82 FR 55387 - Notice of Issuance of Final Determination Concerning Roasted Coffee

DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection

Federal Register Volume 82, Issue 223 (November 21, 2017)

This document provides notice that U.S. Customs and Border Protection (``CBP'') has issued a final determination concerning the country of origin of roasted coffee. Based upon the facts presented, CBP has concluded in the final determination that Canada or the United States, i.e., the country where the raw green coffee beans are roasted, is the country of origin of the roasted coffee for purposes of U.S. Government procurement.

[Federal Register Volume 82, Number 223 (Tuesday, November 21, 2017)]
[Notices]
[Pages 55387-55388]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2017-25146]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Customs and Border Protection


Notice of Issuance of Final Determination Concerning Roasted 
Coffee

AGENCY: U.S. Customs and Border Protection, Department of Homeland 
Security.

ACTION: Notice of final determination.

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SUMMARY: This document provides notice that U.S. Customs and Border 
Protection (``CBP'') has issued a final determination concerning the 
country of origin of roasted coffee. Based upon the facts presented, 
CBP has concluded in the final determination that Canada or the United 
States, i.e., the country where the raw green coffee beans are roasted, 
is the country of origin of the roasted coffee for purposes of U.S. 
Government procurement.

DATES: The final determination was issued on November 15, 2017. A copy 
of the final determination is attached. Any party-at-interest, as 
defined in 19 CFR 177.22(d), may seek judicial review of this final 
determination within December 21, 2017.

FOR FURTHER INFORMATION CONTACT: Cynthia Reese, Valuation and Special 
Programs Branch, Regulations and Rulings, Office of Trade (202-325-
0046).

SUPPLEMENTARY INFORMATION: Notice is hereby given that on November 15, 
2017, CBP issued a final determination concerning the country of origin 
of roasted coffee which may be offered to the United States Government 
under an undesignated government procurement contract. This final 
determination, HQ H291135, was issued at the request of Keurig Green 
Mountain, under procedures set forth at 19 CFR part 177, subpart B, 
which implements Title III of the Trade Agreements Act of 1979, as 
amended (19 U.S.C. 2511-18). In the final determination, CBP has 
concluded that, based upon the facts presented, the roasting of raw 
green coffee beans substantially transforms the coffee beans into a 
product of the country where the raw green coffee beans are roasted, 
i.e. Canada or the United States, for purposes of U.S. Government 
procurement.
    Section 177.29, CBP Regulations (19 CFR 177.29), provides that 
notice of final determinations shall be published in the Federal 
Register within 60 days of the date the final determination is issued. 
Section 177.30, CBP Regulations (19 CFR 177.30), provides that any 
party-at-interest, as defined in 19 CFR

[[Page 55388]]

177.22(d), may seek judicial review of a final determination within 30 
days of publication of such determination in the Federal Register.

    Dated: November 15, 2017,
Alice A. Kipel,
Executive Director, Regulations and Rulings, Office of Trade.
HQ H291135
November 15, 2017
OT:RR:CTF:VS H291135 CMR
CATEGORY: Origin

Marian E. Ladner, Esq.
Ladner & Associates PC
420 Heights Boulevard
Houston, TX 77007
RE: U.S. Government Procurement; Title III, Trade Agreements Act of 
1979 (19 U.S.C. 2511); subpart B, Part 177, CBP Regulations; Roasted 
Coffee
Dear Ms. Ladner:
    This is in response to your request of September 29, 2017, on 
behalf of your client, Keurig Green Mountain (``Keurig''), requesting a 
final determination concerning roasted coffee for purposes of 
government procurement under Title III of the Trade Agreements Act of 
1979 (TAA), as amended (19 U.S.C. 2511 et seq.). This final 
determination concerns the country of origin of roasted coffee produced 
from raw green coffee beans roasted in Canada or the United States. As 
an importer of this merchandise, Keurig is a party-at-interest within 
the meaning of 19 CFR 177.23(a) and is entitled to request this final 
determination.
FACTS:
    The coffee will be produced from raw green coffee beans imported 
into either Canada or the United States. The green coffee beans will 
either be in their natural caffeinated state or decaffeinated. The 
decaffeination of the beans is a separate process occurring in a 
country on the Designated Country list in 48 CFR 52.225-5(a) prior to 
importation into Canada or the United States. Once imported, the green 
beans, caffeinated and decaffeinated, undergo a roasting and packaging 
process. Keurig cleans, blends and roasts the beans. A small percentage 
of beans are sprayed with flavoring ingredients. After the roasting and 
flavoring processes are complete, Keurig grinds, degasses and packages 
the coffee beans for sale. All of the processes after receipt of the 
green beans, caffeinated or decaffeinated, occur in the country of 
receipt, i.e., Canada or the United States. We note, in some cases the 
coffee will remain in bean form.
ISSUE:
    Whether the raw green coffee beans are substantially transformed by 
the roasting process for purposes of United States Government 
procurement.
LAW AND ANALYSIS:
    U.S. Customs and Border Protection (CBP) issues country of origin 
advisory rulings and final determinations as to whether an article is 
or would be a product of a designated country or instrumentality for 
the purpose of granting waivers of certain ``Buy American'' 
restrictions in United States law or practice for products offered for 
sale to the United States Government, pursuant to subpart B of Part 
177, 19 CFR 177.21 et seq., which implements Title III, Trade 
Agreements Act of 1979, as amended (19 U.S.C. 2511-2518).
    The rule of origin set forth in 19 U.S.C. 2518(4)(B) states:
    An article is a product of a country or instrumentality only if (i) 
it is wholly the growth, product, or manufacture of that country or 
instrumentality, or (ii) in the case of an article which consists in 
whole or in part of materials from another country or instrumentality, 
it has been substantially transformed into a new and different article 
of commerce with a name, character, or use distinct from that of the 
article or articles from which it was so transformed.
See also 19 CFR 177.22(a).
    In rendering advisory rulings and final determinations for purposes 
of United States Government procurement, CBP applies the provisions of 
subpart B of Part 177 consistent with the Federal Procurement 
Regulations. See 19 CFR 177.21. In this regard, CBP recognizes that the 
Federal Acquisition Regulations restrict the U.S. Government's purchase 
of products to U.S.-made or designated country end products for 
acquisitions subject to the TAA. See 48 CFR 25.403(c)(1). The Federal 
Acquisition Regulations define ``U.S.-made end product'' as:

. . . an article that is mined, produced, or manufactured in the United 
States or that is substantially transformed in the United States into a 
new and different article of commerce with a name, character, or use 
distinct from that of the article or articles from which it was 
transformed.
    See 48 CFR 25.003.
    For more than 30 years, CBP has recognized that roasting green 
coffee beans substantially transforms the beans into a new and 
different article of commerce. See Headquarters Ruling Letter (HQ) 
733563, dated June 24, 1991, citing HQ 070395, dated June 6, 1983; HQ 
722980, dated October 17, 1983; HQ 722360, dated June 6, 1984; and, HQ 
725641, dated July 25, 1984. These rulings from 1983 and 1984 concluded 
that roasting, or roasting and blending, of coffee was sufficient to 
change its character and use and thus effect a substantial 
transformation. Based on this long held position, depending on where 
the coffee beans are roasted, the roasting of the green coffee beans 
substantially transforms the coffee beans into either a product of 
Canada, or a product of the United States, for purposes of government 
procurement.
    As the decaffeination occurs prior to the roasting of the green 
beans, we see no need to address it. In addition, as all of the other 
processing, i.e., flavoring, grinding, degassing and packaging, occur 
in the same country as roasting, there is no need to address these 
additional processes. The resulting roasted coffee, ground or in bean 
form, is a product of Canada or the United States.
HOLDING:
    Based on the facts and analysis set forth above, for United States 
Government procurement purposes, the country of origin of the roasted 
coffee, in ground or bean form, is the country where the raw green 
coffee beans are roasted, i.e., Canada or the United States.
    Notice of this final determination will be given in the Federal 
Register, as required by 19 CFR 177.29. Any party-at-interest other 
than the party which requested this final determination may request, 
pursuant to 19 CFR 177.31, that CBP reexamine the matter anew and issue 
a new final determination. Pursuant to 19 CFR 177.30, any party-at-
interest may, within 30 days after publication of the Federal Register 
notice referenced above, seek judicial review of this final 
determination before the Court of International Trade.
Sincerely,

Alice A. Kipel, Executive Director
Regulations and Rulings
Office of Trade

[FR Doc. 2017-25146 Filed 11-20-17; 8:45 am]
 BILLING CODE 9111-14-P