CLA-2 RR:CTF:TCM 967757ptl
Port Director
Bureau of Customs and Border Protection
40 South Gay Street
Baltimore, MD 21202
RE: Protest 1303-04-100189; SoyLife Complex Products
Dear Port Director:
The following is our decision regarding the request for further review filed by importer’s counsel of Protest 1303-04-100189 against your decision which classified products described as Soylife Complex Regular, Soylife Complex Granular and Soylife Complex Micro in subheading 1901.90.9095, Harmonized Tariff Schedule of the United States (HTSUS), which provides for other food preparations of flour, groats, meal, starch or malt extract, not elsewhere specified or included.
FACTS:
The goods under protest are called “SoyLife Complex” by the manufacturer and are said to be three varieties of processed soybeans. These products are used in foods and dietary supplements, shakes and food bars. The protest covers three entries, made between February 2004 and April 2004. The goods were invoiced as “Flours, meals of soybeans” and classified by the importer in subheading 1208.10.0000, HTSUS, which provides for flours and
meals of oil seeds or oleaginous fruits, other than those of mustard, of soybeans. The entries were liquidated on September 3, 2004, and the goods were classified in subheading 1901.90.9095, HTSUS. A timely protest of this classification and application for further review (AFR) was received by CBP on October 13, 2004. The AFR was based upon the allegation of the existence of inconsistent CBP rulings with respect to the same or substantially same merchandise and was properly approved.
An information sheet provided by counsel describes the manufacturing process for SoyLife Complex as follows:
The soybeans are cleaned and cracked.
The cracked soybeans are screened and separated. The smaller cracked soybean particles naturally contain a higher percentage of soy germs. Soy germ comprises approximately 60 to 80 percent of the cracked whole soybean material, and the remaining 20 to 40 percent of the cracked whole soybean material is composed of soybean cotyledons and hulls.
The smaller cracked soybean particles are subjected to a moderate heat treatment (i.e., an air temperature of 250 to 300 degrees Fahrenheit during 45 minutes) that inactivates the lipolytic enzymes, eliminates anti-nutrient factors like trypsin, and de-bitters the soybeans.
The heat-treated smaller cracked soybean particles are cooled and milled to three particule sizes:
Coarse = SoyLife Complex granules
Regular = SoyLife Complex regular
Extra fine = SoyLife Complex micro
This process: the cracking of the soybeans, the separating the germ, the heating the germ, and, finally, the milling of the germ, creates a product with a much higher concentration of isoflavones than is found in a product made from milled whole soybeans. This product is then sold for use as an ingredient in products intended for human consumption.
ISSUE:
Whether ground meal of soybean germ is classified as a flour or meal of oil seeds in heading 1208, HTSUS, or a food preparation of flour or meal in heading 1901, HTSUS.
LAW AND ANALYSIS:
Merchandise is classifiable under the HTSUS in accordance with the General Rules of Interpretation (GRIs). The systematic detail of the HTSUS is
such that most 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, the remaining GRIs may then be applied in order.
In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes (ENs), although not dispositive or legally binding, provide a commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS subheadings under consideration are as follows:
1208 Flours and meals of oil seeds or oleaginous fruits, other than those of mustard:
1208.10.0000 Of soybeans.
1901 Malt extract; food preparations of flour, groats, meal, starch or malt extract, not containing cocoa or containing less than 40 percent by weight of cocoa calculated on a totally defatted basis, not elsewhere specified or included; food preparations of goods of headings 0401 to 0404, not containing cocoa or containing less than 5 percent by weight of cocoa calculated on a totally defatted basis, not elsewhere specified or included:
* * *
1901.90 Other:
* * *
1901.90.90 Other:
* * *
1901.90.9095 Other . . . .
As one of the principal arguments in support of his position that the product under consideration should be classified in heading 1208, HTSUS, counsel refers to Customs and Border Protection (CBP) Ruling HQ 959748,
dated July 1, 1997, which classified a product identified as “SoyLife Soybean Flour” in subheading 1208.10.00, HTSUS. Counsel contends that the good of that ruling and the good under instant consideration are the same. Counsel contends that CBP’s classification of the instant product in a heading different from that provided by HQ 959748 constitutes CBP’s revocation of that ruling without providing the importer with the requisite opportunity for notice and comment period required under the provisions of 19 U.S.C. 1625 and 19 CFR 177.12.
In HQ 959748, the product CBP classified was described as having been produced in the following manner:
Soybeans are cleaned, cracked, subjected to moderate heat treatment (an air temperature of 250 to 300 degrees Fahrenheit) that inactivates the lipolytic enzymes, eliminates anti-nutrient factors, and are cooled and milled to produce a full-fat flour.
The General EN to Chapter 12 provides, in relevant part:
The seeds and fruits covered by the headings may be whole, broken, crushed, husked or shelled. They may also have undergone moderate heat treatment designed mainly to ensure better preservation (e.g., by inactivating the lipolytic enzymes and eliminating part of the moisture), for the purpose of de-bittering or to facilitate their use. However, such treatment is permitted only if it does not alter the character of the seeds and fruits as natural products and does not make them suitable for a specific use rather than for general use.
The EN to heading 1208 provides:
This heading covers non-defatted or partially defatted flours or meals obtained by grinding the oil seeds or oleaginous fruits covered by headings 12.01 to 12.07. It also includes flours and meals defatted and wholly or partially refatted with their original oils (see Note 2 to this Chapter).
As directed by these ENs, when we are considering whether flours or meals are classifiable in heading 1208, we must first ascertain whether the substances that were ground to produce the flour or meal were oil seeds or oleaginous fruits, articles that are classifiable in headings 1201 to 1207.
In HQ 959748, the ground meal at issue was obtained by milling soybeans that had been cracked and subjected to moderate heat treatment. The case hinged on whether the heating of the cracked soybeans had created a prepared
food. “Soybean seeds, whether or not broken, are classified in heading 1201.00.00, HTSUS. If the soybeans are roasted or cooked, they are not classified in heading 1201.00.00, HTSUS, and are prepared foods not covered in Chapter 12.” In its analysis of the case, CBP determined that “the heat treatment, as described in the protest, is in accordance with technical and industry sources for stabilizing full-fat soy flour. Accordingly, we conclude that the soybeans were not cooked or roasted.” As a result, the goods were classified in Chapter 12.
However, the instant product differs in its production method from the product considered in HQ 959748. The instant product, the “SoyLife Complex” products, begins like the goods of HQ 959748, with regular soybeans which are cracked. However, at that point, the production methods differ. In order to obtain the “SoyLife Complex” product, the manufacturer says it screens the cracked soybeans to separate the smaller particles that “naturally contain a higher percentage of soy germs.” It is these smaller particles, not the entire oil seed of heading 1201, which are heated and ground into the meal. Thus, the products are not the same and do not need to be classified in the same headings. Because the products being classified are different, there is no need to revoke HQ 959748. Because HQ 959748 is not being revoked or modified, the notice and comment provisions of 19 U.S.C. 1625 and 19 CFR 177.12 do not apply.
The soy germ particles that are ground after having been separated from the remaining soybean cotyledons and hulls to become SoyLife Complex are not articles that are classifiable in heading 1201, HTSUS. The particles are no longer seeds. They have been processed into goods that have lost the character of seeds. By itself, soy germ which is intended to be further processed for human consumption would be classified in heading 1212, HTSUS, which provides for other vegetable products of a kind used primarily for human consumption, not elsewhere specified or included. However, the product under consideration consists of soy germ that has been ground into a flour or meal and has become prepared for a particular use (as an ingredient for health shakes, bars and other nutritional supplements) rather than for general use.
Because the product which was ground to produce the meal or flour is not a good of headings 1201 to 1207, the resulting flour cannot be classified in heading 1208. Further, the EN to heading 1208 states that the heading covers non-defatted or partially defatted flours. These are “full-fat” flours. “Full-fat” soy flour is described as being the product obtained from ground whole soybeans containing all of the original oil. (Soybean Utilization, Snyder, Harry E., 1987, p. 331) The product under review has been produced by grinding soy germ. Thus, it is a soy germ flour, not a soybean flour. Indeed, the product is so described in submissions provided by counsel for the protestant. Counsel has provided product ingredient listings that are intended to show the uses to which
the subject good is put. These ingredient lists have been annotated to highlight attention to an ingredient identified as “soy germ flour.”
Counsel asserts that the goods should be classified by application of GRI 2(b) which provides, in relevant part, “[a]ny reference to goods of a given material or substance shall be taken to include a reference to goods consisting wholly or partly of such material or substance.” Counsel claims that the product under consideration consists “wholly or partially” of soybean flour and, therefore, should be classified in subheading 1208.10, HTSUS, as a soybean flour. However, EN XII to GRI 2(b) states, in relevant part, that “[i]t [Rule 2(b)] does not, however, widen the heading so as to cover goods which cannot be regarded, as required under Rule 1, as answering the description in the heading.” The material that is ground to produce the SoyLife Complex products is not soybeans as described in heading 1201, HTSUS. Rather, the material is soybean germ, which is not described by the terms of headings 1201 to 1207, HTSUS. Further, the SoyLife Complex product does not have the character of a soybean flour. It is specially manufactured and marketed as a separate and distinctly different product. Accordingly, subheading 1208 cannot be widened to include it.
Accordingly, the products SoyLife Complex Regular, SoyLife Complex Granular and SoyLife Complex Micro are classified as food preparations of flour, groats, meal, starch or malt extract, in heading 1901.90.9095, HTSUS.
HOLDING:
The soy germ flour of the products SoyLife Complex Regular, SoyLife Complex Granular and SoyLife Complex Micro, are classified in subheading 1901.90.9095, HTSUS, which provides for “Malt extract; food preparations of flour, groats, meal, starch or malt extract, not containing cocoa or containing less than 40 percent by weight of cocoa calculated on a totally defatted basis, not elsewhere specified or included; food preparations of goods of headings 0401 to 0404, not containing cocoa or containing less than 5 percent by weight of cocoa calculated on a totally defatted basis, not elsewhere specified or included: other: … other: other.” The 2004 duty rate was 6.4% per kilogram (Kg).
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 www.usitc.gov.
The protest should be DENIED in accordance with the above decision. In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division