CLA-2-18:OT:RR:NC:232
Mr. Eric Lorenz
Barry Callebaut Group 600 W. Chicago Avenue
Suite 860
Chicago, Illinois 60604
RE: The tariff classification of Semi-Sweet Chocolate Chips and Dark Chocolate Chips from Canada
Dear Mr. Lorenz:
In your letter dated January 20, 2021, you requested a tariff classification ruling.
The subject merchandise is described as two chocolate products: Semi-Sweet Chocolate Chips and Dark Chocolate Chips.
Semi-Sweet Chocolate Chips are said to contain 56.1 percent Sugar, 32.2 percent Cocoa Liquor, 7.5 percent Cocoa Butter, 2 percent Anhydrous Milk-Fat, 2 percent Cocoa Powder, and trace amounts of Vanilla and Lecithin. Both the milk fat and milk solids content are said to be 2 percent. The product will be imported in three forms of packaging: super sacks (900 kilograms), bulk cases (20-50 pounds), and retail bags (300 grams). Semi-Sweet Chocolate Chips will be used for further processing into final products or repacked for retail sale.
Dark Chocolate Chips are said to contain 56.1 percent Sugar, 34.2 percent Cocoa Liquor, 7.5 percent Cocoa Butter, 2 percent Anhydrous Milk-Fat, and trace amounts of Vanilla and Lecithin. Both the milk fat and milk solids content are said to be 2 percent. The product will be imported in three varying packs, super sacks (900 kilograms), bulk cases (20-50 pounds), and retail bags (300 grams). Dark Chocolate Chips will be used for further processing into final products or repacked for retail sale.
In your letter, you suggested classification under 1806.20.5000, HTSUS. Chocolate preparations under subheading 1806.20.5000, HTSUS, must consist wholly of ground cocoa beans. The Semi-Sweet Chocolate Chips contain 2 percent Cocoa Powder. The presence of cocoa powder precludes the classification of the Semi-Sweet Chocolate Chips under subheading 1806.20.5000, HTSUS.
The Dark Chocolate Chips meet the ingredient requirements (wholly of ground cocoa beans) of 1806.20.5000, HTSUS. However, they may be classified elsewhere in the subheading due to the fact that they contain 2 percent Anhydrous Milk Fat (Milk Solids) but not over 5.5 percent of butterfat.
HQ H009857, dated September 24, 2008, discussed the classification of chocolate chips imported in bulk packaging and retail bags. Headquarters stated that chocolate chips are considered a bulk form similar to the exemplars listed therein and fall under the provisions of 1806.20, HTSUS, as long as they meet the minimum weight requirements of a content exceeding 2 kg.
Headquarters went on to further state that “chocolate chips shipped in 300-gram retail bags are classifiable as “other” food preparations containing cocoa under subheading 1806.90, HTSUS inasmuch as they do not meet the minimum quantitative weight limit set forth in subheading 1806.20, HTSUS,” and as long as the chocolate chips contains over 5.5 percent by weight of butterfat.
We note that both the Semi-Sweet Chocolate Chips and the Dark Chocolate Chips contain less than 5.5 percent of butterfat and less than 21 percent by weight of milk solids. Therefore, both products are precluded from classification under subheading 1806.20.5000, HTSUS.
The applicable subheading for the Dark Chocolate Chips shipped in super sacks (900 kilograms) and bulk cases (20-50 pounds) will be 1806.20.3400, Harmonized Tariff Schedule of the United States (HTSUS), which provides for chocolate and other food preparations containing cocoa: Other preparations in blocks, slabs or bars, weighing more than 2 kg or in liquid, paste, powder granular or other bulk form in containers or immediate packings, of a content exceeding 2 kg: Preparations consisting wholly of ground cocoa beans, with or without added cocoa fat, flavoring or emulsifying agents, and containing not more than 32 percent by weight of butterfat or other milk solids and not more than 60 percent by weight of sugar: Other: Containing butterfat or other milk solids (excluding articles for consumption at retail as candy or confection): Other: Described in additional U.S. note 3 to this chapter and entered pursuant to its provisions. The rate of duty will be 5 percent ad valorem.
If the quantitative limits of additional U.S. note 3 to chapter 18 have been reached, and the product contains less than 21 percent by weight of milk solids, classification is under 1806.20.3600, HTSUS, and dutiable at the rate of 37.2 cents per kilogram plus 4.3 percent ad valorem. In addition, products classified in subheading 1806.20.3600, HTSUS, will be subject to additional duties based on their value as described in subheadings 9904.18.19 to 9904.18.30, HTSUS.
The applicable subheading for the Semi-Sweet Chocolate Chips shipped in super packs (900 kilograms) and bulk cases (20-50 pounds) will be 1806.20.9900, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Chocolate and other food preparations containing cocoa: Other preparations in blocks, slabs or bars, weighing more than 2 kg or in liquid, paste, powder, granular or other bulk form in containers or immediate packings, of a content exceeding 2 kg: Other: Other: Other: Other: Other. The general rate of duty will be 8.5 percent ad valorem.
The applicable subheading for the Semi-Sweet Chocolate Chips and Dark Chocolate Chips shipped in retail bags (300 grams) will be 1806.90.2500, Harmonized Tariff Schedule of the United States (HTSUS), which provides for Chocolate and other food preparations containing cocoa: Other: Other: Containing butterfat or other milk solids (excluding articles for consumption at retail as candy or confection): Other: Described in additional U.S. note 3 to chapter 18 and entered pursuant to its provisions. The rate of duty will be 3.5 percent ad valorem.
If the quantitative limits of additional U.S. note 3 to chapter 18 have been reached, and the product contains less than 21 percent by weight of milk solids, classification is under 1808.90.2800, HTSUS, and dutiable at the rate of 37.2 cents per kilogram plus 6 percent ad valorem. In addition, products classified in subheading 1806.90.2800, HTSUS, will be subject to additional duties based on their value as described in subheadings 9904.18.19 to 9904.18.30, HTSUS.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 on the World Wide Web at https://hts.usitc.gov/current.
This merchandise is subject to The Public Health Security and Bioterrorism Preparedness and Response Act of 2002 (The Bioterrorism Act), which is regulated by the Food and Drug Administration (FDA). Information on the Bioterrorism Act can be obtained by calling the FDA at 301-575-0156, or at the Web site www.fda.gov/oc/bioterrorism/bioact.html.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Frank Troise at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division