CLA-2-18:OT:RR:NC:N5:231
Jeremy Page, Esq.
Page Fura, P.C.
939 W. North Avenue
Suite 750
Chicago, IL 60642
RE: The tariff classification and eligibility under the United States-Mexico-Canada Agreement (USMCA)
for a Chocolate Preparation
Dear Mr. Page:
In your letter dated July 6, 2025, you requested a ruling on the tariff classification and eligibility under the
USMCA of a Chocolate Preparation on behalf of your client, Clasen Quality Chocolate, Inc. (Madison, WI).
An ingredients breakdown, production description, product specifications, and representative images of the
product container accompanied your inquiry.
The subject merchandise is described as a Chocolate Preparation. The ingredients are said to be 99 percent
chocolate liquor and 1 percent sugar. The chocolate liquor is stated to be manufactured in Ivory Coast,
Ghana, Nigeria, Cameroon, Ecuador, Peru, and/or Brazil. The origin of the sugar is not stated. Once
produced, the liquor will be exported to Canada for granulated sugar to be added and establish the required
99 to 1 percent ratio. After mixing occurs in Canada, the finished preparation will be shipped to the United
States in a melted state of approximately 40,000 lbs. as stored in liquid tanker trucks, or in a solid state as 10
lb. blocks packaged in 2,000 lb. totes or larger one metric ton blocks.
Classification:
The applicable subheading for the Chocolate Preparation will be 1806.20.5000, 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: Other.” The general rate of duty will be 4.3 percent ad valorem.
Products of Canada as provided by heading 9903.01.10 in Section XXII, Chapter 99, Subchapter III, U.S.
Note 2(j), HTSUS, other than products classifiable under headings 9903.01.11, 9903.01.12, 9903.01.13,
9903.01.14, and 9903.01.15, HTSUS, will be subject to an additional 25 percent ad valorem rate of duty. At
the time of entry, you must report the applicable Chapter 99 heading, i.e. 9903.01.10, in addition to
subheading 1806.20.5000, HTSUS, listed above. Articles that are entered free of duty under the terms of
general note 11 to the HTSUS (U.S.-Mexico-Canada Agreement (USMCA)), including any treatment set
forth in subchapter XXIII of Chapter 98 and subchapter XXII of chapter 99 of the HTSUS, will not be
subject to the additional ad valorem duties provided for in heading 9903.01.10. If your product is entered
duty free as originating under the USMCA, you must report heading 9903.01.14, HTSUS, in addition to
subheading 1806.20.5000, HTSUS.
Effective April 5, 2025, Executive Orders implemented “Reciprocal Tariffs.” All imported merchandise
must be reported with either the Chapter 99 provision under which the reciprocal tariff applies or one of the
Chapter 99 provisions covering exceptions to the reciprocal tariffs. At this time products from all countries
will be subject to an additional 10 percent ad valorem rate of duty. Your product falls within an excepted
subheading. At the time of entry, you must report the Chapter 99 heading applicable to your product
classification, i.e. the 9903.01.26 exclusion subheading, in addition to subheading 1806.20.5000, HTSUS,
listed above.
The tariffs and additional duties cited herein are current as of this ruling’s issuance. 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 at https://hts.usitc.gov/.
USMCA:
The USMCA was signed by the Governments of the United States, Mexico, and Canada on November 30,
2018. The USMCA was approved by the U.S. Congress with the enactment on January 29, 2020 of the
USMCA Implementation Act, Pub. L. 116-113, 134 Stat. 11, 14 (19 U.S.C. § 4511(a)). General Note (“GN”)
11 of the HTSUS implements the USMCA. GN 11(b) sets forth the criteria for determining whether a good
is an originating good for purposes of the USMCA. GN 11(b) states the following:
For the purposes of this note, a good imported into the customs territory of the United States from the
territory of a USMCA country, as defined in subdivision (l) of this note, is eligible for the preferential
tariff treatment provided for in the applicable subheading and quantitative limitations set forth in the
tariff schedule as a “good originating in the territory of a USMCA country” only if –
(i) the good is a good wholly obtained or produced entirely in the territory of one or more USMCA
countries;
(ii) the good is a good produced entirely in the territory of one or more USMCA countries,
exclusively from originating materials;
(iii) the good is a good produced entirely in the territory of one or more USMCA countries using
non-originating materials, if the good satisfies all applicable requirements set forth in this note
(including the provisions of subdivision (o));
Production of the Chocolate Preparation in Canada results in an originating good from a USMCA Rules of
Origin perspective. For goods classified under subheading 1806.20.5000, HTSUS, the applicable Rule of
Origin requires the following: “A change to subheading 1806.20 from any other heading.” In the case of the
instant product, this requirement is met.
The granulated sugar in the finished product has been produced from cane or beet sugar that is classified in
heading 1701, HTSUS, a classification in a heading other than Heading 1806.
The chocolate liquor in question is said to be pure, comprised exclusively of the cocoa beans from which it
has been ground. In this case, the liquor is similarly said to be cocoa liquor or cocoa paste, the latter of
which is classified in subheading 1803.10.0000, HTSUS if not defatted, or in subheading 1803.20.0000,
HTSUS if wholly or partly defatted. In either case, the classification of the chocolate liquor under in heading
1803 puts it in a heading other than 1806. As such, and coupling this with classification of the granulated
sugar in Heading 1701, the requisite change in classification occurs consistent with USMCA’s Rules of
Origin and results in a USMCA originating good.
Based on the facts provided, the chocolate preparation qualifies for USMCA preferential treatment because it
meets the requirements of HTSUS General Note 11(b)(iii). The merchandise will therefore be entitled to a
free rate of duty under the USMCA upon compliance with all applicable laws, regulations, and agreements.
The holding set forth above applies only to the specific factual situation and merchandise description as
identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations
(CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the
information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and
complete in every material respect. In the event that the facts are modified in any way, or if the goods do not
conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and
Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2.
Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic
verification by CBP.
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 and Border Protection
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, please contact
National Import Specialist Frank Troise at [email protected].
Sincerely,
(for)
James Forkan
Acting Director
National Commodity Specialist Division