April 24, 2009 CBP Bulletin Notice on NAFTA Country of Origin Marking of Polyurethane Foam Product

Proposed modification of ruling; proposed revocation of treatment. CBP is proposing to modify one ruling on the country of origin marking of "Stepanfoam RI-9736-B." Additionally, CBP proposes that this notice covers any rulings that similarly reflect this interpretation of the CBP country of origin marking regulations that may exist but have not been specifically identified. CBP is also proposing to revoke any treatment it has previously accorded to substantially identical transactions.

CBP states that any party who has received a contrary written ruling or decision on the merchandise that is subject to the proposed modification and revocation, or any party involved with a substantially identical transaction, should advise CBP by May 24, 2009, the date that written comments on the proposed ruling are due. Furthermore, CBP states that an importer's failure to advise CBP of such rulings, decisions, or substantially identical transactions may raise issues of reasonable care on the part of the importer or its agent for importations subsequent to the effective date of the final decision in this notice.

Polyurethane resin foam product. Stepanfoam RI 9736-B is a mixture of U.S.-origin polyurethane, classified in HTS subheading 3909.50.50 and a Mexican-origin blowing agent - dichlorofluoroethane - classified in HTS 2903.49.60.

CBP is proposing to issue HQ H046759 in order to modify NY N029916 and revise the country of origin determination for marking purposes. In NY N029916, CBP determined that the goods qualified under the NAFTA preference override of 19 CFR 102.19(b) and that therefore the country of origin for duty and marking purposes was Mexico. CBP now proposes that this ruling is incorrect in that the NAFTA preference override of 19 CFR 102.19(b) only determines the country of origin of a good for duty purposes. The country of origin for marking purposes of a good is not determined by operation of 19 CFR 102.19(b).

CBP Regulations in 19 CFR 102.11 set forth the required hierarchy for determining whether a good is a good of a NAFTA country for marking purposes. Because the Stepanfoam RI 9736-B is made from polyurethane that is manufactured in the U.S. and blended with a blowing agent in Mexico, it is neither wholly obtained or produced (19 CFR 102.11(a)(1)), nor produced exclusively from domestic materials (19 CFR 102.11(a)(2)).

The Stepanfoam RI 9736-B also does not meet the requirements of 19 CFR 102.11(a)(3) which requires each foreign material to undergo an applicable change in tariff classification set out in 19 CFR 102.20 and satisfy any other applicable requirements, as Stepanfoam RI 9736 and the Stepanfoam RI 9736-B are both classified under the same subheading.

CBP then looks to 19 CFR 102.11(b)(1) and 102.18 (b)(1)(iii), which both pertain to essential character, and determines that the essential character of the Stepanfoam RI 9736-B is imparted by the U.S.-origin polyurethane.

Accordingly, the country of origin for marking purposes of the Stepanfoam RI 9736-B is the United States. The Stepanfoam RI 9736-B is not required to be marked.

(19 CFR 102.18 (b)(1)(iii) provides that if there is only one material that is classified in a tariff provision from which a change in tariff classification is not allowed under the 102.20 specific rule or other requirements applicable to the good, then that material will represent the single material that imparts the essential character to the good under 102.11.)

Proposed: US origin, no marking required; Current: marking "Made in Mexico" required

April 24, 2009 CBP Bulletin (Vol. 43, No. 17) available athttp://www.cbp.gov/xp/cgov/trade/legal/bulletins_decisions/bulletins_2009/