The tariff classification of axes from Canada

NY 862781 May 9, 1991 CLA-2-82:S:N:N1:106-862781 CATEGORY: Classification TARIFF NO.: 8201.40.6000 Mr. Brian Johnson Border Brokerage Company P.O. Box B Blain, Washington 98230 RE: The tariff classification of axes from Canada Dear Mr. Johnson: In your letter dated April 20, 1991, on behalf of Keystone Supplies, Richmond, BC, Canada, you requested a tariff classification ruling. You also asked if the axes imported into the United States are eligible for the special rate of duty under the United States-Canada Free Trade Agreement. The articles to be imported are axes that are assembled in Canada from components manufactured in the U.S.A., China and Taiwan. Following is a breakdown of individual components by country of manufacture and cost (which includes the cost of freight and brokerage into Canada). There are five different sizes of axe heads which can be incorporated onto two different sizes of handles. Component Country of manufacture Cost Handle "Tempest" U.S.A. $2.42 Handle "Red Stained" U.S.A. $2.02 Pulaski Head Axe China $2.13 3 1/2 # double bit axe China $2.32 3 1/2 # single bit axe China $1.95 5 # rafting axe China $2.43 3 # rafting axe China $1.46 Wooden wedge U.S.A. $0.09 Steel wedge U.S.A. $0.01 Labels Taiwan $0.07 Packaging Canada $0.18 Labor Canada $0.65 The applicable subheading for the axes will be 8201.40.6000, Harmonized Tariff Schedule of the United States (HTS), which provides for handtools of the following kinds: axes, and parts thereof (including the axe head). The rate of duty will be 6.2 percent ad valorem. General Note 3(c)(vii), HTS, covers goods originating in the territory of Canada that may be entitled to a special rate of duty. We call your attention to General Note 3(c)(vii)(H)(1) which states that, notwithstanding subdivision (c)(vii)(G), goods described in that paragraph shall be considered to have been transformed in the territory of Canada and be treated as goods originating in the territory of Canada and/or the United States if (1) the value of materials originating in the territory of Canada and/or the United States that are used or consumed in the production of the goods plus the direct cost of assembling the goods in the territory of Canada and/or the United States constitute not less than 50 percent of the value of the goods when exported to the territory of the United States, and (2) the goods have not subsequent to assembly undergone processing or further assembly in a third country and they meet the requirements of subdivision (c)(vii)(E) of this note. If your merchandise meets these requirements and the applicable regulations, then goods classifiable under subheading 8201.40.6000, HTS, which originated in the territory of Canada, will be entitled to a 4.3 percent rate of duty under the United States-Canada Free Trade Agreement. This ruling is being issued under the provisions of Section 177 of the Customs Regulations (19 C.F.R. 177). A copy of this ruling letter should be attached to the entry documents filed at the time this merchandise is imported. If the documents have been filed without a copy, this ruling should be brought to the attention of the Customs officer handling the transaction. Sincerely, Jean F. Maguire Area Director New York Seaport