CLA-2 OT:RR:CTF:CPM HQ H273386 NCD
Port Director, Service Port Cleveland
U.S. Customs and Border Protection
6747 Engle Road
Middleburg Heights, OH 44130
Attn: Nancy Marrano, Import Specialist
Re: Protest and Application for Further Review No. 4101-15-100591; Classification of electronic cigarette flavorings
Dear Port Director:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest No. 4101-15-100591, timely filed on October 21, 2015, on behalf of RTS Leasing, LLC (“Protestant” or “RTS”). The protest pertains to the classification of various electronic cigarette flavorings (“e-cigarette flavorings”) under the Harmonized Tariff Schedule of the United States (“HTSUS”). The subject flavorings were entered with and liquidated by U.S. Customs and Border Protection (“CBP”) at the Port of Cleveland (“the Port”). In reaching our below decision, we have taken into consideration information provided and arguments set forth in the protest and in a June 5, 2017 telephonic discussion with Protestant’s representative.
FACTS:
The instant merchandise consists of various flavoring mixtures, produced by separate manufacturers, for use with electronic cigarettes. Enclosed with the protest is a product specification sheet, issued by the manufacturer of the flavoring designated “Candle Fragrance,” indicating that the flavoring is composed 81.85% of propylene glycol, 15% of glycerin, 2% of water, 1.01% of vanilla extract (CAS No. 8024-06-4), 0.02% rose oil (CAS No. 8007-01-0), 0.01% lavender oil (CAS No. 8000-28-0), 0.02% clary sage oil (CAS No. 8016-63-5), 0.03% clove oil (CAS No. 8000-34-8), 0.02% geranium oil (CAS No. 8000-46-2), 0.01% linalool oil (CAS No. 78-70-6), 0.02% yiang yiang oil (CAS No. 8006-81-3), and 0.01% violet oil (8024-07-5).
The protest also includes 56 product information data sheets issued by another manufacturer, all of which indicate that the flavorings to which they pertain consist predominantly of propylene glycol, and that the remaining constituents are made up of various combinations of “flavoring substances,” “flavoring preparations,” triacetin, water, and “Stabilizer E433,” which denotes Polysorbate 80. The data sheets list the flavorings’ respective propylene glycol contents, and in some cases Polysorbate 80 contents, but do not otherwise account for the weights of the remaining constituents. Protestant has proffered a document, signed by the flavorings’ manufacturer, stating that the flavoring compositions cannot be disclosed but that no flavoring contains 5% or more by weight of one or more aromatic or modified aromatic substances.
The product names and propylene glycol and Polysorbate 80 contents of the flavorings described in the 56 product information data sheets are as follows:
Product Name
PG//Polysorbate 80
Product Name
PG/Polysorbate 80
Anise
90%
Lemon Sicily flavor
95%/0.5%
Apple golden flavor
78%
Lime cold pressed flavor
95%/0.5%
Apple Fuji flavor
82%
Lime distilled flavor
80%/1%
Apple pie
76%
Lychee flavor
77%
Apricot flavor
76%
Mad fruit flavor
84%
Bacon smoky flavor
94%
Mango Costa Rica flavor
98%
Beef roasted flavor
86%
Marshmallow flavor
82%
Blueberry flavor
78%
Marshmallow flavor
76%
Brandy flavor
97%
Mint crisp flavor
90%
Butterscotch flavor
76%
Mint peppermint flavor
90%
Cappuccino
88%
Oakwood flavor
63%
Cherry black flavor
84%
Peach flavor
78%
Cherry flavor
77%
Peach white flavor
94%
Chicken roasted flavor
76%
Pineapple flavor
75%
Chocolate flavor
74%
Raspberry flavor
75%
Coconut flavor
82%
Rhum Jamaica flavor
75%
Coffee espresso flavor
75%
Strawberry flavor
65%
Cola flavor
80%
Tiramisú
85%
Cookie flavor
73%
Tobacco burley flavor
85%
Catalan cream flavor
76%
Tobacco dark vapor
96%
Cream fresh flavor
77%
Tobacco desert ship flavor
82%
Cream Vienna flavor
70%
Tobacco glory
92%
Custard flavor
78%/0.2%
Tobacco Latakia flavor
86%
Grape concord flavor
77%
Tobacco Virginia flavor
85%
Grape white flavor
78%
Vanilla bourbon flavor
57%
Hazelnut roasted flavor
72%
Vanilla classic
74%
Honey flavor
65%
Violet flavor
85%
Kiwi flavor
70%
Whisky flavor
70%
Upon request by our office, Protestant submitted six representative samples of the above-listed products. Those samples, which included Cookie flavor, Marshmallow flavor, Peach flavor, Strawberry flavor, French Vanilla Ice Cream flavor, and Vanilla classic, were submitted to a CBP laboratory for an assessment as to whether any contain 5% or more aromatic or modified aromatic substances by weight. Additional details as to the composition of Vanilla classic were requested from Protestant but were not provided. Based upon the available product information and its sample analysis, the CBP laboratory issued a report (“CBP laboratory report”) stating as follows:
The product data sheets submitted were insufficiently descriptive of missing entirely and various assumptions were made based on this:
Data sheets for four of the six submitted samples were submitted (Items 1-4). No data sheet for Item 5 was submitted. A data sheet for “Classic Vanilla” was submitted for Item 6 (Vanilla) and assumed to correspond to the same product. Product data sheets list only propylene glycol quantitatively; for item 5, 75% PG (the approximate average of the various products) was assumed. Triacetin, where listed as an ingredient, was assumed to be present at 1% (w/w). Protons with chemical shifts between 6.5 and 8.5 were considered aromatic and calculations were based on vanillin (three aromatic protons, MW = 150 g/mol).
The CBP laboratory report indicates that Items 1 (Cookie flavor), Item 2 (Marshmallow flavor), Item 4 (Strawberry flavor), and Item 5 (French Vanilla Ice Cream flavor) contain aromatic or modified aromatic constituents in concentrations that may be lower than 5%, that Item 3 (Peach flavor) contains no aromatic or modified aromatic constituents, and that Item 6 (Vanilla classic) contains aromatic or modified aromatic constituents in concentrations that may be greater than 5%. The CBP laboratory report further states as follows:
Due to incompleteness of information submitted by the manufacturer/importer, the above results are preliminary and should not be considered definitive.
The subject e-cigarette flavorings were entered in three separate entries, on February 20, 2014, May 3, 2014, and September 30, 2014, in heading 3302, HTSUS, specifically subheading 3302.10.10, HTSUS, which provides for “Mixtures of odoriferous substances and mixtures (including alcoholic solutions) with a basis of one or more of these substances, of a kind used as raw materials in industry; other preparations based on odoriferous substances, of a kind used for the manufacture of beverages: Of a kind used in the food and drink industries: Not containing alcohol,” and subheading 3302.90.20, HTSUS, which provides for: Mixtures of odoriferous substances and mixtures (including alcoholic solutions) with a basis of one or more of these substances, of a kind used as raw materials in industry; other preparations based on odoriferous substances, of a kind used for the manufacture of beverages: Of a kind used in the food and drink industries: Other: Containing over 10 percent of alcohol by weight.“ CBP liquidated the subject merchandise on April 24, 2015, May 1, 2015, and August 21, 2015 in heading 3824, HTSUS, specifically subheading 3824.90.28, HTSUS, which provides for: “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: Other.” Protestant claims that the subject e-cigarette flavorings are properly classified in subheading 3824.90.92, HTSUS, which provides for: “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Other: Other: Other.”
ISSUES:
Whether the subject e-cigarette flavorings are classified in subheading 3824.90.28, HTSUS, as chemical preparations containing 5 percent or more by weight of aromatic substances, or in subheading 3824.90.92, HTSUS, as “other” chemical preparations.
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. §1514(a) (2) as a decision on classification. The protest was timely filed, within 180 days of liquidation of the first entry. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2) (B) (ii), (iii) (codified as amended at 19 U.S.C. § 1514(c) (3) (2006)). Further Review of Protest No. 4101-15-100591 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(a) because Protestant alleges that the decisions are inconsistent with a previous CBP decision with respect to substantially similar merchandise.
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and, mutatis mutandis, to GRIs 1 through 5.
The 2014 HTSUS provisions under consideration are as follows:
3824 Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included:
3824.90 Other:
Other:
Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances:
3824.90.28 Other
Other:
Other:
3824.90.92 Other
As a preliminary matter, it is undisputed that the subject e-cigarette flavorings are described as chemical preparations and are not specified or included in any heading outside of heading 3824, HTSUS. They are therefore properly classified at the 4-digit level in heading 3824, HTSUS. Solely at issue in the instant case is the classification of the e-cigarette flavorings at the 8-digit level.
Subheading 3824.90.28, HTSUS, provides for chemical mixtures that contain 5 percent or more by weight of one or more aromatic or modified aromatic substances. Additional U.S. Note 2 to Section VI sets forth the following definitions of “aromatic” and “modified aromatic” for classification purposes:
For the purposes of the tariff schedule:
The term "aromatic" as applied to any chemical compound refers to such compound containing one or more fused or unfused benzene rings;
The term "modified aromatic" describes a molecular structure having at least one six-membered heterocyclic ring which contains at least four carbon atoms and having an arrangement of molecular bonds as in the benzene ring or in the quinone ring, but does not include any such molecular structure in which one or more pyrimidine rings are the only modified aromatic rings present…
Here, the instant merchandise consists of various e-cigarette flavorings in the form of chemical mixtures. According to the corresponding product specification sheet, the flavoring designated “Candle Fragrance” is comprised 98.85% of water, glycerin, and propylene glycol, all of whose molecular structures lack the benzene rings and six-membered heterocyclic rings that are requisite components of aromatic and modified aromatic compounds, respectively. The flavoring’s remaining constituents include vanilla extract, whose molecular structure does contain a benzene ring, as well as various oils that may possibly contain aromatic or modified aromatic compounds. However, even if these constituents could all be described as aromatic, they collectively comprise only 1.15% of the flavoring’s total composition by weight. By mathematical necessity, therefore, the “Candle Fragrance” flavoring cannot be described as a mixture that contains 5 percent or more by weight of aromatic or modified aromatic substances, and is accordingly excluded from subheading 3824.90.28, HTSUS.
In contrast to the “Candle Fragrance” flavoring, the other e-cigarette flavorings are only partially described in the corresponding product information data sheets, which list only the products’ propylene glycol and Polysorbate 80 contents by weight. These data sheets do not provide the relative weights of the water, triacetin, “flavoring substances,” or “flavoring preparations.” Nor do they account for the individual chemical compounds and substances encompassed by the vague terms “flavoring substances,” and “flavoring preparations.” Despite this, the product information data sheets corresponding to the flavorings entitled “Brandy flavor,” “Lemon Sicily flavor,” “Lime cold pressed flavor,” “Mango Costa Rica flavor,” and “Tobacco dark vapor,” while wanting in detail, do provide sufficient information for a determination as to classification. Specifically, they indicate that the flavorings’ combined propylene glycol and Polysorbate 80 contents exceed 95%. Like propylene glycol, Polysorbate 80 is non-aromatic in that it lacks a benzene ring or six-membered heterocyclic ring. Because over 95% of these flavorings’ weight is thus attributable to non-aromatic substances, the flavorings cannot be described as mixtures containing 5 percent or more aromatic or modified aromatic substances by weight.
Additionally, with respect to the in the flavoring designated “Peach flavor”, the CBP laboratory report states that no aromatic or modified aromatic substances whatsoever were detected in the analysis of the flavoring. This statement is sufficiently indicative that the flavoring contains less than 5 percent aromatic of modified aromatic substances. Because that flavoring, as well as the flavorings entitled “Candle Fragrance,” “Brandy flavor,” “Lemon Sicily flavor,” “Lime cold pressed flavor,” “Mango Costa Rica flavor,” and “Tobacco dark vapor,” all contain less than 5 percent aromatic or modified aromatic substances, those products are excluded from subheading 3824.90.28, HTSUS.
However, it cannot be determined whether the remaining e-cigarette flavorings, i.e., those whose combined propylene glycol and Polysorbate 80 contents account for 95% or less of the flavorings’ total compositions, similarly fall outside the scope of subheading 3824.90.28. This is because these flavorings’ corresponding product information sheets do not indicate whether the broad descriptors “flavoring preparations” and “flavoring substances” include aromatic substances, and if so, whether the aromatic substances collectively account for 5% or more of the flavorings’ compositions. While the protest includes a signed statement attesting to the manufacturer’s inclusion of less than 5% non-aromatic substances in its flavoring formulations, this is insufficient in the absence of complete, verifiable descriptions of the flavorings’ constituents. CBP has endeavored to independently ascertain the flavorings’ contents by analyzing six representative samples, but due to the lack of detailed product information to guide this analysis, was unable to reach conclusive results as to five of the six samples. The non-detection of aromatic or modified aromatic substances in the Peach flavor establishes that that particular flavoring is excluded from subheading 3824.90.28, HTSUS, but cannot otherwise be extrapolated to the remaining flavorings.
In the absence of credible indicia as to the remaining flavorings’ contents, we find that Protestant has not met its burden of establishing that the entirety of the flavorings are excluded from subheading 3824.90.28, HTSUS. See Rollerblade, Inc. v. United States, 282 F.3d 1349, 1352 (Fed. Cir. 2002) (“Under 28 U.S.C. § 2639(a)(1), ‘a classification of merchandise by Customs is presumed to be correct’…Thus, ‘the burden of proof is upon the party challenging the classification.’”); see also Headquarters Ruling Letter (HQ) HQ H068277, dated December 30, 2010; H032676, dated May 20, 2010; and HQ 967512, dated November 23, 2005 (applying this principle to CBP’s review of protests). With that being the case, we conclude that the flavorings other than those entitled “Candle Fragrance,” “Brandy flavor,” “Lemon Sicily flavor,” “Lime cold pressed flavor,” “Mango Costa Rica flavor,” “Tobacco dark vapor,” and “Peach flavor” are classified in subheading 3824.90.28, HTSUS.
Because some, although not all, of the subject e-cigarette flavorings are excluded from subheading 3824.90.28, we consider subheading 3824.90.92, HTSUS, which provides for “other” chemical preparations. Subheading 3824.90.92 is a “basket” provision, in which articles can be classified only if they are not described more specifically elsewhere within the heading or the broader HTSUS. See Deckers Outdoor Corp. v. United States, 844 F. Supp. 2d 1324, 1331, aff’d 714 F.3d 1363 (Fed. Cir. 2013) (characterizing “other” subheading as a basket provision “which may only be employed if the merchandise is not covered by the more specific subheading's terms”). Here, because the flavorings designated “Candle Fragrance,” “Brandy flavor,” “Lemon Sicily flavor,” “Lime cold pressed flavor,” “Mango Costa Rica flavor,” “Tobacco dark vapor”, and “Peach flavor” are not described by subheading 3824.90.28, by any other subheading of heading 3824, or by any other provision within the broader Nomenclature, they are classified in subheading 3824.90.92, HTSUS. As Protestant asserts, this determination is consistent with New York Ruling Letter (NY) N263611, dated May 7, 2015, in which a product identical in chemical composition to the “Candle Fragrance” flavoring was classified in subheading 3824.90.92.
Protestant contends that NY N263611 supports classification of all the subject e-cigarette flavorings in subheading 3824.90.92, HTSUS. However, that ruling involved a flavoring which, like the identical “Candle Fragrance” flavoring and the flavorings with at least 95% non-aromatic content, clearly contained less than 5% aromatic or modified aromatic substances. In contrast, the remaining flavorings, whose chemical compositions remain unidentified, may very well contain 5% or more aromatic or modified aromatic substances by weight. As such, NY N263611 does not necessitate classification of those flavorings in subheading 3824.90.92.
HOLDING:
By application of GRIs 1 and 6, the electronic cigarette flavorings entitled “Candle Fragrance,” “Brandy flavor,” “Lemon Sicily flavor,” “Lime cold pressed flavor,” “Mango Costa Rica flavor,” “Tobacco dark vapor”, and “Peach flavor” are classified in heading 3824, HTSUS, specifically subheading 3824.90.9295, HTSUSA (Annotated), which provides for: “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Other: Other: Other.” The general column one rate of duty is 5.0% ad valorem.
By application of GRIs 1 and 6, the remaining electronic cigarette flavorings are classified in heading 3824, HTSUS, specifically in subheading 3824.90.2800, HTSUSA, which provides for: “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: Other.” The general column one rate of duty is 6.5% ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at www.usitc.gov/tata/hts/.
You are instructed to ALLOW the protest in part and DENY the protest in part.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP website at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division