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NY C89505

July 13, 1998

CLA-2-21:RR:NC:2:228 C89505


TARIFF NO.: 2106.90.6400; 2106.90.6600

Mr. Clark D. Bien

Total Foods Corporation

6018 West Maple Road Suite 888

West Bloomfield, MI 48322

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a food ingredient from Canada; Article 509

Dear Mr. Bien:

In your letter dated June 19, 1998 you requested a ruling on the status of "confectionery fat" from Canada under the NAFTA.

A sample and ingredients breakdown accompanied your letter. The sample was examined and disposed of. The product is a yellow-colored, solid material said to be composed of 51 percent granulated sugar and 49 percent anhydrous milk fat. The product will be used in the manufacture of candy, confectionery, and ice cream. The sugar will be a product of a non-NAFTA country, and the anhydrous milk fat may be of Canadian, New Zealand, or Danish origin. In Canada, the ingredients are mixed in blending tanks and the finished good is packed in trailer tanks or 50-gallon drums.

The applicable subheading for this product, if imported in quantities that fall within the limits described in additional U.S. note 10 to chapter 4, will be 2106.90.6400, Harmonized Tariff Schedule of the United States (HTS), which provides for food preparations not elsewhere specified or included...other... containing over 10 percent by weight of milk solids...other, dairy products described in additional U.S. note 1 to chapter 4...described in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. The rate of duty will be 10 percent ad valorem. If the quantitative limits of additional U.S. note 10 to chapter 4 have been reached, the product will be classified in subheading 2106.90.6600, HTS, and dutiable at the rate of 74.5 cents per kilogram plus 9 percent ad valorem.

When produced from Canadian milk fat and sugar of non-NAFTA origin, the non-originating material used to make the confectionery fat will have satisfied the change in tariff classification required under HTSUSA General Note 12(t)/21.12. Under these circumstances, the confectionery fat, when classified in subheading 2106.90.6400, HTS, will be entitled to a free rate of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.

When produced from milk fat from Denmark or New Zealand and sugar from a non-NAFTA country, the merchandise does not qualify for preferential treatment under the NAFTA because the one of the non-originating materials used in the production of the good (the milk fat) will not undergo the change in tariff classification required by General Note 12(t)/21.12, HTSUSA.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181).

This ruling letter is binding only as to the party to whom it is issued and may be relied on only by that party.

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 Stanley Hopard at 212-466-5760. Your request for a tariff classification ruling for this product, when produced in a non-NAFTA country, is the subject of New York Ruling Letter NY C89966.

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, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229.


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