a copy of this ruling and all relevant facts and arguments within 30 days of the date of this letter, to the Director, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1301 Constitution Ave., NW, Franklin Court, Washington, DC 20229.
Sincerely,
Roger J. Silvestri
Director
National Commodity
Specialist Division