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September 2, 1999

CLA-2-04:RR:NC:2:231 E84903


TARIFF NO.: 0406.30.9100

Mr. David Dunbar
Katten, Muchin, and Zavis
525 West Monroe Street, Suite 1600
Chicago, IL 60661-3693

RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA) of processed cheese from Mexico; Article 509

Dear Mr. Dunbar:

In your letter, dated June 29, 1999, on behalf of your client, Kerry Ingredients, Beloit, WI, you have requested a ruling on the status of processed cheese from Mexico under the NAFTA.

The product in question is described as an enzyme modified pasteurized process cheese product that has been processed from Cheshire cheese and made in Mexico with milkfat and milk protein concentrate from cow's milk and other ingredients. All ingredients will be originating in Mexico, Canada and/or the United States, except that the emulsifying salts, lactic acid and enzyme may also originate in non-NAFTA countries. The enzyme ingredient will consist of commercially available food grade lipase and protease enzymes. It is stated that this product will be processed from the following ingredients:

Ingredient Percentage by Weight

Cheshire cheese 70 - 78 concentrated milkfat 12 - 18 emulsifying salts 1 - 2
(citrates and/or phosphate salts) water 7 - 13 lactic acid 0.1 - 3 enzyme <1
In the above listing, the ingredient listed as concentrated milkfat will be in the form of concentrated cream with a fat content of 55 - 75 percent, butter with a fat content of 80 - 83 percent or anhydrous milkfat with a fat content of 97 - 99.5 percent. This concentrated milkfat ingredient and, indeed, all of the processing ingredients, will be sourced in Mexico, the United States and/or Canada, depending on price and availability.

Processing in Mexico is described as follows:

1. All ingredients are combined in a mixing vessel. 2. A period of time is allowed to elapse (the time period being determined by the extent of enzyme modification required). 3. The mixture is heated to 180 degrees Fahrenheit and kept at that temperature for longer than one minute. 4. Following pasteurization, the resulting oil-in-water emulsion is cooled, packaged, and refrigerated. 5. The product will be packaged as cheese blocks in polyliners in corrugated cartons, or in blocks in polyliners in corrugated totes. The weight of the cheese blocks will be 18.1 kilograms, 20 kilograms, 22.7 kilograms, or 25 kilograms.

The finished process cheese food will contain milkfat (27-33 percent by weight), protein (17-23 percent by weight), water (35-41 percent by weight) and salt (0.5-2 percent), with a pH ranging from 5.3 to 6.3.

The imported product will be used in a variety of industrial products, such as process cheese, cheese sauces and spreads, cheese-flavored dips, and cheese powder for snack food seasoning.

The applicable subheading for enzyme modified pasteurized process Cheshire cheese food will be 0406.30.9100, Harmonized Tariff Schedule of the United States (HTS), which provides for cheese and curd, processed (process) cheese, not grated or powdered, other, including mixtures of the above, other, other, other, containing cow's milk, other. The general rate of duty will be $1.553 per kilogram.

The process Cheshire cheese food, if wholly obtained or produced entirely in the territories of Canada, Mexico, and/or the United States, will meet the requirements of HTSUSA General Note 12(b)(i). Alternately, if the emulsifying salts, enzyme and/or lactic acid are sourced in a non-NAFTA country, the process Cheshire cheese food will meet the requirements of HTSUSA General Note 12(t)(4). Under either General Note these goods will be entitled to a free rate of duty under the NAFTA. Upon compliance with all applicable laws, regulations, and agreements under NAFTA, goods imported from Mexico which are entered in subheading 0406.30.9100, HTSUSA, are subject to duty under subheadings 9906.05.82-9906.05.84, HTSUSA. Subheading 9906.05.82 provides that a total quantity of such goods may be entered free of duty up to a quantity not to exceed 6,433,000 kilograms during calendar year 1999. Quantities in excess of this amount are subject to duty at one of the following rates: for products valued not over $2.30 per kilogram, classification would be in subheading 9906.05.83, HTSUSA, with duty at the rate of 64.2 cents per kilogram; for products valued over $2.30 per kilogram, classification would be in subheading 9906.05.84, with duty at the rate of 27.8 percent ad valorem.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 CFR 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 Thomas Brady at (212) 637-7064.


Robert B. Swierupski

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