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NY D80215

August 11, 1998

CLA-2-21:RR:NC:2:228 D80215


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 July 29, 1998 you requested a ruling on the status of a food ingredient from Canada under the NAFTA.

Ingredients breakdowns were submitted with your letter. "Confectionery fat," is used as an ingredient in the production of candy, confections, and ice cream, and will be imported in bulk trailers, 50-gallon drums, and/or 50-pound cardboard boxes. Three different formulations were provided. The product may be composed of 51 percent granulated sugar and 49 percent unsalted butter (83 percent butterfat), 89 percent unsalted butter and 11 percent granulated sugar, or 89 percent anhydrous milk fat and 11 percent granulated sugar.

The sugar will be a product of a non-NAFTA country. The anhydrous milk fat and the unsalted butter may be products of Canada, New Zealand, or Denmark. In Canada, the two ingredients will be blended together and packed as noted above.

The applicable subheading for the confectionery fat, 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 or Canadian butter, the non-originating material used to make the confectionery fat (the sugar) 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 made from milk fat or butter from Denmark or New Zealand, the confectionery fat will not qualify for preferential treatment under the NAFTA because one of the non-originating materials (the milk fat or butter) used in the production of the good 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 Denmark or New Zealand, is the subject of New York Ruling Letter NY D80216.

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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