The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a leather workboot from Canada; Article 509

NY E80241 May 5, 1999 CLA-2-64:RR:NC:TP:347 E80241 CATEGORY: Classification TARIFF NO.: 6403.40.60 Mr. Karl F. Krueger AEI Customs Brokerage Services P.O. Box 5129 Southfield, MI 48086-5129 RE: The tariff classification and status under the North American Free Trade Agreement (NAFTA), of a leather workboot from Canada; Article 509 Dear Mr. Krueger: In your letter dated March 29, 1999, written on behalf of your client, Greb International, you requested a ruling on the status of a leather shoe with a steel toe and shank from Canada under the NAFTA. You have submitted a sample of what you refer to as a “Kodiak” brand workboot, style #37750, with a steel toe and shank, leather upper and rubber/plastic outer sole. The shoe covers the ankle and features a lace-tie closure. You also ask for NAFTA applicability. You state that these boots will be imported from Canada through various ports along the eastern border with Canada and, by air, to various ports in the United States. You state that the boot is made from Mexican leather (partially tanned leather from the United States is re-tanned in Mexico) which is sent to Costa Rica. The upper is cut and stitched in Costa Rica, using Mexican leather, United States lining and other United States and Costa Rican materials and are made into unformed uppers. You state that the unformed uppers are then sent to Canada where the steel toes are added and they are affixed to the soles, which are of Canadian origin. The applicable tariff provision for the “Kodiak” brand workboot will be 6403.40.60, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for footwear with leather uppers and rubber and/or plastic outer soles, footwear incorporating a protective metal toe-cap. The general rate of duty from Canada will be 8.5% ad valorem. The merchandise does not qualify for preferential treatment under the NAFTA because one or more of the non-originating materials used in the production of the goods will not undergo the change in tariff classification required by General Note 12(t)/64, HTSUSA. Subdivision (t) of General Note 12 for Chapter 64, states that in order to qualify for NAFTA there must be “a change to headings 6401 through 6405 from any heading outside that group, except from subheading 6406.10....” Subheading 6406.10 of the Harmonized Tariff Schedule of the United States covers both formed and unformed uppers. In Canada, the unformed uppers of heading 6406.10 are turned into complete shoes of heading 6403. Therefore, your footwear does not qualify for NAFTA duty preference. In determining the country of origin for the shoes, we used the NAFTA rules of origin described in CFR 102.11(a)(3) which states that the country of origin of a good is the country in which “each foreign material incorporated in that good undergoes an applicable change in tariff classification set out in 102.20 ...” The country of origin rules set out in CFR 102.20 for chapter 64 state that in order to determine origin for a good “a change to heading 6401 through 6405 from any other heading outside that group, except from formed uppers” must be met. Since you will be importing “unformed” uppers into Canada to be produced into completed shoes there, the country of origin for the footwear will be Canada. This ruling is being issued under the provisions of Part 181 of the Customs Regulations (19 C.F.R. 181). 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 Richard Foley at 212-637-7089. 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. Sincerely, Robert B. Swierupski Director, National Commodity Specialist Division