H335509

HQ H335509 December 21, 2023 OT:RR:CTF:VS H335509 AP CATEGORY: Origin Center Director Base Metals CEE U.S. Customs and Border Protection 610 S. Canal St. Chicago, IL 60607 Attn: Christopher Koon, CBP Import Specialist RE: Internal Advice; Application for Further Review of Protest No. 5203-23-100456; Coated and Embossed Aluminum Coils; U.S.-Jordan Free Trade Agreement Dear Center Director: This is in response to your November 29, 2023 request for an internal advice with regard to Protest No. 5203-23-100456, and the Application for Further Review (“AFR”), concerning the eligibility of certain finished aluminum coils, which were imported by FCC Metals LLC (“importer”) into the United States from Jordan, for duty-free treatment under the United States-Jordan Free Trade Agreement (“JFTA”). Our response follows. FACTS: The subject aluminum alloy 3003 series, temper H44 and H444 (3003-H44 and 3003-H444) coated and embossed aluminum coils, described as “pre-painted aluminum coils” on the bills of lading, were imported into the United States from Jordan under subheadings 7606.12.30, Harmonized Tariff Schedule of the United States (“HTSUS”) and 9903.85.01, HTSUS, claiming preferential tariff treatment under the JFTA. The product is further described as “common alloy aluminum sheet for use as sheet metal roofing products installed on buildings and houses. These products are imported on spools and measure approximately 50” in width by 0.56 millimeters in thickness (sizes vary depending on end U.S. customer specifications).” The finished aluminum coils were produced from 3003-H14 aluminum alloy coils in rolls (“raw aluminum coil” or “mother coil”) described as “aluminum coil mill finish, gauge 0.5600 mm x width 1266.80 mm coil” originating from Bahrain and exported to Jordan from Bahrain for further processing. In Jordan, the raw aluminum coils from Bahrain are placed in a coating line and unwound. The coils are cleaned to remove oxide layers, residual lubricant, and fine particles by passing the coil through two alkaline spray cleaning tanks with a brush-scrubbing unit in between. This cleaning process removes 0.2 to 0.3g per square meter of the surface coil. The coil is then chemically treated with a thin coating to prevent the metal surface from re-oxidizing and provide a stable layer for adhesion of subsequent coatings. A vertical coater applies the pre-treatment, a thin coating, less than a tenth of a micrometer. This coating is then cured by oven-drying at 90 degrees Celsius. For primer, there is one coating per head side. The topcoats require three coating heads on the top and two heads on the bottom. In addition to applying coatings, the supplier applies color pigments to the top coating to meet customer specifications. Finally, the slitting and embossing line cuts the coils to the customer’s desired width and trims the edges of the coil. Certain sheets require embossing to make the sheets less susceptible to warping. The coils then pass between two engraved rolls with a special design and structure to press the design of the rolls into the metal coils. These processes create the final coated and painted aluminum coils imported into the United States from Jordan. On June 3, 2022, the CEE issued a Notice of Action (CBP Form 28) to the importer requesting additional supporting documentation such as detailed explanation of the manufacturing process, production records, and commercial invoices, as part of its origin verification on the JFTA preferential tariff treatment claimed by the importer. On March 9, 2023, the CEE issued a Notice of Action (CBP Form 29) notifying the importer that the finished aluminum coils did not qualify for preferential tariff treatment under the JFTA. Specifically, the CEE noted that the processes on the aluminum coils that occurred in Jordan were considered finishing processes and did not result in new or different articles of commerce. Since the merchandise originated from Bahrain, it was subject to Department of Commerce (“DOC”) antidumping (“ADD”) order number A-525-001 and countervailing duty (“CVD”) order number C-525-002 for common alloy aluminum sheet from Bahrain. On March 9, 2023, CBP liquidated the 13 entries of finished aluminum coils filed from November 6, 2021 through December 23, 2021, as type “03” entries originating from Bahrain and subject to the DOC ADD/CVD orders. ISSUE: Whether the imported finished aluminum coils are eligible for duty-free treatment under the JFTA. LAW AND ANALYSIS: On October 24, 2000, the United States and the Hashemite Kingdom of Jordan signed the JFTA. The provisions of the JFTA were adopted by the United States with the enactment on September 28, 2001 of the United States-Jordan Free Trade Area Implementation Act (the “JFTA Act”), Public Law 107–43, 115 Stat. 243 (19 U.S.C. 2112 note). On December 7, 2001, the President signed Proclamation 7512 to implement the provisions of the JFTA. The Proclamation, published in the Federal Register on December 13, 2001 (66 F.R. 64497), modified the HTSUS as set forth in Annexes I and II of the Proclamation. The modifications to the HTSUS included the addition of General Note (“GN”) 18, incorporating the relevant JFTA rules of origin as set forth in the JFTA Act, and the insertion throughout the HTSUS of the preferential duty rates applicable to individual products under the JFTA designated by the special program indicator “JO” in the “Special” rate of duty subcolumn. CBP Regulations implementing the JFTA are set forth in Volume 19 of the Code of Federal Regulations at Part 10, Subpart K, §§ 10.701 through 10.712 (19 C.F.R. §§ 10.701 through 10.712). GN 18, HTSUS, sets forth the criteria for determining whether a good is an originating good for purposes of the JFTA as follows: … (b) For purposes of this note, subject to the provisions of subdivisions (d) and (e), goods imported into the customs territory of the United States are eligible for treatment as “products of Jordan” only if– (i) such goods are imported directly from Jordan into the customs territory of the United States, and (ii) they are– (A) wholly the growth, product or manufacture of Jordan, or (B) new or different articles of commerce that have been grown, produced or manufactured in Jordan and meet the requirements of subdivision (c) of this note. (c) (i) For purposes of subdivision (b)(ii)(A) of this note, … the expression “ wholly the growth, product or manufacture of Jordan” refers both to-- (A) an article which has been entirely grown, produced or manufactured in Jordan, and (B) all materials incorporated in an article which have been entirely grown, produced or manufactured in Jordan, but does not include articles or materials imported into Jordan from another country, whether or not such articles or materials were substantially transformed into new or different articles of commerce after their importation into Jordan. (ii) For purposes of subdivision (b)(ii)(B), goods are eligible for the tariff treatment provided in this note if the sum of– (A) the cost or value of the materials produced in Jordan, plus (B) the direct costs of processing operations performed in Jordan, is not less than 35 percent of the appraised value of such article at the time it is entered. If the cost or value of materials produced in the customs territory of the United States is included with respect to an article to which this subdivision applies, an amount not to exceed 15 percent of the appraised value of the article at the time it is entered that is attributable to such United States cost or value may be applied toward determining the percentage referred to in this subdivision …. We also refer to the CBP Regulations applicable to the JFTA. Pursuant to 19 C.F.R. § 10.709: (a) General. Except as otherwise provided in paragraph (b) of this section, a good imported directly from Jordan into the customs territory of the United States will be eligible for preferential tariff treatment under the US–JFTA 

On October 24, 2000, the United States and the Hashemite Kingdom of Jordan signed the JFTA. The provisions of the JFTA were adopted by the United States with the enactment on September 28, 2001 of the United States-Jordan Free Trade Area Implementation Act (the “JFTA Act”), Public Law 107–43, 115 Stat. 243 (19 U.S.C. 2112 note). On December 7, 2001, the President signed Proclamation 7512 to implement the provisions of the JFTA. The Proclamation, published in the Federal Register on December 13, 2001 (66 F.R. 64497), modified the HTSUS as set forth in Annexes I and II of the Proclamation. The modifications to the HTSUS included the addition of General Note (“GN”) 18, incorporating the relevant JFTA rules of origin as set forth in the JFTA Act, and the insertion throughout the HTSUS of the preferential duty rates applicable to individual products under the JFTA designated by the special program indicator “JO” in the “Special” rate of duty subcolumn. CBP Regulations implementing the JFTA are set forth in Volume 19 of the Code of Federal Regulations at Part 10, Subpart K, §§ 10.701 through 10.712 (19 C.F.R. §§ 10.701 through 10.712).GN 18, HTSUS, sets forth the criteria for determining whether a good is an originating good for purposes of the JFTA as follows:… (b) For purposes of this note, subject to the provisions of subdivisions (d) and (e), goods imported into the customs territory of the United States are eligible for treatment as “products of Jordan” only if– (i) such goods are imported directly from Jordan into the customs territory of the United States, and (ii) they are– (A) wholly the growth, product or manufacture of Jordan, or (B) new or different articles of commerce that have been grown, produced or manufactured in Jordan and meet the requirements of subdivision (c) of this note. (c) (i) For purposes of subdivision (b)(ii)(A) of this note, … the expression “ wholly the growth, product or manufacture of Jordan” refers both to-- (A) an article which has been