OT:RR:CTF:FTM H311412 JER
Center Director
Pharmaceuticals, Health and Chemicals
Center for Excellence and Expertise 1100 Raymond Boulevard Newark, NJ 07730
ATTN: Tracy L. Coffield, Import Specialist
RE: Application for Further Review of Protest No. 3901-20-112902; Tariff Classification of mixed feeds and mixed-feed ingredients
Dear Center Director:
This is our decision regarding the Application for Further Review (“AFR”) of Protest No. 3901-20-112902, timely filed on or about May 29, 2020, by the law firm of Faegre Drinker Biddle & Reath LLP, on behalf of their client, Lonza, Ltd. (“Protestant”), concerning the tariff classification of a certain animal feed formulation under the Harmonized Tariff Schedule of the United States (“HTSUS”). Protest No. 3901-20-112902 is the lead protest for all other protests filed concerning the subject imported goods.
Protestant has asked that certain information submitted in connection with this AFR 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 will not be released to the public and will be withheld from published versions of this decision.
FACTS:
This AFR concerns entries made on or about July 1, 2019, wherein CBP liquidated the imported Carniking™ 10 under subheading 2309.90.95, HTSUS, which provides for: “Preparations of a kind used in animal feeding: Other: Other: Other: Other: Other.”
According to Protestant, the subject “Carniking™ 10 is formulated under a confidential formula that includes: [XXXXXX, XXXXXX, and [XXXXXX], [XXXXXX] and XXXXXX water]. The [XXXXXX] is dissolved in [XXXXXX]. A mixture of dry [XXXXXX] are mixed together. [XXXXXX and XXXXXX] are added. Next, the dry mixture of [XXXXXX, XXXXXX, XXXXXX, XXXXXX] and other ingredients are injected with liquid XXXXXX]. Once the dry formula is created, it is sieved and then filled into bags for transport.
Protestant describes the subject Carniking™ 10 as an animal feed preparation, utilized in dry feed formulations. According to Protestant, Carniking™ 10 is a source of L-carnitine. Carnitine is an amino acid derivative that occurs naturally in the body. It is essential for energy metabolism - in particular, the metabolism of fatty acids. L-carnitine aids in fat digestion and impacts other cellular biochemical processes in the body, both directly and indirectly. Carniking™ 10 is produced by applying L-carnitine to an inert carrier. It is said to be free flowing, non-hygroscopic, and readily miscible. Carniking™ 10 is used in the manufacturing of dry animal feed formulations, premixes, and other base mixes.
ISSUE:
Whether the subject animal feed formulation is “mix feeds or mixed-feed ingredient” for purposes of Additional U.S. Note 1 to Chapter 23, HTSUS, and, therefore, classifiable under subheading 2309.90.10, HTSUS, or whether the animal feed formulation is properly classified under subheading 2309.90.95, HTSUS.
LAW AND ANALYSIS:
Initially, we note that the matter is protestable under 19 U.S.C. § 1514(a)(2) as a decision on classification. The protest was timely filed on or about May 29, 2020, within 180 days of liquidation. 19 U.S.C. § 1514(c)(3). Further Review of Protest No. 3901-20-112902 was properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(c) because the decision against which the protest was filed is alleged to be inconsistent with matters previously ruled upon by the Commissioner of Customs or his designee or by the Customs courts.
Classification of goods under the HTSUS is made in accordance with the General Rules of Interpretation (“GRI”). 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 GRI may then be applied in order.
Because the instant classification question occurs beyond the four-digit heading level, GRI 6 is implicated. Pursuant to GRI 6, classification at the subheading level uses the same rules, mutatis mutandis, as classification at the heading level. GRI 6 further provides that, for legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
The HTSUSA subheadings under consideration are the following:
2309 Preparations of a kind used in animal feed:
2309.90 Other:
2309.90.10 Mix feeds or mixed-feed ingredients…
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2309.90.1050 Other…
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Other:
Other:
2309.90.9500 Other…
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The relevant Legal Notes to Chapter 23, HTSUS, are the following:
Note
1. Heading 2309 includes products of a kind used in animal feeding, not elsewhere specified or included, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material, other than vegetable waste, vegetable residues and byproducts of such processing.
Additional U.S. Note
1. The term “mixed feeds and mixed-feed ingredients” in subheading 2309.90.10 embraces products of heading 2309 which are admixtures of grains (or products, including byproducts, obtained in milling grains) with molasses, oilcake, oil-cake meal or feedstuffs, and which consist of not less than 6 percent by weight of grain or grain products.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) 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 (August 23, 1989).
The ENs to heading 2309, HTSUS, provide, in relevant part, as follows:
This heading covers sweetened forage and prepared animal feeding stuffs consisting of a mixture of several nutrients designed:
(1) to provide the animal with a rational and balanced daily diet (complete feed);
(2) to achieve a suitable daily diet by supplementing the basic farm produced feed with organic or inorganic substances (supplementary feed); or
(3) for use in making complete or supplementary feeds.
The heading includes products of a kind used in animal feeding, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material, for example, in the case of products obtained from vegetable materials, those which have been treated to such an extent that the characteristic cellular structure of the original vegetable material is no longer recognisable under a microscope.
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(C) PREPARATIONS FOR USE IN MAKING THE COMPLETE FEEDS OR SUPPLEMENTARY FEEDS DESCRIBED IN (A) AND (B) ABOVE
These preparations, known in trade as “premixes”, are, generally speaking, compound compositions consisting of a number of substances (sometimes called additives) the nature and proportions of which vary according to the animal production required. These substances are of three types :
(1) Those which improve digestion and, more generally, ensure that the animal makes good use of the feeds and safeguard its health : vitamins or provitamins, amino acids, antibiotics, coccidiostats, trace elements, emulsifiers, flavourings and appetisers, etc.
(2) Those designed to preserve the feeding stuffs (particularly the fatty components) until consumption by the animal : stabilisers, anti oxidants, etc.
(3) Those which serve as carriers and which may consist either of one or more organic nutritive substances (manioc or soya flour or meal, middlings, yeast, various residues of the food industries, etc.) or of inorganic substances (e.g., magnesite, chalk, kaolin, salt, phosphates).
The concentration of the substances described in (1) above and the nature of the carrier are determined so as to ensure, in particular, homogeneous dispersion and mixing of these substances in the compound feeds to which the preparations are added.
Provided they are of a kind used in animal feeding, this group also includes:
(a) Preparations consisting of several mineral substances.
(b) Preparations consisting of an active substance of the type described in (1) above with a carrier, for example products of the antibiotics manufacturing process obtained by simply drying the mass, i.e. the entire contents of the fermentation vessel (essentially mycelium, the culture medium and the antibiotic). The resulting dry substance, whether or not standardised by adding organic or inorganic substances, has an antibiotic content ranging generally between 8% and 16% and is used as basic material in preparing, in particular, “premixes”.
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Protestant asserts that the imported product is properly classified under subheading 2309.90.10, HTSUS. Protestant argues that despite being composed of only one singular grain, the subject Carniking™ 10 meets the definition of “mix feeds or mixed-feed ingredients” for purposes of Additional U.S. Note 1 to Chapter 23, HTSUS. Protestant further contends that the term “mix feeds or mixed-feed ingredients” does not require multiple different types of grains and that the subject Carniking™ 10 includes the requisite amount of grain as well as a component ingredient which falls under the category of “feedstuffs” as set forth in Additional U.S. Note 1 to Chapter 23, HTSUS. Lastly, Protestant explains that the subject Carniking™ 10 is used in the manufacture of dry feed formulations, including dry dog and cat foods and as such is provided for more specifically under subheading 2309.90.10, HTSUS.
It is not disputed that the subject animal feed ingredient is prima facie classified under heading 2309, HTSUS. At the four-digit level, heading 2309, HTSUS, provides for: “Preparations of a kind used in animal feeding.” Moreover, Note 1 to Chapter 23, HTSUS, provides, in relevant part, that: “Heading 2309 includes products of a kind used in animal feeding, not elsewhere specified or included, obtained by processing vegetable or animal materials to such an extent that they have lost the essential characteristics of the original material…” Similarly, the ENs to heading 2309, HTSUS, explain that the heading includes preparations for use in making complete animal feeds and that such preparations are made up of “compound compositions consisting of a number of substances (sometimes called additives) the nature and proportions of which vary according to the animal production required.” The subject Carniking™ 10 consists of various ingredients, which are combined to be used in animal feed. The combining of the wheat bran, L-carnitine and other minerals in a such a manner to be used as an animal feed qualifies the product as a preparation of heading 2309, HTSUS.
At issue is whether the subject Carniking™ 10 is properly classified under subheading 2309.90.95, HTSUS, as a preparation of a kind used in animal feed not elsewhere specified or provided for, or whether the subject Carniking™ 10 is classified as “mixed feeds or mixed-feed ingredients” under subheading 2309.90.10, HTSUS. Inasmuch as classification of the subject product requires examination of two subheadings at the eight-digit level, classification cannot be determined in accordance with GRI 1, but instead must be determined in accordance with GRI 6. Under the HTSUS, classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. Moreover, in accordance with GRI 6, the subheading which provides the most specific description shall be preferred to subheadings providing a more general description.
In order for an animal feed preparation to be classified as a mixed feed or mixed-feed ingredient under subheading 2309.90.10, HTSUS, it must conform to the requirements set forth in Additional U.S. Note 1 to Chapter 23, HTSUS. Additional U.S. Note 1 to Chapter 23, HTSUS, provides, in pertinent part, that the term “mixed feeds and mixed-feed ingredients in subheading 2309.90.10, HTSUS” means: admixtures of grains with molasses, oilcake, oil-cake meal or feedstuffs, and which consist of not less than 6 percent by weight of grain or grain products. The plain language in Additional U.S. Note 1 to Chapter 23, HTSUS, directs that “admixtures of grains” with either molasses, oil-cake or feedstuff which consist of not less than 6 percent by weight of grain or grain products are prima facie classifiable under subheading 2309.90.10, HTSUS.
In Headquarters Ruling Letter (“HQ”) 954921, dated November 22, 1993, CBP has considered whether Additional U.S. Note 1 to Chapter 23, HTSUS, required a mixture of two or more grains or grain products. In HQ 954921, three animal feed products were at issue: the Calpan 80 Premix, the Calpan 160 Premix and the Riboflavin 60 Premix (hereinafter collectively referred to as the “premix” or “premixes”). While each of the premixes contained over 6 percent by weight of grain or grain products, each premix only had one singular grain product. In HQ 954921, CBP determined that “term ‘mixed feeds and mixed feed ingredients,’ as defined in Additional U.S. Note 1, Chapter 23, HTSUS, does not require that the admixture must contain two or more types of grains or grain products.” The use of the singular form of “grain” in Additional U.S. Note 1, Chapter 23, HTSUS, indicates that the statutory language contemplates an admixture of grain and other products but does not mandate multiple different types of grain for a product to be classified within subheading 2309.90.10, HTSUS. In making its determination, CBP relied on a decision by the Court of International Trade (“CIT”) where the CIT defined the term “feedstuff” with respect to Additional U.S. Note 1, Chapter 23, HTSUS.
In Vitek Supply Co. v. United States, 17 C.I.T. 111, 111 (1993), the court considered the classification of an animal food product described as Veal Premix, that consisted of six percent by weight of grain mixed with vitamins and minerals. At issue was whether the vitamins and minerals could be considered “feedstuff” for purposes of Additional U.S. Note 1, Chapter 23, HTSUS, given that the vitamins and minerals could also be sold for human consumption (and therefore not used for animal feed). The Veal Premix only consisted of one singular grain product. The court instituted a two-part test to determine whether an ingredient could be considered “feedstuff:” 1) whether the mixture, as a whole, was animal feed; and 2) whether the feedstuff portion of the mixture provided a nutritional source that could be sold for human consumption. The court noted that once the vitamins and minerals were incorporated into the Veal Premix, they were no longer fit for human consumption. As such, the court held that the Veal Premix, which contained a single grain product combined with vitamins and minerals was properly classified as “mixed feeds or mixed-feed ingredient” under subheading 2309.90.10, HTSUS.
Like the premixes in HQ 954921, the subject Carniking™ 10 mix only contains one singular grain ingredient (wheat bran) which, in this case, is combined with minerals and the L-carinitine. The fact that it only contains one singular grain does not preclude the subject Carniking™ 10 from classification under subheading 2309.90.10, HTSUS. As previously stated, the use of the singular form of the word “grain” in Additional U.S. Note 1, Chapter 23, HTSUS, indicates that the statutory language contemplates an admixture of at least one grain but does not mandate that the admixture contain multiple types of grains to be classified under subheading 2309.90.10, HTSUS. Having established that one singular grain is sufficient to satisfy the terms of Additional U.S. Note 1, Chapter 23, HTSUS, the only remaining question is whether the subject product can be considered an admixture and whether it contains molasses, oilcake, oil-cake meal or in this case, feedstuffs.
In the instant case, the subject Carniking™ 10 can be defined as an admixture in that it is a product that consists of various ingredients that have been mixed together. In particular, the subject Carniking™ 10 is produced by mixing together various ingredients such as: wheat bran, and L-carintine, which are blended together, mixed and sieved to create a formulation to be used in dry dog food or cat food. Such a formulation is an admixture for purposes subheading 2309.90.10, HTSUS. Likewise, the component L-carintine ingredient satisfies the definition of a “feedstuff” portion of the admixture as defined by in Vitek Supply.
The court in Vitek Supply stated that to qualify as feedstuff, that either the mixture as a whole was an animal feed or the feedstuff portion must constitute a nutrition source. The L-carintine is a “feedstuff” because it is the portion of the Carniking™ 10 mixture that constitutes the nutritional source. According to Protestant’s website, “The primary function of L-carnitine is to aid in the transport of fatty acids into the mitochondria. The mitochondrion is often referred to as the “engine” of the cell and one of its primary functions is to convert fat into energy[.]” Caniking Health Benefits, Lonza.com, available at, https://www7.lonza.com/products-services/consumer-health/nutrition/animal-nutrition/carniking-for-companion-animals.aspx.html (last visited April 27, 2021). Improving an animal’s metabolism and converting fat into energy is a nutritional value which is contemplated by the ENs to heading 2309, HTSUS. In particular, EN to heading 2309 explains that the heading includes products that “improve digestion and, more generally, ensure that the animal makes good use of the feeds and safeguard its health: vitamins or pro vitamins, amino-acids, antibiotics, coccidiostats, trace elements, emulsifiers, flavorings and appetizers, etc.” Protestant’s website explains the impact of the L-carintine on digestion and metabolism as follows:
Fat Metabolism The body derives its energy from the metabolism of carbohydrates, proteins and fats. In order for the body to utilize these nutrients for energy, they must first be broken down into smaller building blocks. In the case of fats, the digestion starts with the release of smaller fatty acid units from the longer fatty acid chains. These small fatty acids are then transported to the mitochondria, the site where they are converted into energy.
Caniking Health Benefits, Lonza.com, available at, https://www7.lonza.com/products-services/consumer-health/nutrition/animal-nutrition/carniking-for-companion-animals.aspx.html (last visited April 27, 2021). It follows that the L-carintine portion of the subject Carniking™ 10 mixture constitutes a source of nutrition within the meaning of Vitek Supply.
Based on all the aforementioned, we find that the subject Carniking™ 10 is a mix feed or mixed-feed ingredient within the meaning of subheading 2309.90.10, HTSUS. It is therefore classified under subheading 2309.90.10, HTSUS. In particular, the subject Carniking™ 10 is an admixture of grain and feedstuff (L-carnitine) which consists of more than 6 percent of at least one grain type (wheat bran) it meets the definition of a mix feed or mixed feed ingredient for purposes of subheading 2309.90.10, HTSUS. This decision follows the rationale set forth in both Vitek Supply and HQ 954921. Furthermore, this decision is consistent with previous CBP rulings involving similar mixed-feed products. For example, in New York Ruling Letter (“NY”) N279058, dated September 23, 2016, CBP classified a Tuna Feed mix under subheading 2309.90.1050, HTSUSA, which consisted of fish meal, fish oil, whole wheat, raw starch, gelatin, rovimix (vitamin), stay c (vitamin), taurine, sodium benzoate, and butylated hydroxytoluene (antioxidant). The Tuna Feed in NY N279058 contained a single grain (whole wheat) combined with vitamins and minerals which were considered to be feedstuff for purposes of Additional U.S. Note 1, Chapter 23, HTSUS. Likewise, in NY N268847, dated October 5, 2015, CBP considered the classification of a product that contained of one singular grain type (flour) and other mineral and vitamins such as calcium carbonate, vegetable oil, monopotassium phosphate, and magnesium oxide. CBP classified the product, known as Denkaveal Nucleostart 200 under subheading 2309.90.1050, HTSUSA as a “mixed feed” or “mixed-feed ingredient.”
HOLDING:
By application of GRI 6, HTSUS, the animal fed formulation is classified in subheading 2309.90.10, HTSUS. In particular, it is classified under subheading 2309.90.1050, HTSUSA, which provides for, “Preparations of a kind used in animal feed: Other: Mix feeds or mixed-feed ingredients, Other.” The column one, general rate of duty is free.
You are instructed to GRANT the Protest in Full.
In accordance with the Protest/Petition Processing Handbook (CIS 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 in accordance with this decision must be accomplished prior to mailing of 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 Customs Rulings Online Search System (“CROSS”) at https://rulings.cbp.gov/ which can be found on the U.S. Customs and Border Protection website at http://www.cbp.gov and other methods of public distribution.
Sincerely,
For Craig T. Clark, Director
Commercial and Trade Facilitation Division