CLA-2 RR:CTF:TCM 967972 BtB
Brian S. Goldstein, Esq.
Tompkins & Davidson
One Astor Plaza
1515 Broadway, 43rd Fl.
New York, NY 10036-8901
RE: Modification of NY 814027; the tariff classification of Silymarin (milk thistle) and Leucoanthocyanin
Dear Mr. Goldstein:
This is in regard to New York Ruling Letter (NY) 814027, dated February 2, 1996, issued to you on behalf of your client, Indena USA Inc. (Indena), regarding the classification of silymarin (identified as “Milk thistle (Silybum Marianum)”) and leucoanthocyanin (identified as “Leucoanthocyanins [(grape seed) Vitis Vinifera]”) under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). That ruling held that four products, including silymarin and leucoanthocyanin, were classified in subheading 1302.19.4040, HTSUS, the provision for "Vegetable saps and extracts; pectic substances, pectinates and pectates; agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products: Vegetable saps and extracts: Other: Ginseng; substances having anesthetic, prophylactic or therapeutic properties: Other, Other."
We have reviewed NY 814027 and, with respect to two of the four products classified, have found it to be in error. Therefore, this ruling modifies NY 814027.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by Title VI, a notice was published in the June 22, 2005, CUSTOMS BULLETIN, Volume 39, Number 26, proposing to modify NY 814027, and to revoke any treatment accorded to substantially identical transactions. We received one comment, from you, opposing modification of NY 814027. Your comment is addressed below.
FACTS:
The silymarin here in issue is a yellow powder that contains 80% mixture of isomers of silymarin (silybin, silicristin and silidianin). Silymarin 80% is produced from milk thistle seeds. The seeds are milled into a cake, subjected to percolation in a solvent, filtered, and concentrated by distillation under vacuum to remove as much solvent as possible. This concentrate is then washed, defatted, and dried.
The leucoanthocyanin here in issue is a brownish powder consisting of 90-95% oligomeric proanthocyanidin (OPC). OPC is a mixture of proanthocyanidin compounds in different degrees of polymerization. Some of the OPCs are catechins with a chemical formula of C15H14O6 (The Merck Index, 11th ed.), dimers (two degrees), trimers (three degrees), etc. Due to these varying states of polymerization, the OPCs are not comprised of a single chemical compound, although the main chemical structures are identical. Leucoanthocyanin can be produced from either pine bark or grape seed.
According to flow charts submitted by Indena, all of the products are obtained through extraction and refining processes that target a particular family of chemicals in the plant such as isomers of silymarin or OPCs.
In the comment that you submitted opposing modification of NY 814027, you stated that “while Indena maintains that the current classification of the two extracts under subheading 1302.19.40.40, HTSUS, is correct, the company also maintains that if Heading 1302, HTS does not apply, that the instant products qualify as “medicaments” under subheading 3003.90.00.00, HTSUS.”
ISSUE:
What is the proper classification of the silymarin and leucoanthocyanin extracts under the HTSUS?
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context that requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any related section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and mutatis mutandis, to the GRIs. In interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
Furthermore, "it is a well-established principle that classification of an imported article must rest upon its condition as imported." E. T. Horn Company v. United States, Slip Op. 2003-20, (CIT, 2003), (citing Carrington Co. v. United States, 61 CCPA 77, 497 F.2d 902, 905 (CCPA 1974), United States v. Baker Perkins, Inc., 46 CCPA 128, (1959)).
The HTSUS provisions under consideration are as follows:
1302 Vegetable saps and extracts; pectic substances, pectinates and pectates; agar-agar and other mucilages and thickeners, whether or not modified, derived from vegetable products:
Vegetable saps and extracts:
Other:
Ginseng; substances having anesthetic, prophylactic or therapeutic properties:
1302.19.40 Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
* * * * * * * * * * * *
Heterocyclic compounds with oxygen hetero-atom(s) only:
Other:
2932.99 Other:
Aromatic:
Other:
2932.99.61 Products described in additional U.S. note 3 to section VI .
* * * * * * * * * *
Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included:
Other:
Other:
Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances:
3824.90.28 Other
Chapter Note 1 to Chapter 29 states, in pertinent part, the following:
Except where the context otherwise requires, the headings of this chapter apply only to:
(a) Separate chemically defined organic compounds, whether or not containing impurities;
(b) Mixtures of two or more isomers of the same organic compound (whether or not containing impurities), except mixtures of acyclic hydrocarbon isomers (other than stereoisomers), whether or not saturated (chapter 27);
* * * * * *
EN 13.02 states, in pertinent part, the following:
(A) Vegetable saps and extracts.
The heading covers saps and extracts (vegetable products usually obtained by natural exudation or by incision, or extracted by solvents), provided that they are not specified or included in more specific headings of the Nomenclature (see list of exclusions at the end of Part (A) of this Explanatory Note).
These saps and extracts differ from the essential oils, resinoids and extracted oleoresins of heading 33.01, in that, apart from volatile odoriferous constituents, they contain a far higher proportion of other plant substances (e.g., chlorophyll, tannins, bitter principles, carbohydrates and other extractive matter).
The saps and extracts classified here include:
(1) Opium, the dried sap of the unripe capsules of the poppy (Papaver somniferum) obtained by incision of, or by extraction from, the stems or seed pods. It is generally in the form of balls or cakes of varying size and shape. However, concentrates of poppy straw containing not less than 50 % by weight of alkaloids are excluded from this heading (see Note 1 (f) to this Chapter).
* * * * *
(4) Pyrethrum extract, obtained mainly from the flowers of various pyrethrum varieties (e.g., Chrysanthemum cinerariaefolium) by extraction with an organic solvent such as normal hexane or “petroleum ether”.
* * * * *
(11) Quassia amara extract, obtained from the wood of the shrub of the same name (Simaroubaceae family), which grows in South America. Quassin, the principal bitter extract of the wood of the Quassia amara, is a heterocyclic compound of heading 29.32.
* * * * *
(18) Papaw juice, whether or not dried, but not purified as papain enzyme. (The agglomerated latex globules can still be observed on microscopic examination.) Papain is excluded (heading 35.07).
* * * * *
(20) Cashew nutshell extract. The polymers of cashew nutshell liquid extract are, however, excluded (generally heading 39.11).
* * * * *
Examples of excluded preparations are: . . .
Intermediate products for the manufacture of insecticides, consisting of pyrethrum extracts diluted by addition of mineral oil in such quantities that the pyrethrins content is less than 2 %, or with other substances such as synergists (e.g., piperonyl butoxide) added (heading 38.08).
All four of the substances in NY 814027 are obtained by sophisticated means such as solvent-solvent extraction, distillation, dialysis, chromatographic procedures, electrophoresis, etc. These processes result in a substance containing a targeted chemical compound or compounds along with ubiquitous plant material that need not be further removed for the manufacturers’ purpose.
Heading 1302, HTSUS, describes vegetable extracts. The ENs provide that vegetable products are usually obtained by natural exudation or by incision, or extracted by solvents. Furthermore, the EN distinguishes products of heading 1302, HTSUS, from products of heading 3301, HTSUS, by the amount of plant material they contain. Research into the extracts described by the ENs, however, reveals a variety of extraction and refining techniques. For instance, in HQ 963848, dated April 20, 2002, CBP took note of the EN that allows pyrethrum products containing over 2% pyrethrum to remain classified in heading 1302, HTSUS, in classifying a 50% pyrethrum product in heading 1302, HTSUS. We did so even though the original extracted oleoresin had been further purified removing much of the variety of material in the pyrethrum plant and thereby concentrating the pyrethrum content.
However, there appears to be a limit on the degree and extent of purification that can occur for the product to remain in heading 1302. For instance, EN 13.02, explicitly excludes certain refined extracts of opium, quassia amare, papaw juice, and cashew nut shell liquid, once the refining process concentrates a certain group of chemical compounds to a particular point. Hence, poppy straw concentrates containing more than 50% alkaloids are excluded from heading 1302. Likewise, quassin, a chemical compound extracted and refined from the quassia amara shrub is classified in Chapter 29. Papain enzyme, once purified from the extraction process of papaw juice, is classified as an enzyme of Chapter 37. And polymers extracted and refined from cashew nut shell liquid are classified in Chapter 39 as polymers.
Following the reasoning in our prior rulings, and the tenet that we must classify goods as imported, we note that the leucoanthocyanin consists of over 90% mixtures of oligomeric proanthocyanidins (OPCs) and the silymarin consists of at least 80% of isomers of silymarin. Therefore, silymarin and leucoanthocyanin are relatively pure chemical products and cannot be classified simply as extracts.
In HQ 964338 and in HQ 966566, silymarin and leucocyanin were each respectively classified in subheading 3824.90.28, HTSUS, the provision for "Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: Other." We consider this the correct result for leucoanthocyanin, because it is purified from the plant matter well beyond that of an extract, yet it does not contain a separate chemically defined compound, or isomers of such a compound, as necessary for classification in Chapter 29, HTSUS.
However, in HQ 964338, we excluded classification of silymarin 80% in Chapter 29, HTSUS, because the product consists of more than isomers of a separate chemically defined compound under Chapter 29, note 1(b). The other 20% is remainder from the starting material and a small amount of solvent. As such, we now consider this remainder to constitute “impurities” within the terms of the chapter note.
Within Chapter 29, silymarin is undisputedly a heterocyclic compound of heading 2932, HTSUS, as it includes six-membered rings containing oxygen atoms in the ring. Hence, heading 3824, a basket provision, can no longer describe this merchandise, which is more specifically provided for elsewhere. Using GRI 6, subheading 2932.99.61, HTSUS, describes this product as an other aromatic heterocyclic compound for which the CAS registry number is not listed in the Chemical Appendix under the terms of U.S. note 3 to section VI.
In regard to your contention in your comment that silymarin and leucoanthocyanin qualify as “medicaments” under subheading 3003.90.00.00, HTSUS, we find that these products are not medicaments of heading 3003, HTSUS, because they are neither intended nor sold for the treatment or prevention of any medical condition. As stated in the Explanatory Notes to Heading 3003, the heading covers “… medicinal preparations for use in the internal or external treatment or prevention of human or animal ailments.” Silymarin and leucoanthocyanin, however, are marketed and sold as dietary supplements, not medicaments. For a more complete discussion on medicaments and dietary supplements, see HQ 964673, dated February 4, 2002 (on the classification of Joint Advantage® tablets) and/or HQ 966771, dated September 15, 2004 (on the classification of “Promensil,” Red Clover).
HOLDING:
NY 814027, dated February 2, 1996,is modified as set forth above in regard to the classification of silymarin (identified as “Milk thistle (Silybum Marianum)”) and leucoanthocyanin (identified as “Leucoanthocyanins [(grape seed) Vitis Vinifera]”).
Silymarin is classified in subheading 2932.99.6100, HTSUSA (annotated), the provision for “Heterocyclic compounds with oxygen hetero-atom(s) only: Other: Other: Aromatic: Other: Products described in additional U.S. note 3 to section VI.” The column 1, general rate of duty under the 2006 HTSUS is 6.5% ad valorem, with reference to headings in Chapter 99, HTSUS.
Leucoanthocyanin is classified in subheading 3824.90.2800, HTSUSA, the provision for "Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Mixtures containing 5 percent or more by weight of one or more aromatic or modified aromatic substances: Other." The column 1, general rate of duty under the 2006 HTSUS is 6.5% ad valorem, with reference to headings in Chapter 99, 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 internet at www.usitc.gov.
EFFECT ON OTHER RULINGS:
NY 814027, dated February 2, 1996, is modified as set forth above in regard to the classification of silymarin (identified as “Milk thistle (Silybum Marianum)”) and leucoanthocyanin (identified as “Leucoanthocyanins [(grape seed) Vitis Vinifera]”). The classifications set forth in NY 814027 for other products remain effective.
In accordance with 19 U.S.C. 1625(c), this ruling will become effective 60 days after publication in the CUSTOMS BULLETIN.
Sincerely,
Myles B. Harmon, Director
Commercial Trade and Facilitation Division