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NY H81054

June 5, 2001

CLA-2-39:RR:NC:N2:221 H81054


TARIFF NO.: 3926.90.9880; 9817.00.5000

Mr. Bill Jerome
H.A. & J.L. Wood, Inc.
231 N. 3rd Street
Pembina, ND 58271

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

Dear Mr. Jerome:

In your letter dated May 9, 2001, you requested a ruling,on behalf of Canadian Tarpaulin Manufacturers Ltd., on the tariff classification and status under the North American Free Trade Agreement (NAFTA) of bale stack covers from Canada.

The bale covers are made from fabric woven from high-density polyethylene strips that have been pigmented with carbon black. The strips measure approximately 2 mm in width, and thus meet the dimensional requirements to be considered textile strips. The woven fabric is covered on both sides with a layer of low-density polyethylene. The coating on the surface normally exposed to the sun is silver colored. The coating on the back surface is pigmented with carbon black. Both coatings are visible to the naked eye other than by change in color. This construction is considered to be of plastics for tariff classification purposes.

The bale stack cover is constructed using several widths of coated fabric heat welded together. Gravity straps constructed from polyester webbing are sewn at the seams and corners. Hems are folded over polypropylene rope reinforcement and then sewn. Brass eyelets are spaced at three-foot intervals. The covers are intended for use in agricultural settings to protect bale stacks, grain piles and equipment.

The applicable subheading for the bale stack covers will be 3926.90.9880, Harmonized Tariff Schedule of the United States (HTS), which provides for other articles of plastics, other. The general rate of duty will be 5.3 percent ad valorem.

Machinery, equipment and implements to be used for agricultural or horticultural purposes are provided for under the special classification provision of subheading 9817.00.5000, HTS. Upon compliance with the actual use requirements of Section 10.131-139 of the Customs Regulations, the bale stack covers would be classifiable in subheading 9817.00.5000, HTS, and would be free of duty.

You have also requested a ruling on the status of this product under NAFTA. You indicate that the coated polyethylene fabric, the polypropylene rope, the bonded polyester thread and the brass eyelets are manufactured in Canada. However, you have not indicated whether all of the materials used in the manufacture of these components are produced in Canada. If the high density polyethylene used to make the strips, the low density polyethylene used for the extrusion coating, and all the materials used to produce the resins and ropes and eyelets are produced in Canada, then the bale stack covers, being made entirely in the territory of Canada using materials which themselves were originating, will satisfy the requirements of HTSUSA General Note 12(b)(iii). The merchandise would then be free of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.

If the resins, the brass or the other materials used to produce the film, coating, rope or eyelets originate in countries other than the United States, Canada and Mexico, then the bale stack covers may still be eligible for preferential duty treatment under NAFTA since each of the non-originating materials used to make the tarpaulins has satisfied the changes in tariff classification required under the HTSUSA General Note 12(t)/39.10. In that case, the bale stack covers will also be subject to a Regional Value Content (RVC) requirement of 60 percent under the Transaction Value Method or 50 percent under the Net Cost Method as required under the rule applicable to the tarpaulins. Assuming the goods are eligible for preferential treatment under the NAFTA, the merchandise will be free of duty under the NAFTA upon compliance with all applicable laws, regulations, and agreements.

This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181). Because of insufficient information in your ruling request, Customs has not addressed the RVC of the subject goods. If the resin, the brass, or any other materials used to produce the resin, rope, thread or eyelets are from a non-originating country and you desire a ruling regarding the RVC of the tarpaulins and their eligibility for NAFTA preferential treatment, please send the information noted in Section 181.93(b) of the Customs Regulations (19 CFR 181.93(b)), to the Director, Commercial Rulings Division, Headquarters, U.S. Customs Service, 1300 Pennsylvania Ave. N.W., Washington, D.C. 20229, along with a copy of this letter. This information should include a breakdown showing the country of origin and cost for each material and showing the country of processing and cost for each of the manufacturing steps.

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 Joan Mazzola at 212-637-7034.


Robert B. Swierupski

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