CLA-2 RR:CR:GC964377 nel/JGB
Mr. Flemming Soderlund
F. Soderlund Co., Inc.
9240 Bonita Beach Road, Suite 1118
Bonita Springs, FL 34135
RE: Butterfat mixture
Dear Mr. Soderlund:
This is in reference to your letter of May 17, 2000, to Customs National Commodity Specialist Division, concerning the classification of an anhydrous milkfat mixture under the Harmonized Tariff Schedule of the United States (HTSUS). New York Letter (NY) F87650 dated July 19, 2000, advised you that your request was referred to this office. We regret the delay.
FACTS:
In your letter you requested a tariff classification ruling on a product identified as Confectionery Mix AMF 9703, 97.0% milkfat, 3.0% granulated or powdered sugar made from sugar cane or sugar beet, and 0.1% moisture. This product will be imported from Australia, frozen in 25-kilogram cartons, to be used to manufacture confectionery food items.
ISSUE:
What is the tariff classification under the HTSUS of a certain mixture of an anhydrous milkfat (97% by weight) with an additional ingredient (3% by weight).
LAW & ANALYSIS:
The General Rules of Interpretation (GRIs) taken in their appropriate order provide a framework for classification of merchandise under the
HTSUS. The majority of imported goods are classified by application of GRI 1; that is, 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, then the remaining GRIs may be applied.
The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System constitute the official interpretation of the tariff system at the international level. Though not dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS. Customs believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
The HTSUS headings under consideration are as follows:
0405 Butter and other fats and oils derived from milk; dairy spreads.
Food preparations not elsewhere specified or included.
Note 2(a) to chapter 4, HTSUS, defines “butter” as “… derived exclusively from milk, with a milkfat content of 80 percent or more but not more than 95 percent by weight, a maximum milk solids-not-fat content of 2 percent by weight and a maximum water content of 16 percent by weight. Butter does not contain added emulsifiers, but may contain sodium chloride, food colors, neutralizing salts and cultures of harmless … bacteria.”
Note 2(b) to chapter 4, HTSUS, defines “dairy spreads” as “a spreadable emulsion of the water-in-oil type, containing milkfat as the only fat in the product, and having a milkfat content of 39 percent or more but less than 80 percent by weight.” According to EN 04.05(B), dairy spreads “may contain optional ingredients such as cultures of harmless … bacteria, vitamins, sodium chloride, sugar, gelatine, starches; food colours; flavours; emulsifiers; thickening agents and preservatives.”
The composition of the goods classified in heading 0405, HTSUS, is discussed in EN 04.05. It is in these notes that “other fats and oils derived from milk” are described.
This group covers fats and oils derived from milk (e.g., milkfat, butterfat and butteroil). Butteroil is the product obtained by extracting the water and non-fat content from butter or cream.
This group further includes dehydrated butter and ghee (a kind of butter made most commonly from the milk of buffaloes or cows), as well as products consisting of a mixture of butter and small quantities of herbs, spices, flavourings, garlic, etc. (provided they retain the character of the products falling in this heading).”
Milkfat, butterfat, butteroil, and ghee are virtually pure fatty substances. Subheading note 2 to chapter 4 specifically excludes dehydrated butter and ghee from subheading 0405.10, HTSUS, which provides for: Butter, and places these anhydrous milkfat products under subheading 0405.90, HTSUS.
The General Explanatory Note (I) to chapter 4 lists the various dairy products provided for in the chapter. It also specifies the dairy products which, in addition to natural milk constituents, may contain certain additives, such as, stabilizing agents, antioxidants, vitamins not normally found in these products, processing chemicals and anti-caking agents. Butter, other fats and oils derived from milk, and dairy spreads of heading 0405, HTSUS, are not included in the list of products that may contain these additives.
In summary, heading 0405, HTSUS, based on the definitions above, includes “butter,” a spreadable emulsion which may contain a small number of permitted additives; “dairy spreads,” which are spreadable water-in-oil type emulsions containing a larger range of permitted additive ingredients; and “other fats and oils derived from milk,” which – except for flavored butter -- are virtually pure milkfat substances. Thus, it appears that within heading 0405, HTSUS, only certain additives are permitted and those additives are permitted only in spreadable emulsions such as butter, dairy spreads, and flavored butter. The requisite purity of the fat content precludes any additives in anhydrous milkfat, butterfat, butteroil, or ghee.
Heading 2106, HTSUS, provides for: Food preparations not elsewhere specified or included, and may be considered only when a more specific provision is not available. The ENs to the heading permit the inclusion of certain milkfat products “[p]rovided that they are not covered by any other heading of the Nomenclature, [for example]: … (3) Preparations based on butter or other fats or oils derived from milk and used, e.g., in bakers’ wares.”
The milkfat mixture under consideration consists of anhydrous milkfat and an additional ingredient. This in not the water-in-oil type emulsions, which by the terms of their definitions, are permitted additives under heading
0405, HTSUS. Accordingly, mixtures of anhydrous milkfat or butteroil with sweeteners or other non-milkfat ingredients are precluded from classification within heading 0405, HTSUS. Anhydrous butterfat mixtures of similar proportions (95% anhydrous milkfat and 5% other ingredient) were classified in HQ 964707 as food preparations not elsewhere specified or included under subheading 2106.90, HTSUS. Similarly, the instant product is classifiable under subheading 2106.90, HTSUS, which provides for: Food preparations not elsewhere specified or included. See HQ 964707 of this date, for our complete analysis of the classification of mixtures containing butterfat (95% by weight) and sugar (5% by weight). See also NY E84547 dated August 3, 1999, NY E89271 dated December 17, 1999, (modified by HQ 964706 of this date), and HQs 964375 and 964376 of this date.
HOLDING:
The butterfat product identified as a mixture of anhydrous milkfat (97% by weight) and an additional ingredient (3% by weight) of sugar is classifiable under subheading 2106.90.6400, HTSUS, which provides for: Food preparations not elsewhere specified or included: Other: Other: Other: Containing over 10 percent by weight of milk solids: Other, dairy products described in additional U.S. note 1 to chapter 4: Described in additional U.S. note 10 to chapter 4 and entered pursuant to its provisions. If entered after the quantity limitations of the tariff rate have been reached, these products are classifiable in subheading 2106.90.6600, HTSUS, the residual subheading for the quota provisions. Further, goods which are classifiable in subheading 2106.90.6600 are subject to additional safeguard duties listed in subheadings 9904.04.50 – 9904.05.01, HTSUS.
Sincerely,
John Durant, Director
Commercial Rulings Division