OT:RR:CTF:FTM H333793 MJD
Mr. Yunming Gu
Wismettac Asian Foods, Inc.
13409 Orden Dr.
Santa Fe Springs, California 90670-6336
RE: Tariff Classification and Country of Origin of Strawberry Mochi
Dear Mr. Gu,
This is in response to your request, dated July 5, 2023, on behalf of Wismettac Asian Foods, Inc., for a binding ruling regarding the tariff classification and country of origin of strawberry mochi under the Harmonized Tariff Schedule of the United States ("HTSUS"). The request was forwarded to this office by the National Commodity Specialist Division for a response. Our ruling is set forth below.
Within the request for a binding ruling, the requestor asked that the percentages of ingredients in connection with this request be treated as confidential. Inasmuch as this request conforms to the requirements of 19 C.F.R. 177.2(b)(7), the request for confidentiality is approved. The information contained within brackets in this decision will not be released to the public and will be withheld from published versions of this decision.
FACTS:
The subject merchandise is "strawberry mochi," which is round in shape and strawberry pink in color. The strawberry mochi contains the following ingredients:
|Percentage of Ingredient: |Ingredient: |Country of Origin of Ingredient: |
|[***] |Maltose |Taiwan |
|[***] |Sugar |Thailand |
|[***] |Glutinous Rice |Thailand |
|[***] |Hydroxypropyl Distarch Phosphate (E1442) |Thailand |
|[***] |Palm oil |Malaysia |
|[***] |Wax Gourd |Taiwan |
|[***] |Strawberry Juice |Taiwan |
|[***] |Trehalose |China |
|[***] |Gelatin |Brazil |
|[***] |Strawberry Flavor |Taiwan |
|[***] |Sorbitol (E420) (Sweetener) |Taiwan |
|[***] |FD&C Red No. 40 (E129) |Denmark |
|[***] |Monoglycerides and Diglycerides (E471) (Emulsifier) |Japan |
|[***] |Potassium Sorbate (E202) (Preservative) |Germany |
In Taiwan, the raw materials, i.e., maltose, sugar, glutinous rice, hydroxypropyl distarch phosphate (E1442), palm oil, wax gourd, and strawberry juice are stored at 35 degrees Celsius after undergoing quality control. Then they are weighed, steamed at 112 degrees Celsius, mixed, and stirred. Afterwards, the various additives, i.e., trehalose, gelatin, strawberry flavor, sorbitol (E420) (sweetener), FD&C Red No. 40 (E129), monoglycerides and diglycerides (E471) (emulsifier), and potassium sorbate (E202) (preservative) are prepared and added to the mixture. The mixture is shaped into round balls and becomes the final product. One individual bag contains 8 strawberry mochis and has a net weight of 216 g. Each outer box has 12 individual bags and a total gross weight of 3.2 kg.
The strawberry mochi is exported from Taiwan in an ambient state and sold mainly in bulk to Asian supermarkets and restaurants. According to the requestor, the strawberry mochi is intended to be consumed as a snack or sweet and is sold in the dessert section of stores alongside other confectioneries.
ISSUE:
(1) What is the tariff classification of the strawberry mochi?
(2) What is the country of origin of the strawberry mochi?
LAW AND ANALYSIS:
Classification
Classification under the HTSUS is made in accordance with the General Rules of Interpretation ("GRIs"). GRI 1 provides that the classification of goods shall be determined 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 GRIs 2 through 6 may then be applied in order.
The 2024 HTSUS provision under consideration are as follows:
1704: Sugar confectionery (including white chocolate), not containing cocoa:
1704.90: Other:
Confections or sweetmeats ready for consumption:
Other:
1704.90.35 Other
* * *
The Harmonized Commodity Description and Coding System Explanatory Notes ("EN") constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of [the] proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
EN 17.04 provides, in relevant part, that:
This heading covers most of the sugar preparations which are marketed in a solid or semi-solid form, generally suitable for immediate consumption and collectively referred to as sweetmeats, confectionery or candies.
* * *
The product at issue is strawberry mochi. The strawberry mochi is made from steaming and mixing maltose, sugar, glutinous rice, hydroxypropyl distarch phosphate (E1442), palm oil, wax gourd, and strawberry juice. Then various additives such as trehalose, gelatin, strawberry flavor, sorbitol (E420) (sweetener), FD&C red no. 40 (E129), monoglycerides and diglycerides (E471) (emulsifier), and potassium sorbate (E202) (preservative) are prepared and added to the mixture. The mixture is shaped into round balls and becomes the final product. The strawberry mochi is imported in an ambient state and sold mainly in bulk to Asian supermarkets and restaurants. It is intended to be consumed as a snack or sweet and sold in the dessert section of stores alongside other confectioneries.
CBP has previously classified similar products to the strawberry mochi in heading 1704, HTSUS, which provides for "Sugar confectionery (including white chocolate), not containing cocoa." The ENs to heading 1704, HTSUS, provide that "[this] heading covers most of the sugar preparations which are marketed in a solid or semi solid form, generally suitable for immediate consumption and collectively referred to as sweetmeats, confectionery or candies."
For example, in Headquarters Ruling Letter ("HQ") H200575, dated April 16, 2012, CBP classified Kellogg's Rice Krispies Treats in heading 1704, HTSUS. The Kellogg's Rice Krispies Treats contained "approximately 35% of medium grained milled rice and a combined sugar content over 50%, which includes corn syrup, fructose, fine granulated sugar, corn syrup solids, dextrose and high fructose corn syrup." In classifying the product in heading 1704, HTSUS, CBP established that the Kellogg's Rice Krispies Treats were a sugar confectionary stating that "CBP has consistently taken the position that a confection is a product that, in its condition as imported, is ready for consumption at retail as a confectionery, is marketed as such, and is not an ingredient of another food." See HQ H2500575 (citing to HQ 086101, dated February 27, 1990 (peanut flavored chips); HQ 085206, dated February 23, 1990 (white chocolate in 5 kg blocks); HQ 955580, dated July 30, 2002 and HQ 965211, dated August 1, 2002 (chocolate fish); HQ H027857, dated August 8, 2008 (small marshmallows); and HQ H047555, dated March 19, 2010 (goat milk caramel lollipop)). As a result, CBP provided that "the Rice Krispies Treats are sweet-tasting articles eaten for their sweetness, composed mostly of sugar, are ready for consumption, are viewed by Kellogg as a confectionery, and are marketed and sold as snacks, the Treats belong to the class or kind of goods that are considered confectioneries."
Likewise, in HQ 963764, dated January 11, 2002, CBP classified Certs Cool Mint Drops in heading 1704, HTSUS. In making that determination, CBP stated that the Certs Cool Mint Drops were "marketed as mints," explaining that "[m]ints are confectioneries" and that they are "sold with other candies at newspaper stands, pharmacies and supermarkets." Moreover, CBP emphasized that the Certs Cool Mint Drops consist essentially of sugar. Like the Kellogg's Rice Krispies Treats in H200575 and the Certs Cool Mint Drops in in HQ 963764, the strawberry mochi in this case is composed mostly of sugar. Sugar is the greatest ingredient overall, with the glutinous rice coming in second. In fact, the amount of sugar in the strawberry mochi surpasses, and more than doubles, the amount of rice in the product. Moreover, the strawberry mochi is ready for consumption as a confectionary, viewed by the importer as a confectionary, and sold in the market with other confectionaries and sweets similar to the Kellogg's Rice Krispies Treats in H200575 and the Certs Cool Mint Drops in in HQ 963764, which were ultimately classified in heading 1704, HTSUS. Therefore, we find that the strawberry mochi is classified in heading 1704, HTSUS, and specifically subheading 1704.90.35, HTSUS, which provides for "Sugar confectionery (including white chocolate), not containing cocoa: Other: Confections or sweetmeats ready for consumption: Other: Other."
Country of Origin
Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that unless excepted, every article of foreign origin imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States, the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was "that the ultimate purchaser should be able to know by an inspection of the marking on the imported goods the country of which the goods is the product. The evident purpose is to mark the goods so that at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will." United States v. Friedlander & Co., 27 C.C.P.A. 297 at 302; C.A.D. 104 (1940) (emphases added).
Part 134, U.S. Customs and Border Protection ("CBP") Regulations (19 C.F.R. Part 134) implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.1(b) defines "country of origin" as:
[T]he country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin" within the meaning of [the marking regulations]...
A substantial transformation is said to have occurred when an article emerges from a manufacturing process with a name, character, or use that differs from the original material subjected to the process. M.B.I. Merchandise Industries, Inc. v. United States, 16 C.I.T. 495, 502 (1992) (citing United States v. Gibson-Thomsen Co., 27 C.C.P.A. 267, 270 (C.A.D. 98) (1940)). The question of whether a substantial transformation occurs for marking purposes is a question of fact, to be determined on a case-by-case basis. National Hand Tool Corp. v. United States, 16 C.I.T. 308, 311 (1992) (quoting Uniroyal Inc. United States, 3 C.I.T. 220 (1982), aff'd, 702 F.2d 1022 (Fed. Cir. 1983)). In addition, mixing is a simple operation that only substantially transforms something if the ingredients mixed create a commodity that is different in name, character, and use from the original ingredients. See, e.g., National Juice Prods. Ass'n v. United States, 10 C.I.T. 48 (1986). See also CPC Int'l v. United States, 21 C.I.T. 784; 971 F. Supp. 574; 19 Int'l Trade Rep. (BNA) 1887; 1997 Ct. Intl. Trade LEXIS 106 (Ct. Int'l Trade 1997).
CBP, has also addressed whether mixing food ingredients together results in a substantial transformation. For example, in New York Ruling Letter ("NY") N333285, dated June 29, 2023, CBP found that the country of origin of "Kimchee Sauce" made from various ingredients from different countries was substantially transformed in Japan where it was manufactured. In Japan, the raw materials were mixed together with seasoning and packaged. In making that determination, CBP stated that "the mixture of pre-formulated ingredients to create the finished sauce result[ed] in a substantial transformation of the raw materials. The ingredients have lost their separate identities and have become an integral part of a new product, a food preparation." Therefore, CBP found that the product had a new "name, character or use" as a result of mixing all of the ingredients in Japan. Accordingly, the country of origin of the "Kimchee Sauce" was Japan.
Similarly, in N217299, dated June 4, 2012, CBP found the country of origin of two dairy products from Singapore made with ingredients from Singapore, the United States, and other various countries to be Singapore where all of the ingredients were mixed together and packaged. CBP stated that mixing the ingredients together resulted in a substantial transformation. Specifically, CBP stated that "[t]he ingredients lost their separate identities and became an integral part of a new product" due to the mixing of the ingredients in Singapore.
The strawberry mochi is similar to the "Kimchee Sauce" in NY N333285, and the two dairy products in NY N21729 mentioned above. The strawberry mochi made from Taiwanese ingredients and other ingredients from various countries is substantially transformed in Taiwan where all of its ingredients are mixed together and shaped into round balls to become the final product. When all of the ingredients are mixed together in Taiwan, they lose their separate identities and become a new product, strawberry mochi. Therefore, we find that the strawberry mochi is substantially transformed in Taiwan and is thus a product of Taiwan.
HOLDING:
By application of GRIs 1 and 6, we find that the strawberry mochi is classified under heading 1704, HTSUS, and specifically subheading 1704.90.35, HTSUS, which provides for "Sugar confectionery (including white chocolate), not containing cocoa: Other: Confections or sweetmeats ready for consumption: Other: Other: Other." The 2024 column one, general rate of duty is 5.6% ad valorem.
The country of origin of the strawberry mochi is Taiwan.
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 online at: https://hts.usitc.gov.
Please note that 19 C.F.R. 177.9(b)(1) provides that "[e]ach ruling letter is issued on the assumption that all of the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. The application of a ruling letter by a CBP field office to the transaction to which it is purported to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transaction described therein to the actual transaction, and the satisfaction of any conditions on which the ruling was based."
A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Sarah Kafka, Chief
Food, Textiles, and Marking Branch
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90 K Street, NE, 10th Floor
Washington, DC 20229-1177