H312091

HQ H312091 December 18, 2020 OT:RR:CTF:FTM H312091 PJG CATEGORY: Classification; Origin; Marking Mr. Jeff Kendall UPS Supply Chain Solutions 2150 Peace Portal Drive Blaine, Washington 98230 Re: Country of origin marking and tariff classification of coffee beans blended and/or decaffeinated in Canada; Applicability of USMCA Dear Mr. Kendall: This is in response to your request, dated June 20, 2020, filed on behalf of Swiss Water Decaffeinated Coffee Company, Inc. (“Swiss Water”), requesting a binding ruling on the country of origin marking and tariff classification of green unroasted coffee beans that are decaffeinated in Canada and the Cascadia FTO and TDL Blends, which are blends of coffee beans from multiple countries that are blended and decaffeinated in Canada. You also inquire about the eligibility of these products for preferential tariff treatment under the United States-Mexico-Canada Agreement (“USMCA”). The National Commodity Specialist Division forwarded your request to this office for a response. Along with your ruling request, you submitted a process flow diagram of the unroasted decaffeinated coffee beans and two documents indicating details of the beans used to formulate the “Cascadia FTO Blend” and the “TDL Blend,” including the origin of each variety of beans. FACTS: In your ruling request and accompanying Blend Sheets, you identified four products for our consideration, specifically: 1) green unroasted coffee beans that are grown and harvested in the United States; 2) green unroasted coffee beans that are grown and harvested in Mexico; 3) a blend of coffee identified as “TDL Blend,” which consists of coffee beans that are grown in Brazil and Colombia; and 4) a blend of coffee identified as “Cascadia FTO Blend,” which consists of coffee beans that are grown in five countries, specifically, Indonesia, Ethiopia, Timor-Leste, Honduras, and Guatemala. You note that all of the coffee beans for the “Cascadia FTO Blend” are certified organic. You have further indicated that the blending and decaffeination of the blend coffees occurs in Canada. You also indicated that the green unroasted coffee beans are decaffeinated in Canada. You have indicated that the decaffeination process involves the use of water and green coffee extract (obtained by soaking coffee beans in water). ISSUES: What is the tariff classification of the green unroasted coffee beans that are decaffeinated in Canada and the Cascadia FTO Blend and TDL Blend that are blended and decaffeinated in Canada? Whether the green unroasted coffee beans, the Cascadia FTO Blend, and/or the TDL Blend are eligible for preferential tariff treatment under the USMCA? What is the country of origin for marking purposes of the green unroasted coffee beans that are decaffeinated in Canada and the Cascadia FTO Blend and TDL Blend that are blended and decaffeinated in Canada? LAW AND ANALYSIS: What is the tariff classification of the green unroasted coffee beans that are decaffeinated in Canada and the Cascadia FTO Blend and TDL Blend that are blended and decaffeinated in Canada? The classification of merchandise under the Harmonized Tariff Schedule of the United States (“HTSUS”) is governed by the General Rules of Interpretation (“GRI”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. The 2020 HTSUS provision under consideration is as follows: 0901 Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion: Coffee, not roasted: 0901.12.00 Decaffeinated: 0901.12.0015 Certified Organic 0901.12.0025 Other The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the “official interpretation of the Harmonized System” at the international level. See 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). While neither legally binding nor dispositive, the ENs “provide a commentary on the scope of each heading” of the HTSUS and are “generally indicative of [the] proper interpretation” of these headings. See id. The merchandise at the time of importation consists of three coffee bean products, which we will address in turn here. The decaffeinated green unroasted coffee beans and decaffeinated TDL Blend, are classified under heading 0901, HTSUS, and specifically in subheading 0901.12.0025, HTSUS, which provides for “Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion: Coffee, not roasted: Decaffeinated: Other.” The “Cascadia FTO Blend” that are decaffeinated and identified as “Fairtrade Organic,” are classified under heading 0901, HTSUS, and specifically in subheading 0901.12.0015, HTSUS, which provides for “Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion: Coffee, not roasted: Decaffeinated: Certified Organic.” Whether the green unroasted coffee beans, the Cascadia FTO Blend, and/or the TDL Blend are eligible for preferential tariff treatment under the USMCA? The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30, 2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020, of the USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. § 4511(a)). General Note (“GN”) 11 of the HTSUS implements the USMCA. GN 11(a)(i) provides that: Goods that originate in the territory of Mexico, Canada or the United States (hereinafter referred to as “USMCA country” or “USMCA countries” as further defined in subdivision (l)(xxiv) of this note) under the terms of subdivision (b) of this note and regulations issued by the Secretary of the Treasury (including Uniform Regulations provided for in the USMCA), and goods enumerated in subdivision (p) of this note, when such goods are imported into the customs territory of the United States and are entered under a subheading for which a rate of duty appears in the “Special” subcolumn, followed by the symbol “S” in parentheses, are eligible for such duty rate, in accordance with section 202 of the United States-Mexico-Canada Agreement Implementation Act. Accordingly, if all other requirements are satisfied, merchandise imported into the United States will qualify for preferential tariff treatment under the USMCA if it meets one of the origin criteria enumerated in GN 11(b). GN 11(b) provides as follows: For the purposes of this note, a good imported into the customs territory of the United States from the territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the tariff schedule as a “good originating in the territory of a USMCA country” only if— the good is a good wholly obtained or produced entirely in the territory of one or more USMCA countries; the good is a good produced entirely in the territory of one or more USMCA countries, exclusively from originating materials; the good is a good produced entirely in the territory of one or more USMCA countries using non-originating materials, if the good satisfies all applicable requirements set forth in this note (including the provisions of subdivision (o)); or * * * GN11(l)(iv)(2) defines the term “Good wholly obtained or produced entirely in the territory of one or more USMCA countries,” in relevant part, as follows: The term ‘good wholly obtained or produced entirely in the territory of one or more USMCA countries’ means any of the following: * * * (2) a plant, plant good, vegetable or fungus grown, cultivated, harvested, picked or gathered in the territor

What is the tariff classification of the green unroasted coffee beans that are decaffeinated in Canada and the Cascadia FTO Blend and TDL Blend that are blended and decaffeinated in Canada? The classification of merchandise under the Harmonized Tariff Schedule of the United States (“HTSUS”) is governed by the General Rules of Interpretation (“GRI”). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied. The 2020 HTSUS provision under consideration is as follows: 0901 Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion: Coffee, not roasted:0901.12.00 Decaffeinated:0901.12.0015 Certified Organic0901.12.0025 OtherThe Harmonized Commodity Description and Coding System Explanatory Notes(“ENs”) constitute the “official interpretation of the Harmonized System” at the international level. See 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). While neither legally binding nor dispositive, the ENs “provide a commentary on the scope of each heading” of the HTSUS and are “generally indicative of [the] proper interpretation” of these headings. See id.The merchandise at the time of importation consists of three coffee bean products, which we will address in turn here. The decaffeinated green unroasted coffee beans and decaffeinated TDL Blend, are classified under heading 0901, HTSUS, and specifically in subheading 0901.12.0025, HTSUS, which provides for “Coffee, whether or not roasted or decaffeinated; coffee husks and skins; coffee substitutes containing coffee in any proportion: Coffee, not roasted: Decaffeinated: Other.” The “Cascadia FTO Blend” that are decaffeinated and identified as “Fairtrade Organic,” are class