CLA-2:CO:R:C:G 087089
Mr. Mark T. Land
Boiron Borneman
1208 Amosland Road
Norwood, PA 19074
RE: Modification of Headquarters Ruling Letter 081662; Sugar
pellets
Dear Mr. Land:
In Headquarters Ruling Letter (HRL) 081662, dated September
19, 1988, you received, on your behalf, a ruling on the
classification of sugar pellets produced in France. In that
ruling the products at issue were to be classified in subheading
2106.90.50, of the Harmonized Tariff Schedule of the United
States Annotated (HTSUSA), subsequent to the implementation of
the Harmonized System. That subheading provides for food
preparations not elsewhere specified or included: other: subject
to quotas established pursuant to Section 22 of the Agricultural
Adjustment Act, as amended. Pursuant to 177.9 of the Customs
Regulations (19 C.F.R. 177.9), we are modifying HRL 081662.
FACTS:
The sugar pellets consist of 85 percent sucrose and 15
percent lactose. The pellets are stated to have an imported cost
of $2.37 per pound, and are small spheres of about 2 mm in size
and with a mass of about 50 mg. The product will be imported in
bulk for use as a base or carrier for pharmaceutical products.
ISSUE:
What is the correct classification for the sugar pellets?
LAW AND ANALYSIS:
Modification
Our regulations allow for the modification or revocation of
ruling letters. As stated in 19 C.F.R. 177.9(d)(1), "[a]ny
ruling letter found to be . . . not in accordance with the
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current views of the Customs Service may be modified or revoked.
Modification or revocation shall be effected by Customs
Headquarters by giving notice to the person to whom the ruling
letter was addressed . . . ." As provided in 177.9(d)(2),
"[t]he modification or revocation of a ruling letter will not be
applied retroactively with respect to the person to whom the
ruling was issued, or to any person directly involved in the
transaction to which that ruling related . . . ."
Classification
Classification of goods under the HTSUSA is governed by the
General Rules of Interpretation (GRI's), taken in order. When
goods are prima facie classifiable under two or more headings GRI
3 is applicable. In this case classification is determined by
application of GRI 3(b) which provides in pertinent part:
Mixtures . . . shall be classified as if they
consisted of the material which gives them their
essential character.
In general, essential character has been construed to mean
the attribute which strongly marks or serves to distinguish what
an article is; that which is indispensable to the structure, core
or condition of the article. In addition, the Explanatory Notes
provide further factors which help determine the essential
character of goods. Factors such as bulk, quantity, weight or
value, or the role of a constituent material in relation to the
use of the goods are to be utilized, though the importance of
certain factors will vary between different kinds of goods.
The sugar would impart the essential character of the
product at issue. Not only is the sugar the overwhelmingly main
ingredient in terms of percentages, it also is the ingredient
which is the core of the article. Though the product will be
used, subsequent to importation, as a carrier for
pharmaceuticals, "[i]t is well settled that, . . ., imported
merchandise must be classified with reference to its condition
when imported." United States v. Citroen, 223 U.S. 407, 32 S.Ct.
256, 56 L. Ed. 486 (1911). "Condition as imported refers to the
condition of the goods when they are brought within the
jurisdiction of the United States with intent to unlade." The
Sherwin-Williams Co. v. United States, 38 CCPA 13, 18, C.A.D.
432 (1950). Therefore the headings for sugar would be the proper
classification for the product at issue.
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HOLDING:
The product at issue, sugar pellets from France, is properly
classified in subheading 1701.99.00, HTSUSA, which provides for
cane or beet sugar and chemically pure sucrose, in solid form:
other: other. Under this subheading the merchandise is subject
to the quota and fees provided in additional U.S. Note 3 to
Chapter 17, HTSUSA. The rate of duty is 1.4606 cents per
kilogram, less 0.020668 cents per kilogram for each degree under
100 degrees (and fractions of a degree in proportion) but not
less than 0.943854 cents per kilogram.
HRL 081662, is hereby modified pursuant to 177.9 of the
Customs Regulations. While the modification is effective
immediately, it is prospective in nature, and there is no effect
on previous Customs transactions.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc: ADNY
1cc: Legal Ref.
1cc: John Durant
1cc: David I. Wilson, Esquire
Baker & Hostetler
Washington Square, Suite 1100
1050 Connecticut Avenue, N.W.
Washington, D.C. 20036