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HQ 958912

JUNE 21, 1996

CLA-2 RR:TC:MM 958912 JAS



Port Director of Customs
P.O. Box 3130
Laredo, TX 78044

RE: PRD 2304-95-100219; Dump Truck of Canadian Origin Imported into the customs territory from Mexico; Canadian Article, Originating Good; Automotive Products Trade Act (APTA); General Notes 5 and 12, HTSUS; Transshipment; NAFTA Rules of Origin Regulations; Section 16 of the Appendix to Part 181 of Title 19 CFR; HQ 958053

Dear Port Director:

This is our decision on protest 2304-95-100219, filed by a representative of Trax, Inc., against your denial of free entry under the Automotive Products Trade Act of 1965, as amended, for dumper cab chassis. The entries were liquidated on November 11, 1995, and this protest timely filed on December 4, 1995.


The merchandise is invoiced as two Euclid R-35 Rock Truck Chassis, serial numbers 324TDC74674 and 7, and described on the Customs Form 7501 as off-highway dumper cab chassis. They were manufactured in Canada, then exported to Mexico where they were released from Customs control, used for an indeterminate period of time, then entered into the customs territory of the United States under the Automotive Products Trade Act of 1965, as amended (APTA). The proper APTA certification and documentation of Canadian origin are not in issue.

Both the importer/protestant and your office agree that subheading 8704.10.10, Harmonized Tariff Schedule of the United States (HTSUS), a provision for dumpers designed for off-highway use, cab chassis, represents the correct classification. Notwithstanding the issuance of a ruling on this issue to the importer/protestant, HQ 958053, dated September 20, 1995, your office believes that these vehicles are not eligible for the - 2 -
duty-free benefits conferred by the APTA because they were not imported directly into the customs territory of the United States from Canada.


Whether articles otherwise qualifying as originating goods lose that status by virtue of their use in Mexico.


General Note 5(a), HTSUS, Automotive Products and Motor Vehicles Eligible for Special Tariff Treatment, provides that motor vehicles and original motor-vehicle equipment which are Canadian articles and which fall in provisions for which the rate of duty "Free (B)" appears in the "Special" subcolumn may be entered free of duty under the Automotive Products Trade Act. In accordance with Note 5(a)(I) the term "Canadian article" means an article which originates in Canada, as defined in General Note 12.

Paragraph (b) of General Note 12, HTSUS, North American Free Trade Agreement, establishes the criteria under which goods imported into the customs territory of the United States qualify as originating goods for NAFTA purposes. There is no dispute that the dumper in issue qualifies as an originating good under General Note 12.

General Note 12(l), HTSUS, Transshipment, states that a good shall not be considered to be an originating good by reason of having undergone production that satisfies the requirements of this note if, subsequent to that production, the good undergoes further production or any other operation outside the territories of the NAFTA parties, other than unloading, reloading or any other operation necessary to preserve it in good condition or to transport the good to the territory of Canada, Mexico and/or the United States. Rule 12(l) is interpreted by the NAFTA Rules of Origin Regulations which appear in the Appendix to Part 181 of Title 19, Code of Federal Regulations (19 CFR 181). Paragraph (1)(a) of PART VI, SECTION 16. TRANSSHIPMENT, states in relevant part that a good otherwise qualifying as an originating good loses that status if the good is withdrawn from customs control outside the territories of the NAFTA countries.


The dumpers under protest, serial numbers 324TDC74674 and 7, qualify as originating goods under General Note 12, HTSUS. Upon importation into the customs territory of the United States from Mexico, they are within the term "Canadian article" for purposes of General Note 5, HTSUS. They are eligible for entry free of duty under the APTA if all applicable requirements are satisfied.

The protest should be ALLOWED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you should mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and to the public via the Diskette Subscription Service, the Freedom of Information Act and other public access channels.


John Durant, Director
Tariff Classification

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