CLA-2 RR:CR:GC 960694 RC

Maureen Pearson, Esq.
Katten, Muchin, & Kavis
525 West Monroe Street
Chicago, Illinois 60661-3693

RE: White dipping icing, donut glaze, and chocolate dipping icing

Dear Ms. Pearson:

This is in response to letters dated May 23 and June 23, 1997, submitted on behalf of Kerry Ingredients, concerning the classification of white dipping icing, donut glaze, and chocolate dipping icing under the Harmonized Tariff Schedule of the United States (HTSUS). On January 8, 1998, you, your client, and an associate met with Headquarters personnel to discuss this matter. In addition, your office made subsequent submissions that were considered.

FACTS:

The white dipping icing consists of water, sugar, agar-agar, dextrose, partially hydrogenated soy oil, corn syrup 63 DE, salt, sodium propionate, mono+diglyceride emulsifier, lecithin, vanilla flavor, potassium sorbate, titanium dioxide, and citric acid. The donut glaze consists of water, sugar, agar-agar, salt, mono+diglyceride emulsifier, propylene glycol, cellulose gum, potassium sorbate, citric acid, and maltodextrin 5 DE. The chocolate dipping icing consists of water, sugar, dextrose, agar-agar, partially hydrogenated soy oil, natural process cocoa, corn syrup 63 DE, salt, sodium propionate, lecithin, potassium sorbate, and vanilla flavor.

All of the products contain over 65 percent by dry weight of sugar. Made in Canada, the products will be imported in ready-to-use condition in either one-/or five-gallon pails or in 10 kg laminated-plastic pouches. The products will be used in the imported condition, without further processing or heating, to frost or glaze donuts and other bakery goods by dipping the baked good in the icing or glaze. The products will be used by commercial bakeries and foodservice establishments in the United States.

ISSUE:

What is the proper tariff classification for the white dipping icing, donut glaze, and chocolate dipping icing, described above, under the HTSUS?

LAW AND ANALYSIS:

Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI's). The systematic detail of the HTSUS is such that virtually all goods are classified by application of GRI 1, that is, 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 GRI's may then be applied. GRI 6 provides that the GRI's apply in the same fashion to subheadings within the same heading.

The Harmonized Commodity Description and Coding System Explanatory Notes (EN's) constitute the official interpretation of the HTSUS. While not legally binding, and therefore not dispositive, the EN's provide a commentary on the scope of each heading of the HTSUS and are thus useful in ascertaining the proper classification of merchandise under the System. Customs believes the EN's should always be consulted. See, T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

Additional U.S. Notes 2 and 3 to chapter 17, HTSUS, read as follows:

2. For the purposes of this schedule, the term "articles containing over 65 percent by dry weight of sugar described in additional U.S. note 2 to chapter 17" means articles containing over 65 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, capable of being further processed or mixed with similar or other ingredients, and not prepared for marketing to the ultimate consumer in the identical form and package in which imported.

3. For the purposes of this schedule, the term "articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17" means articles containing over 10 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, except (a) articles not principally of crystalline structure or not in dry amorphous form, the foregoing that are prepared for marketing to the ultimate consumer in the identical form and package in which imported; (b) blended syrups containing sugars derived from sugar cane or sugar beets, capable of being further processed or mixed with similar or other ingredients, and not prepared for marketing to the ultimate consumer in the identical form and package in which imported; (c) articles containing over 65 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, capable of being further processed or mixed with similar or other ingredients, and not prepared for marketing to the ultimate consumer in the identical form and package in which imported; or (d) cake decorations and similar products to be used in the same condition as imported without any further processing other than the direct application to individual pastries or confections, finely ground or masticated coconut meat or juice thereof mixed with those sugars, and sauces and preparations therefor.

You argue that the chocolate dipping icing is classified in subheading 1806.20.9900, HTSUS, and that the white dipping icing and donut glaze are classified in subheading 2106.90.9997, HTSUS. It is your opinion that the articles do not fall into the tariff rate quotas described by chapter 17, Additional U.S. Notes 2 or 3, because the toppings are ready to use and, therefore, are not "capable of being further processed or mixed with similar or other ingredients," as required by chapter 17 Additional U.S. Note 2. In the alternative, you argue that, as pastry toppings, the articles fall within the "cake decorations" exception to the quota of chapter 17 Additional U.S. Note 3.

It is undisputed that the toppings contain over 65 percent by dry weight of sugar and that they are not prepared for marketing to the ultimate consumer in the identical form and package in which they are imported (per Additional U.S. Note 2(d) of Section IV, HTSUS, the bakeries and food service establishments to which the products at issue will be sold are not "ultimate consumers"). The remaining issue, pursuant to Additional U.S. Note 2, is whether the toppings are "capable of being further processed or mixed with similar or other ingredients."

According to Section IV, Additional U.S. Note 2(b) "the term capable of being further processed or mixed with similar or other ingredients' means that the imported product is in such condition or container as to be subject to any additional preparation, treatment or manufacture or to be blended or combined with any additional ingredient, including water or any other liquid, other than processing or mixing with other ingredients performed by the ultimate consumer prior to consumption of the product."

The word "ingredient" is not specifically defined in the tariff schedule. A tariff term that is not defined in the HTSUS or in the EN's is construed in accordance with its common and commercial meaning. Nippon Kogaku (USA) Inc. v. United States, 69 CCPA 89, 673 F.2d 380 (1982). Common and commercial meaning may be determined by consulting dictionaries, lexicons, scientific authorities and other reliable sources. C.J. Tower & Sons v. United States, 69 CCPA 128, 673 F.2d 1268 (1982). According to Webster's Ninth New Collegiate Dictionary (1991), the term "ingredient" is defined as "something that enters into a compound or is a component part of any combination or mixture." (Emphasis supplied). The toppings and the "untopped" donuts, pastries, or cakes are components combined to make finished goods. Therefore, we find that the toppings are capable of being combined with additional ingredients, to wit, donuts, pastries, or cakes.

Accordingly, we find that the toppings are subject to Additional U.S. Note 2. Therefore, Additional U.S. Note 3 (and its exceptions) do not apply to the products at issue.

You also argue that the holding in Wilsey Foods, Inc., v. United States, Slip Op. 94-46 (Ct. Int'l Trade, decided March 16, 1994), should apply, here. We disagree. In Wilsey, the court addressed the tariff classification of products used to coat confections and/or pastries that contained between 39-45 percent sugar, products to which chapter 17 Additional U.S. Note 2 could not have applied. The Wilsey case is thus inapplicable because all of the toppings at issue here contain more than 65 percent sugar. With respect to the Customs rulings you cite, we note that HQ 956246 (July 24, 1994) and HQ 956100 (February 7, 1995) also pertain to articles containing less than 65 percent sugar. Additionally, we note that the rulings cited that were issued prior to 1995 have been modified by operation of law, when Section IV Additional U.S. Note 2 and chapter 17 Additional U.S. Notes 2 and 3 were adopted in 1995. Lastly, with respect to NY 813028 (August 9, 1995), the ruling (pertaining to sugar flowers) did not indicate how the goods would be packaged when imported, that is, for the "ultimate consumer" or in bulk. We will further examine NY 8l3028 and modify or clarify it, as appropriate.

The instant white dipping icing and donut glaze toppings are similar to the bakers' wares ruled upon in NY A89108, dated November 14, 1996. There, Customs classified toppings, containing 80 percent sugar, in subheading 2106.90.9400, HTSUS. Likewise, the white dipping icing and donut glaze, here, are classifiable in subheading 2106.90.9400, HTSUS. Following the same classification analysis as for the white dipping icing and donut glaze, the chocolate dipping icing, containing 5.3 percent cocoa, is classifiable in subheading 1806.20.7300, HTSUS.

We have coordinated our efforts with the Foreign Agricultural Service of the Department of Agriculture. In a letter dated March 17, 1998, that office expressed agreement with the findings set forth in this ruling.

HOLDING:

The white dipping icing and donut glaze are classifiable in subheading 2106.90.9400, HTSUS, the provision for "Food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Articles containing over 65 percent by dry weight of sugar described in Additional U.S. Note 2 to chapter 17: Other, dutiable at the general column one rate of 30.5 cents per kilogram, plus 9 percent ad valorem.

The chocolate dipping icing is classifiable in subheading 1806.20.7300, HTSUS, the provision for "Chocolate and other food preparations containing cocoa: Other preparations in blocks, slabs or bars, weighing more than 2 kg or in liquid, paste, powder, granular or other bulk form in containers or immediate packings, of a content exceeding 2 kg: Other: Containing more than 65 percent by weight of sugar: Other: Articles containing over 65 percent by dry weight of sugar described in Additional U.S. Note 2 to chapter 17: Other, dutiable at the general column one rate of 32.3 cents per kilogram, plus 9 percent ad valorem.

Sincerely,

John Durant, Director,
Commercial Rulings Division