CLA-2 OT:RR:CTF:TCM H236614 LWF
Port Director
Service Port – San Francisco
555 Battery Street
San Francisco, CA 94111-2316
Attn: Frank Djeng, Import Specialist
RE: Internal Advice Request; Classification of oolong tea leaves fermented with ginseng from Taiwan
Dear Port Director:
This is in reference to your memorandum, dated November 15, 2012, forwarding a request for internal advice, dated September 19, 2012, initiated by the Law Offices of Gary C. Cooper, on behalf of its client, Ten Ren Tea Co. of San Francisco, Ltd. (“Ten Ren”). At issue is the proper classification under the Harmonized Tariff Schedule of the United States (HTSUS) of oolong tea leaves that have been fermented in a ginseng solution. The request for internal advice is sought based upon Ten Ren’s disagreement with a determination by U.S. Customs and Border Protection (CBP) that the instant tea is classified under subheading 2101.20.90, HTSUS.
FACTS:
The merchandise is described as loose oolong tea that consists of dried tea leaves derived from the Camellia genus of flowering plants (the “Tea”). During processing in Taiwan, the Tea is soaked in a water solution containing 3% ginseng powder by volume, thereby imbuing the Tea with a distinct flavor as compared to other oolong teas that are not processed in a ginseng solution. After soaking, the Tea is dried, packaged in bulk, and shipped to the United States.
This Internal Advice ruling concerns multiple entries of the Tea by Ten Ren at the Service Port of San Francisco, during the period of July 9, 2007 through July 9, 2012. Specifically, we address the Port’s inquiry as to whether Ten Ren’s merchandise is classified in subheading 2101.20.90, HTSUS, which provides for “Extracts, essences and concentrations, of coffee, tea or maté and preparations with a basis of these products or with a basis of coffee, tea or maté; roasted chicory and other roasted coffee substitutes, and extracts, essences and concentrates thereof: Extracts, essences and concentrations, of coffee, tea or maté and preparations with a basis of these products or with a basis of coffee, tea or maté: Other: Other: Other.” Ten Pen asserts that the Tea is appropriately classified under subheading 0902.30.00, HTSUS, which provides for “Tea, whether or not flavored: Black tea (fermented) and partly fermented tea, in immediate packings of a content not exceeding 3kg,” and subheading 0902.40.00, HTSUS, which provides for “Tea, whether or not flavored: Other black tea (fermented) and other partly fermented tea.”
ISSUE:
Whether Ten Ren’s oolong tea is classified under heading 0902, HTSUS, as flavored tea, or heading 2101, HTSUS, as a preparation with a basis of tea?
LAW AND ANALYSIS:
Merchandise imported in the United States 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, which requires otherwise, by the Additional U.S. Rules of Interpretation. GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order.
The following HTSUS provisions will be referenced:
0902 Tea, whether or not flavored:
0902.30.00 Black tea (fermented) and partly fermented tea, in immediate packings of a content not exceeding 3kg.
0902.40.00 Other black tea (fermented) and other partly fermented tea.
* * *
2101 Extracts, essences and concentrations, of coffee, tea or maté and preparations with a basis of these products or with a basis of coffee, tea or maté; roasted chicory and other roasted coffee substitutes, and extracts, essences and concentrates thereof:
2101.20 Extracts, essences and concentrations, of coffee, tea or maté and preparations with a basis of these products or with a basis of coffee, tea or maté:
Other:
Other:
2101.20.90 Other.
* * *
Note 1(c) to Chapter 21 states, in pertinent part, the following:
This chapter does not cover:
(c) Flavored tea (heading 0902);
* * *
In understanding the language of 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 Harmonized System at the international level. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
EN 09.02 states, in pertinent part, as follows:
This heading cover the different varieties of tea derived from the plants of the botanical genu Thea (Camellia).
…
This heading also includes partly fermented tea (e.g., Oolong tea).
…
Tea which has been been flavoured by a steaming process (during fermentation, for example) or by the addition of essential oils (e.g., lemon or bergamot oil), artificial flavourings (which may be in crystalline or powder form) or parts of various other aromatic plants or fruits (such as jasmine flowers, dried orange peel or cloves) is also classified in this heading.
…
The heading further excludes products not derived from the plants of the botanical genus Thea but sometimes called “teas,” e.g.:
…
(c) Ginseng “tea” (a mixture of ginseng extract with lactose or glucose) (heading 21.06).
* * *
Heading 0902, HTSUS, provides for tea, whether or not flavored. Specifically, subheadings 0902.30.00 and 0902.40.00, HTSUS provide, in relevant part, for fermented tea as described by packed weight. The term “flavored tea” is not defined in the HTSUS or the ENs. However, EN 09.02 states that the heading covers “the different varieties of tea derived from the plants of the botanical genus Thea (Camellia)” and includes “tea which has been flavoured by a steaming process (during fermentation, for example) or by the addition of essential oils (e.g., lemon or bergamot oil), artificial flavourings (which may be in crystalline or powder form) or parts of various other aromatic plants or fruits (such as jasmine flowers, dried orange peel or cloves).” EN 09.02 further states that the heading includes “partly fermented tea (e.g., Oolong tea) (emphasis added).
The instant merchandise is described as an oolong tea that consists of the dried leaves of flowering plants of the Camellia genus. During processing, the Tea is soaked in a ginseng solution of water mixed with 3% powered ginseng, imbuing the Tea with what Ten Ren describes as a “distinctive and lingering aftertaste not found in unflavored oolong teas.” We note that although the Tea is fermented in a ginseng powder solution during processing, the tea leaves are not blended with any other natural or artificial flavoring products upon drying. Compare New York Ruling Letter (“NY”) N041686, dated November 14, 2008 (classifying tea blended with lime peel, dandelion leaf, black Darjeeling tea, cucumber, peppermint, lemon myrtle, natural flavors and lime essence oil in subheading 2101.20.90, HTSUS), with NY J87907, dated September 10, 2003 (classifying various selections of unblended teas, individually flavored with bergamot oil, natural and artificial vanilla flavor, or lemon flavor, in subheading 0902.30.00, HTSUS). As such, the Tea is accurately described as a “flavored tea,” consistent with the examples provided by EN 09.02.
Note 1(c) to Chapter 21 excludes “flavored tea” from classification in Chapter 21 and states that such articles are properly classified in heading 0920, HTSUS. Consequently, because the Tea consists entirely of oolong tea that has been “flavored” via processing in a ginseng solution, it is considered a “flavored tea” and is excluded from classification in Chapter 21. Pursuant to GRI 1, the Tea is classified in heading 09.02, HTSUS, which provides for “Tea, whether or not flavored.”
HOLDING:
By application of GRI 1, Ten Ren’s oolong tea, fermented with ginseng, is classified in heading 0902, HTSUS. Specifically, depending on the weight by which it is packaged, the Tea is classifiable in subheadings 0902.30.00, HTSUS, which provides for “Tea, whether or not flavored: Black tea (fermented) and partly fermented tea, in immediate packings of a content not exceeding 3kg,” or subheading 0902.40.00, HTSUS, which provides for “Tea, whether or not flavored: Other black tea (fermented) and other partly fermented tea.” The column one, general rate of duty for subheadings 0902.30.00 and 0902.40.00, HTSUS, is free.
You are to mail this decision to counsel for the internal advice requester no later than sixty days from the date of this decision. At that time, the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public, on the CBP Hope Page at http://www.cbp.gov, by means of the Freedom of Information Act, and other methods of publication.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division