CLA-2 OT:RR:CTF:FTM H285620 GaK
TARIFF NO: 2103.90.90
Dave Pentland
Carson Customs Brokers (USA) Inc.
925 Boblett Street, Bldg. B
Blaine, WA 98230
RE: Revocation of NY N283364; Classification of Greek yogurt dips from Canada
Dear Mr. Pentland:
This letter is to inform you that U.S. Customs and Border Protection (“CBP”) has reconsidered New York Ruling Letter (“NY”) N283364, which was issued to Carson Customs Brokers on March 13, 2017. In NY N283364, CBP classified four various flavors of Sabra® brand Greek Yogurt Dips (“merchandise”) under subheading 0406.10.84, Harmonized Tariff Schedule of the United States (“HTSUS”), which provides for: “[c]heese and curd: Fresh (unripened or uncured) cheese, including whey cheese, and curd: Other: Other: Other: Other cheese and substitutes for cheese (except cheese not containing cow’s milk, and soft ripened cow’s milk cheese): Described in additional U.S. note 16 to this chapter and entered pursuant to its provisions.” We have reviewed NY N283364 and found it to be incorrect. For the reasons set forth below, we are revoking this ruling.
On September 26, 2018, pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1), as amended by section 623 of Title VI, notice of the proposed action was published in the Customs Bulletin Vol. 52, No. 39. No comments were received in response to this notice.
FACTS:
In NY N283364, the merchandise was described as follows:
The subject merchandise is [three] various flavors of Sabra® brand Greek Yogurt Dip. Farmer’s Ranch is composed of yogurt (cultured skim milk, cream, milk protein), carrot, cucumber, celery, canola oil, onions, salt, onion powder, spices, chives, parsley, garlic powder, sugar, pectin, cultured dextrose, cultured skim milk, potassium sorbate (added to maintain freshness), natural flavors, sodium citrate, and citric acid.
Tzatziki is composed of yogurt (cultured skim milk, cream, milk protein), cucumber, garlic, canola oil, onions, parsley, dill, spices, salt, sugar, pectin, cultured dextrose, cultured skim milk, potassium sorbate (added to maintain freshness), natural flavors, sodium citrate, and citric acid.
Spinach Parmesan is composed of yogurt (cultured skim milk, cream, milk protein), spinach, onions, canola oil, salt, garlic, sugar, parmesan cheese, pectin, cultured dextrose, cultured skim milk, natural flavors, potassium sorbate (added to maintain freshness), sodium citrate, and citric acid.
Each of the products contain 18 percent milk fat and will be packed in plastic containers (six per case) with a net weight of 283 grams and 680 grams, respectively.
You also submitted, at our request, a flowchart of the manufacturing process of the Greek Yogurt, which serves as the base for the merchandise prior to addition of the other ingredients, such as vegetables, herbs, and spices.
ISSUE:
Whether the merchandise is classified under heading 0406, HTSUS, as “[c]heese and curd,” or heading 2103, HTSUS, as “[s]auces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard”?
LAW AND ANALYSIS:
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. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the heading and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
The 2018 HTSUS headings at issue are as follows:
0406 Cheese and curd
* * *
2103 Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard
Heading 0406, HTSUS, provides for cheese and curd. Fresh cheese is produced with pasteurized milk, whereas for the production of yogurt, the milk is subjected to higher-temperature heat treatment to ensure the retention of whey. During cheese production, milk-clotting enzyme is added to coagulate the milk and separate the liquid (whey) from the milk solids (curds). The production of the merchandise at issue does not involve a straining process and all of the dairy ingredients, including the whey, are stated to remain in the formula. Therefore, the merchandise cannot be classified as cheese under heading 0406, HTSUS.
The Explanatory Notes (“EN”s) to the Harmonized Commodity Description and Coding System constitute the official interpretation of the Harmonized System at the international level. Though not dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS. Customs believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989).
Heading 2103, HTSUS, provides for sauces and preparations therefore.
ENs to 21.03(A) provides as follows:
…
The heading also includes certain preparations, based on vegetables or fruit, which are mainly liquids, emulsions or suspensions, and sometimes contain visible pieces of vegetables or fruit. These preparations differ from prepared or preserved vegetables and fruit of Chapter 20 in that they are used as sauces, i.e., as an accompaniment to food or in the preparation of certain food dishes, but are not intended to be eaten by themselves.
* * *
In Nestle Refrigerated Food Co v. United States, 18 C.I.T. 661, 668 (1994), the court concluded that the common meaning of “other tomato sauces” is based on the common meaning of the term “sauce.” The Nestle court stated “[i]n 1894, the U.S. Supreme Court reviewed the common meaning of the term “sauce” and determined that: ‘[t]he word “sauce,” as commonly used, designates a condiment, generally but not always of liquid form, eaten as an addition to and together with a dish of food, to give it flavor and make it more palatable; and is not applied to anything which is eaten, alone or with a bit of bread, either for its own sake only, or to stimulate the appetite for other food to be eaten afterwards.” Id. at 668 (citations omitted).
The court in Nestle, following the seminal decision Bogle v. Magone, 152 U.S. 623, 625-26 (1894) (subsequently followed by Del Gaizo Distrib. Corp. v. United States, 24 C.C.P.A. 64, T.D. 48,376 (1936)) and its progeny, determined that in ascertaining whether a product fits within the common meaning of sauce, the court will “examine a variety of key features, including its ingredients, flavor, aroma, texture, consistency, actual and intended use, and marketing.” See, e.g., Neuman & Schwiers Co., 18 C.C.P.A. at 3. “Whether a product is fit for use as a sauce depends upon more than the mere possibility of use; rather, substantial actual use as a sauce must be demonstrated.” See Wah Shang Co. v. United States, 44 C.C.P.A. 155, 159, C.A.D. 654 (1957). Also, according to Nestle, a product's physical features are also considered in light of their effect on the product’s ability to be used as a sauce.
The merchandise at issue mainly consist of cream (18% milk fat and 25% total solids). The ranch product formula consists of 45% cream, 33% ultra-filtered milk with 85 percent moisture level (“UF 85”), 7% carrots, 5% cucumber, 2% non-fat dried milk (“NFDM”), 2% celery, 2% canola oil, 1% yellow onions, 1% salt, and less than 1% of ranch flavor, onion powder, umami powder, black pepper, pectin, xanthan, citric acid, dried chives, parsley flakes, garlic powder, sorbate, and culture. The tzatziki formula consists of 48% cream, 34% UF 85, 11% cucumber, 2% NFDM, 1% garlic paste, less than 1% of canola oil, yellow onions, garlic, salt, dill weed, cucumber flavor blend, dry dill weed, parsley, pectin, citric acid, white pepper, sugar, and potassium sorbate. The spinach Parmesan formula consists of 38% cream, 27% UF 85, 18% spinach, 6% yellow onions, 5% parmesan cheese, 2% NFDM, 2% canola oil, less than 1% of salt, water, garlic, feta cheese, citric acid, pectin, sorbate, and culture.
In this instance, we find that in its condition as imported, the merchandise is materially similar to products previous found to be classified in heading 2103 and is within the class or kind of goods used as a sauce. In accordance with the ENs to 21.03, the merchandise mainly consists of cream and milk and has liquid character, although with visible pieces of vegetables. See HQ W968353, dated August 1, 2007 (Tzatziki garlic dip consisted of 85% cream, 10% cucumber, and 4% vegetable oil); NY H81014, dated May 29, 2001 (garlic dip consisted of 89% margarine, 7% garlic, 1% whey powder, and less than 1% each of salt, skim milk powder, “Butter Buds,” Worcestershire sauce, “N Lite D,” black pepper, parsley flakes, and chicken base); and NY J81714, dated March 20, 2003 (blue cheese dressing consisted of 50% vegetable oil, 27% water, 9.8% vinegar, 3.2% blue cheese, 2.4% whey powder, 1.9% egg yolk, 1.7% each of modified corn starch and salt, one percent sugar, and less than one percent flavoring, citric acid, pepper, and preservatives).
Therefore, we find that under GRI 1, the Sabra® brand Greek Yogurt Dips are described by heading 2103, HTSUS, specifically subheading 2103.90.90, which provides for “[s]auces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Other: Other: Other.”
HOLDING:
Under the authority of GRIs 1 and 6, the Sabra® brand Greek Yogurt Dips are provided for in heading 2103, HTSUS, specifically in subheading 2103.90.90, HTSUS, which provides for, “[s]auces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Other: Other: Other.” The 2018 column one general rate of duty is 6.4% ad valorem.
EFFECT ON OTHER RULINGS:
NY N283364, dated March 13, 2017, is hereby REVOKED.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division