CLA-2 OT:RR:CTF:TCM H121546 CKG
Port Director
U.S. Customs and Border Protection
2nd & Chestnut Streets Room 102 Philadelphia, PA 19106
Attn: Steven Foreman
Re: Protest and Application for Further Review No: 1101-10-100141; Masquelier’s® Original OPCs; Public Version
Dear Port Director:
The following is our decision regarding Protest 1101-10-100141, filed on behalf of the importer, International Bioceuticals (“Protestant”), contesting U.S. Customs and Border Protection’s (CBP) classification of Masquelier’s® Original OPCs grape seed extract in heading 3824 of the Harmonized Tariff Schedule of the United States (HTSUS).
The subject merchandise was entered between April 22, 2009, and March 4, 2010. CBP liquidated the entries on April 16, 2010, in heading 3824, HTSUS. The protest was timely filed on June 11, 2010. Protestant contends that the correct classification of the merchandise is in heading 1302, HTSUS, as a vegetable extract.
In reaching this decision, we have taken into consideration supplemental submissions from the Protestant, dated January 4, 2012, and August 12, 2013.
FACTS:
Masquelier’s® Original OPCs is composed of approximately 60% OPCs (oligomeric proanthocyanidins), 20% other seed polyphenols, 16% other seed material, and 4% water.
The extraction process involves four main steps: extraction with water (separation of the substance/compound from the seed), solid/liquid separation by filtration, purification by (dissolution in) ethyl acetate, and evaporation of the ethyl acetate by vacuum and spray-drying.
ISSUE:
Whether the subject merchandise is a vegetable extract of heading 1302, HTSUS, or an “other” chemical product or preparation of heading 3824, HTSUS.
LAW AND ANALYSIS:
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 for entries made on or after December 18, 2004. (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. 1101-10-100141 was properly accorded to protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed is alleged to be inconsistent with a prior CBP ruling with respect to the same or substantially similar merchandise, specifically HQ W968370, dated July 31, 2008.
Classification of goods under the HTSUS is governed by the General Rules of
Interpretation (GRI). GRI 1 provides that classification 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 HTSUS provisions under consideration are as follows:
1302: Vegetable saps and extracts; pectic substances, pectinates and pectates; agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products:
Vegetable saps and extracts:
1302.19: Other:
Ginseng; substances having anesthetic, prophylactic or therapeutic properties:
1302.19.40: Other . . . .
1302.19.90 Other . . . .
* * * * *
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:
Other:
Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances:
3824.90.28: 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 the headings. It is CBP’s practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
EN 13.02 provides, in pertinent part, as follows:
(A) Vegetable saps and extracts.
The heading covers saps and extracts (vegetable products usually obtained by natural exudation or by incision, or extracted by solvents), provided that they are not specified or included in more specific headings of the Nomenclature (see list of exclusions at the end of Part (A) of this Explanatory Note).
These saps and extracts differ from the essential oils, resinoids and extracted oleoresins of heading 33.01, in that, apart from volatile odoriferous constituents, they contain a far higher proportion of other plant substances (e.g., chlorophyll, tannins, bitter principles, carbohydrates and other extractive matter).
. . . . .
Solid extracts are obtained by evaporating the solvent. Inert substances are sometimes added to certain extracts so that they can be more easily reduced to powder (e.g., belladonna extract, to which powdered gum Arabic is added), or to obtain a standard strength (for instance, certain quantities of starch are added to opium in order to obtain a product containing a known portion of morphine). The addition of such substances does not affect the classification of these solid extracts.
The vegetable saps and extracts of this heading are generally raw materials for various manufactured products. They are excluded from the heading when, because of the addition of other substances, they have the character of food preparations, medicaments, etc.
* * * *
Heading 3824, HTSUS, which provides for “other” chemical products and preparations, can only be used to classify a mixture of natural products as such if the product is not provided for in another heading of the HTSUS (as heading 3824 is a residual heading). Therefore, if it is determined that the merchandise is described by the terms of heading 1302, HTSUS, then heading 3824, HTSUS, cannot be considered for classification of the merchandise.
Heading 1302, HTSUS, describes vegetable extracts. The ENs provide that extracts of heading 1302, HTSUS, are obtained by natural exudation, incision, or extraction by solvents. Other recognized methods of extraction include percolation, maceration, digestion, or infusion. See United States Pharmacopeia (USP), (21st rev., p.1334), and Remington's Pharmaceutical Sciences, (18th ed., p. 1543). The water extraction process described in the instant case is a solvent extraction process mentioned in EN 13.02. The protestant maintains that the method of extraction has not advanced the extract to a level of purity whereby it can no longer be considered an extract and thereby excluded from heading 1302, HTSUS.
The level of purity of the extract is also a determining factor for inclusion in
heading 1302, and not solely the method of extraction. However processed, the extracts described by the ENs and the USP appear to be complex substances containing a large portion of the plant profile such that they are identifiable as an extract of a particular vegetable. Hence, substances obtained from a plant are not considered “vegetable extracts” of heading 1302, if they only contain one ingredient divorced from the composition of the vegetable source.
In HQ W968424, dated December 19, 2006, CBP excluded pine bark extract from heading 1302, HTSUS, due to the level of purification. CBP stated in this case:
Here, with the product Enzogenol®, we have a product that has been highly extracted and standardized so that it contains the desired constituent of the raw pine bark, proanthocyanidin, in concentrations of 76% or greater to the exclusion of other constituents. The extraction procedure involves taking filtered liquor and then further processing it by either ultra-filtration, reverse osmosis, or a combination of both processes... The purpose of these steps is to allow you to create a product that contains a high concentration of the desired components of the starting material to the exclusion of unwanted components. This processing results in an article that does not include all constituents of the starting material in their relative proportions. Thus, the Enzogenol® has been processed to become a dietary supplement, clearly a specialized, not general, purpose. As such, it is not an extract classified in heading 1302, HTSUS.
However, in HQ W968370, dated July 31, 2008, CBP determined that Pycnogenol®, a pine bark extract standardized to contain 60-75% procyanidins, was classified as an extract of heading 1302, HTSUS. The extraction technique at issue in HQ W968370 was also solvent based. A similar solvent extraction process was described in New York Ruling Letter (NY) R03419, dated March 20, 2006, as follows:
The subject product, "JamboLean," consists of a brown powder obtained from the ground-up seeds of the Jambolan tree (Syzygium cumini Skeels) by extraction with an alcohol/water solvent. The liquid extract obtained from solvent extraction is then filtered, distilled, and concentrated, followed by spray-drying, grinding and sieving, to produce the powdered extract (the finished product)… The applicable subheading for the subject product will be 1302.19.9040, Harmonized Tariff Schedule of the United States (HTSUS).”
The Masquelier’s® grape seed extract has a concentration of about 60% OPCs, and 80% total polyphenol content. Although the relatively high concentration of OPCs and overall polyphenols indicates that these compounds are targeted during the extraction process, we find that the level of OPCs is comparable to the procyanidin content of the pine bark extract of HQ W968370. Furthermore, the solvent extraction method used is similar to the process described in HQ W968370 and NY R03419, and less complex than extraction techniques such as reverse osmosis or column chromatography, which CBP has determined target specific compounds to a degree not contemplated by the ENs to heading 1302, HTSUS. See e.g., HQ W968424, dated December 19, 2006; HQ H061203, dated August 12, 2010; HQ 966448, dated July 9, 2004; NY K84522, dated April 9, 2004.
The Masquelier’s® Original OPCs is provided for in heading 1302, HTSUS. Because the merchandise is described by the terms of heading 1302, heading 3824, HTSUS, cannot be applied because the merchandise falling in that heading cannot be included elsewhere. Within heading 1302, HTSUS, protestant claims classification in subheading 1302.19.40, HTSUS, which provides, inter alia, for vegetable saps and extracts having therapeutic properties. Proanthocyanidins and other grape polyphenols have antioxidant properties which are considered to help guard against heart disease, strengthen capillaries, and to limit the progression of diabetic retinopathy. For example, the Merck Index, An Encyclopedia of Chemicals, Drugs, And Biologicals (1996), at page 1266, lists a therapeutic category for Bioflavonoids (the chemical family that includes OPCs and other plant phenolic compounds) as "Capillary protectant”. See also, Lekakis J., et al, (2005). “Polyphenolic compounds from red grapes acutely improve endothelial function in patients with coronary heart disease”. European Journal Cardiovascular Prevention and Rehabilitation,12(6), available at (http://www.ncbi.nlm.nih.gov/pubmed/16319551); Folts J.D., “Potential health benefits from the flavonoids in grape products on vascular disease”. Advances in Experimental Medicine and Biology. 505:95-111 (http://www.ncbi.nlm.nih.gov/pubmed/12083471); Barona J., (2012). “Grape polyphenols reduce blood pressure and increase flow-mediated vasodilation in men with metabolic syndrome”. Journal of Nutrition, 142(9), available at (http://www.ncbi.nlm.nih.gov/pubmed/22810991); Leigh, Mary Jacena. (2003). “Health Benefits of Grape Seed Proanthocyanidin Extract (GSPE)”. Nutrition Noteworthy, 6(1) (http://escholarship.org/uc/item/5fc136ng). The Masquelier’s® and other grape extracts are commonly marketed for these health benefits. See http://www.masquelier.com; http://www.amazon.com/Foods-Grape-Extract-250mg-Vcaps/dp/B000NL8XTQ/ref=sr_1_1?s=hpc&ie=UTF8&qid= 1326225584&sr=1-1; http://www.amazon.com/Olympian-Labs-Extract-capsules-bottle/dp/B000UZUAFA/ref=sr_1_3?s=hpc&ie=UTF8&qid=1326225584&sr=1-3. We therefore agree that there is sufficient technical information stating that the polyphenolic compounds in grape seed extracts have therapeutic properties. See also, HQ 958870, dated August 8, 1996; and HQ H095405, dated June 15, 2010. Masquelier’s® Original OPCs is classified in subheading 1302.19.40, HTSUS.
HOLDING:
By application of GRIs 1 and 6, Masquelier’s® Original OPCs is classified in heading 1302, HTSUS, specifically in subheading 1302.19.40, HTSUS, which provides for: “Vegetable saps and extracts; pectic substances, pectinates and pectates; agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products: Vegetable saps and extracts: Other: Ginseng; substances having anesthetic, prophylactic or therapeutic properties: Other.” The 2010 column one, general rate of duty is 1% ad valorem.
You are instructed to ALLOW the protest in full.
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 International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public online 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