CLA-2-17:OT:RR:NC:N2:232
Mr. Louis Shoichet Sandler, Travis & Rosenberg, P.A. 675 Third Avenue, Suite 1805-06 New York, NY 10017
RE: The Classification and Country of Origin for “Juicy Drop Gummies” Candy
Dear Mr. Shoichet,
This is in response to your letter dated March 31, 2022, on behalf of The Bazooka Companies, Inc., requesting a ruling on the classification and country of origin of “Juicy Drop Gummies” candy.
Classification:
The subject merchandise is described as a gummy sugar candy imported and sold as a retail packaged unit with a plastic dispenser of sour gel sugar candy. The retail package will weigh approximately 57 grams and consist of approximately twelve gummy candies and an accompanying sour gel candy. The gummy candy is said to contain sugar, glucose syrup, gelatin, sorbitol as well as natural and artificial flavors. The sour gel candy is said to contain sugar, dextrin, glucose syrup as well as natural and artificial flavors. The gummy candy will be fully manufactured in Indonesia and exported in bulk to China. In China the gummy candy will be packaged with the sour gel candy (Product of China) in sealed polybags.
The applicable subheading for the “Juicy Drop Gummies” will be 1704.90.3550, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Sugar confectionary (including white chocolate), not containing cocoa: Other: Confections or sweetmeats ready for consumption: Other: Other: Put up for retail sale: Other.” The rate of duty will be 5.6 percent ad valorem.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 1704.90.3550, HTSUS, unless specifically excluded, are subject to an additional 25 percent ad valorem rate of duty. At the time of importation, you must report the Chapter 99 subheading, i.e., 9903.88.03, in addition to subheading 1704.90.3550, HTSUS, listed above.
The HTSUS is subject to periodic amendment so you should exercise reasonable care in monitoring the status of goods covered by the Note cited above and the applicable Chapter 99 subheading. For background information regarding the trade remedy initiated pursuant to Section 301 of the Trade Act of 1974, you may refer to the relevant parts of the USTR and CBP websites, which are available at https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions and https://www.cbp.gov/trade/remedies/301-certain-products-china, respectively.
Country of Origin:
The marking statute, section 304, Tariff Act of 1930, as amended (19 USC 1304), provides that, unless excepted, every article of foreign origin (or its container) imported into the U.S. 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 U.S. the English name of the country of origin of the article. As provided in 19 CFR 134.41(b), the country of origin marking is considered conspicuous if the ultimate purchaser in the U.S. is able to find the marking easily and read it without strain. With regard to the permanency of a marking, 19 CFR 134.41(a), provides that as a general rule marking requirements are best met by marking worked into the article at the time of manufacture. For example, it is suggested that the country of origin on metal articles be die sunk, molded in, or etched. However, 19 CFR 134.44, generally provides that any marking that is sufficiently permanent so that it will remain on the article until it reaches the ultimate purchaser unless deliberately removed is acceptable.
The "country of origin" is defined in 19 CFR 134.1(b) as "the 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 this part."
The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character or use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff'd, 989 F.2d 1201 (Fed. Cir. 1993).
You provide documentation indicating the gummy candy will be exported from Indonesia to China, whereupon it will be packaged with Chinese origin sour gel candy for export to the United States. It is the opinion of this office that packaging the gummy candy, which is wholly produced in Indonesia, with Chinese origin sour gel candy would not constitute a substantial transformation because the resulting product would not emerge with a new name, character, and use that is different from what it possessed prior to processing. Thus, the gummy candy and the sour gel candy remain goods of their respective countries. The country of origin for the gummy candy is Indonesia and the country of origin of the sour gel candy is China.
The countries of origin of the “Juice Drop Gummy” for the purposes of the application of subheading 9903.88.03, HTSUS, are Indonesia (the country of origin of the gummy candy), and China (the country of origin of the sour gel candy). As the “Juicy Drop Gummy Candy” contains a product of China, Section 301 measures will apply. To the extent that the sour gel candy is a product of China, the value of it may be apportioned from the total of the “Juicy Drop Gummies” for purposes of the duty assessment.
Additionally, we find that marking this product using the suggested phrase, "Gummy Candy Made in Indonesia, Sour Gel Candy Made in China, Packaged in China" as permissible if it meets the other requirements discussed above.
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 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 confectionery, contact National Import Specialist Frank Troise at frank.l.troise.cbp.dhs.gov.
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division