CLA-2 RR:CR:GC 960138 RTR
Port Director of Customs
11099 South La Cienega Blvd.
Los Angeles, California 90045
RE: PRD 2704-96-101948; Starch-based sweet potato vermicelli;
Headings 1901, 1902; Subheadings 1901.90.90, 1902.19.20;
Explanatory Notes to heading 1902.
Dear Port Director:
This is our decision on Protest 2704-96-101948 filed against
your classification of sweet potato vermicelli.
FACTS:
The merchandise consists of a form of pasta known as
vermicelli, and is made from 100% sweet potato starch. On May
19, 1995, an entry was filed for the merchandise under a
provision for pasta in subheading 1902.19.20 of the Harmonized
Tariff Schedule of the United States (HTSUS), which covers pastas
made from unfermented semolinas or flours of wheat, maize, rice,
potatoes, etc.
At that time, the broker certified on the entry documents
that a Food & Drug Administration (FDA) entry had been filed, and
that the cargo would not be released until FDA certification was
received. After examination of a sample taken on May 22, 1995,
by notice of July 19, 1995, the FDA advised the broker that the
FDA refused to allow the entry because the merchandise included a
filthy substance, and ordered that the merchandise be re-exported
or destroyed under Customs supervision within ninety days from
the date of the notice. A notice to redeliver was issued by
Customs to the broker on October 12, 1995, advising that FDA had
refused entry, and ordering the goods to be redelivered into
Customs custody for either re-export or destruction. A deadline
for redelivery of November 16, 1995 was imposed. The protest
claims that the goods were subsequently exported to China in
October, 1995. By notice of December 20, 1995, demand was made
on the importer for $23,547 as liquidated damages for failure to
redeliver the merchandise to Customs as ordered.
To properly classify the goods, on June 9, 1995, Customs
requested further information from the importer regarding the
composition of the vermicelli. In its response of June 13, 1995,
the importer stated that the vermicelli was made not from
semolinas or flours, but from 100% sweet potato starch. Thus,
the entry was liquidated on January 12, 1996 not under subheading
1902.19.20, HTSUS, but under subheading 1901.90.90, HTSUS, as
food preparations with a basis of starch, dutiable at 9.4% ad
valorem.
On April 1, 1996, a Formal Demand on Surety for Payment of
Delinquent Amounts Due was issued by Customs on the surety for
the protested entry. The amount of the demand was the principal
due on the entry ($779.87), plus interest (According to Customs
records, the principal and interest may have been paid.). On May
31, 1996, the surety filed the protest under consideration,
specifically citing the April 1, 1996, Formal Demand on Surety
described above.
The provisions under consideration are as follows:
1901 Malt extract; food preparations of flour,
meal, starch or malt extract, not containing
cocoa or containing 40% or less by weight of
cocoa calculated on a totally defatted basis,
not elsewhere specified or included; food
preparations of foods of headings 0401 to
0404, not containing cocoa or containing less
than 5% by weight of cocoa calculated on a
totally defatted basis, not elsewhere
specified or included:
other:
other:
other:
other:
other:
1901.90.90 other.
* * * *
1902 Pasta, whether or not cooked or stuffed (with
meat or other substances) or otherwise
prepared, such as spaghetti, macaroni,
noodles, lasagna, gnocchi, ravioli,
canneloni, couscous, whether or not prepared:
uncooked pasta, not stuffed or otherwise
prepared:
1902.19 other:
1902.19.20 exclusively pasta
ISSUES:
(1) Whether Customs has the authority to assess duties
against merchandise that has been refused entry by an agency of
the federal government; (2) whether the subject vermicelli, made
from 100% sweet potato starch, is classifiable under subheading
1901.90.90, HTSUS, or under subheading 1902.19.20, HTSUS?
LAW AND ANALYSIS:
Duties on Goods Denied Entry
19 U.S.C. 1558 (a) prohibits remission, abatement, refund,
or drawback of estimated or liquidated duty because of the
exportation or destruction of any merchandise after its release
from the custody of the Government, except in the following
cases: (1) when articles are exported with respect to which a
drawback of duties is expressly provided for by law; (2) when
prohibited articles have been regularly entered in good faith and
are subsequently exported or destroyed pursuant to a law of the
United States and under such regulations as the Secretary of the
Treasury may prescribe; and (3) when articles entered under bond,
under any provision of law, are destroyed within the bonded
period as provided for in 1557 of this title, or are destroyed
within the bonded period by death, accidental fire, or other
casualty, and proof of such destruction is furnished which shall
be satisfactory to the Secretary of the Treasury, in which case
any accrued duties shall be remitted or refunded and any
condition in the bond that the articles shall be exported shall
be deemed to have been satisfied.
19 U.S.C. 1558(b) provides that exportation or destruction
under Customs supervision of articles which have been released
from Customs custody shall not exempt the articles from the
payment of duties, except for marking duties under 19 U.S.C.
1304(c), when articles are exported or destroyed under Customs
supervision after once having been released from Customs custody.
Section 158.41, Customs Regulations (19 CFR 158.41) provides
that merchandise regularly entered or withdrawn from consumption
in good faith and denied admission by any Government agency after
its release from Customs custody... may be destroyed under
Government supervision... In lieu of destruction, the
merchandise may be exported under Customs supervision in
accordance with 158.45(c). Specifically, 158.45 (c) provides
that where merchandise regularly entered and withdrawn from
consumption in good faith is... prohibited entry under any law of
the U.S., it may be exported under Customs supervision..., with
refund of any duties paid... Here, the goods were claimed to
have been exported, but even if they were exported as claimed,
there is no evidence that the merchandise was exported under
Customs supervision. Therefore, under the authority of CFR
158.41, Customs clearly has authority to assess duties on the
subject sweet potato vermicelli.
Classification
Merchandise is classifiable under the HTSUS in accordance
with the General Rules of Interpretation (GRIs). GRI 1 states in
part that for legal purposes, classification shall be determined
according to the terms of the headings and any relative section
or chapter notes, and provided the headings or notes do not
require otherwise, according to GRIs 2 through 6.
The Harmonized Commodity Description And Coding System
Explanatory Notes (ENs) constitute the official interpretation of
the Harmonized System. While not legally binding on the
contracting parties, and therefore not dispositive, the ENs
provide a commentary on the scope of each heading of the
Harmonized System and are thus useful in ascertaining the
classification of merchandise under the System. Customs believes
the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg.
35127, 35128 (Aug. 23, 1989).
The protestant-surety contends that the merchandise is
classifiable in heading 1902, HTSUS, covering exclusively pasta,
specifically in subheading 1902.19.20, HTSUS, providing for
pasta, whether or not cooked or prepared...; uncooked; other.
The claimed classification is erroneous because heading 1902
covers pasta made directly from meal or flour, such as spaghetti,
macaroni, noodles, lasagna, gnocchi, ravioli and canneloni.
While the ENs for heading 19.02 (at page 148) do not exclude
starch-based pasta, they limit pastas includable within chapter
1902 to "unfermented products made from semolinas or flours of
wheat, maize, rice, potatoes, etc. These semolinas or flours...
are first mixed with water and kneaded into a dough which may
also incorporate other ingredients...." The ENs indicate that
heading 1902 pastas may be derived from a variety of vegetable
matter or grains, and may be fashioned into any shape. However,
there is no latitude regarding the intermediary ingredient: the
pasta must be made from a pre-existing semolina or flour.
The merchandise in question was made from 100% sweet potato
starch. Where sweet potatoes are processed into starch and
subsequently pasta is made from the resulting starch, heading
1902 does not apply.
Under the authority of GRI 1, the sweet potato vermicelli is
classifiable in subheading 1901.90.90, HTSUS, as malt extract;
food preparations of flour, meal, starch or malt extract...
other: other: other: other: other: other. The rate of duty is
8.2% ad valorem.
[Although the substance of the protest regarding the
classification of the merchandise and duties on the goods denied
entry is denied and, therefore, the protest is denied, if duties,
fees and interest on the same have been paid to Customs, this
denial is moot. Furthermore, this ruling does not address the
December 20, 1995 Notice of Penalty of Liquidated Damages
Incurred and Demand for Payment for failure to redeliver into
Customs custody the merchandise under consideration.]
HOLDING:
We conclude that under GRI 1 the 100% sweet potato
vermicelli is properly classified in 1901.90.90, HTSUS. This
protest should be DENIED (However, if duties, fees and interest
on the same have been paid to Customs, this denial is moot.). In
accordance with 3A(11)(b) of Customs Directive 099 3550-065,
dated August 4, 1993, Subject: Revised Protest Directive, you
should mail this decision, together with the Customs 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
Regulations and Rulings will take steps to make the decision
available to Customs personnel via the Customs Rulings Module in
ACS and to the public via the Diskette Subscription Service, the
Freedom of Information Act and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division