OT:RR:CTF:FTM H316413 TSM
Mr. George C. Lovequist
Access Business Group International LLC
7575 Fulton Street East
Ada, MI 49355
Re: Revocation of NY N314621; Tariff classification of dietary supplements from Colombia
Dear Mr. Lovequist:
This is in reference to New York Ruling Letter (“NY”) N314621, issued to Access Business Group International LLC, on October 1, 2020. In that ruling, U.S. Customs and Border Protection (“CBP”) classified products described as “Amway Immunity Gummies” and “Amway Sleep Gummies” under subheading 2106.90.9500, Harmonized Tariff Schedule of the United States (Annotated) (“HTSUSA”), which provides for “Food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17: Described in additional U.S. note 8 to chapter 17 and entered pursuant to its provisions.” We have reviewed NY N314621 and found it to be incorrect. For the reasons set forth below, we are revoking NY N314621.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. § 1625 (c)(1)), as amended by section 623 of title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057), a notice was published in the Customs Bulletin, Volume 55, No. 10, on March 17, 2021, proposing to revoke NY N314621, and revoke any treatment accorded to substantially identical transactions. No comments were received in response to the notice.
FACTS:
In NY N314621, the products at issue were described as follows:
The first product, “Amway Immunity Gummies”, is said to contain organic sugar, organic tapioca syrup, water, vitamin C, glycerin, elderberry extract, agar, flavors consisting of elderberry, lemon and masking flavors, zinc, lactic acid and citric acid.
The second product, “Amway Sleep Gummies”, is said to contain organic sugar, organic tapioca syrup, water, magnesium, glycerin, agar, lactic acid, citric acid, blueberry and lavender flavors, magenta color, melatonin, and passion flower extract.
Ingredients breakdowns, a manufacturing flowchart and photocopies of the packaging were provided to CBP for consideration.
ISSUE:
What is the tariff classification of the dietary supplement products at issue?
LAW AND ANALYSIS:
Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRIs”). GRI 1 provides that the classification of goods shall be determined 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 2 through 6 may then be applied in order.
The 2021 HTSUSA provisions under consideration are as follows:
2106 Food preparations not elsewhere specified or included:
2106.90 Other:
Other:
Other:
Other:
Other:
Articles containing over 10 percent by dry
weight of sugar described in additional U.S.
note 3 to chapter 17:
2106.90.9500 Described in additional U.S. note 8 to chapter 17 and entered pursuant to its provisions
* * *
2106.90.98 Other:
* * *
Other:
* * *
Other:
* * *
Other:
2106.90.9897 Containing
sugar derived from sugar cane and/or sugar beets
* * *
Additional U.S. Note 3 to Chapter 17, HTSUS, reads the following:
For the purposes of this schedule, the term “articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17” means articles containing over 10 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, except (a) articles not principally of crystalline structure or not in dry amorphous form, the foregoing that are prepared for marketing to the ultimate consumer in the identical form and package in which imported; (b) blended syrups containing sugars derived from sugar cane or sugar beets, capable of being further processed or mixed with similar or other ingredients, and not prepared for marketing to the ultimate consumer in the identical form and package in which imported; (c) articles containing over 65 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, capable of being further processed or mixed with similar or other ingredients, and not prepared for marketing to the ultimate consumer in the identical form and package in which imported; or (d) cake decorations and similar products to be used in the same condition as imported without any further processing other than the direct application to individual pastries or confections, finely ground or masticated coconut meat or juice thereof mixed with those sugars, and sauces and preparations therefor.
* * *
Additional U.S. Note 8 to Chapter 17, HTSUS, reads the following:
The aggregate quantity of articles containing over 10 percent by dry weight of sugars described in additional U.S. note 3 to chapter 17, entered under subheadings 1701.91.54, 1704.90.74, 1806.20.75, 1806.20.95, 1806.90.55, 1901.90.56, 2101.12.54, 2101.20.54, 2106.90.78 and 2106.90.95 during the 12-month period from October 1 in any year to the following September 30, inclusive, shall not exceed 64,709 metric tons (articles the product of Mexico shall not be permitted or included under this quantitative limitation and no such articles shall be classifiable therein).
* * *
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 neither dispositive nor 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). The EN to heading 2106, HTSUS, states, in pertinent part, the following:
Provided that they are not covered by any other heading of the Nomenclature, this heading covers:
Preparations for use, either directly or after processing (such as cooking, dissolving or boiling in water, milk, etc.), for human consumption.
Preparations consisting wholly or partly of foodstuffs, used in the making of beverages or food preparations for human consumption. The heading includes preparations consisting of mixtures of chemicals (organic acids, calcium salts, etc.) with foodstuffs (flour, sugar, milk powder, etc.), for incorporation in food preparations either as ingredients or to improve some of their characteristics (appearance, keeping qualities, etc.) (see the General Explanatory Note to Chapter 38).
* * *
The heading includes, inter alia:
* * *
(16) Preparations, often referred to as food supplements or dietary supplements, consisting of, or based on, one or more vitamins, minerals, amino acids, concentrates, extracts, isolates or the like of substances found within foods, or synthetic versions of such substances, put up as a supplement to the normal diet. It includes such products whether or not also containing sweeteners, colours, flavours, odoriferous substances, carriers, fillers, stabilisers or other technical aids. Such products are often put up in packaging with indications that they maintain general health or well-being, improve athletic performance, prevent possible nutritional deficiencies or correct sub-optimal levels of nutrients.
* * *
In NY N314621, CBP classified the “Amway Immunity Gummies” and “Amway Sleep Gummies” under subheading 2106.90.9500, HTSUSA, which provides for “Food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17: Described in additional U.S. note 8 to chapter 17 and entered pursuant to its provisions.”
Heading 2106, HTSUS, provides for “Food preparations, not elsewhere specified or included.” Thus, in order for a product to fall under heading 2106, HTSUS, two criteria must be met. First, the product must be a food preparation, and second, the food preparation must not be classified in the tariff more specifically elsewhere. See R.T. Foods, Inc. v. United States, 887 F. Supp. 2d 1351, 1358 (C.I.T. 2012) (stating that heading 2106 was an “expansive basket heading that only applies in the absence of another applicable heading”). The terms “food,” “preparation,” and “food preparation” are not defined in the HTSUS. EN 21.06 provides two definitions for the phrase “food preparation”. See EN (A) and EN (B) to 21.06. The first definition for the phrase “food preparation” is “Preparations for use, either directly or after processing … for human consumption”. See EN (A) 21.06.
In Orlando Food Corp. v. United States, 140 F.3d 1437, 1441 (Fed. Cir. 1994), the Court of Appeals for the Federal Circuit (CAFC) stated that:
Inherent in the term “preparation” is the notion that the object involved is destined for a specific use. The relevant definition from The Oxford English Dictionary defines “preparation” as “a substance specially prepared, or made up for its appropriate use or application, e.g. as food or medicine, or in the arts or sciences.” (internal citations omitted.)
Upon review, we find that the “Amway Immunity Gummies” and “Amway Sleep Gummies” products at issue are “food preparations” of heading 2106, HTSUS, because they contain substances with nutritive value and are preparations for human consumption that provide general health and well-being benefits not meant to treat or prevent any specific diseases. Accordingly, they are of the kind of preparations described in EN 21.06 (A)(16) and not more specifically classified elsewhere. However, the products at issue are not classified under subheading 2106.90.9500, HTSUSA, because they fall within one of the exceptions to Additional U.S. Note 3 to Chapter 17.
Additional U.S. Note 3 to Chapter 17 provides in relevant part that the term “ ‘articles containing over 10 percent by dry weight of sugar described in additional U.S. note 3 to chapter 17’ means articles containing over 10 percent by dry weight of sugars derived from sugar cane or sugar beets, whether or not mixed with other ingredients, except (a) articles not principally of crystalline structure or not in dry amorphous form, the foregoing that are prepared for marketing to the ultimate consumer in the identical form and package in which imported.” While the “Amway Immunity Gummies” and “Amway Sleep Gummies” contain over 10 percent of sugar derived from sugar cane (based on the products’ ingredient breakdown that accompanied the original request for a ruling), the products at issue are not “principally of crystalline structure” or “in dry amorphous form” when they are imported and prepared for marketing to the ultimate consumer. In fact, the “Amway Immunity Gummies” and “Amway Sleep Gummies” are imported and marketed to the ultimate consumer in solid form, specifically in the form of nutritional supplement gummies. Because the products at issue fall within one of the exceptions to U.S. Note 3 to Chapter 17, it follows that the quantitative limitations of Additional U.S. Note 8 to Chapter 17, HTSUS, also do not apply to these products. Therefore, as referenced above the “Amway Immunity Gummies” and “Amway Sleep Gummies” are not classified in subheading 2106.90.9500, HTSUSA.
The products at issue in NY N314621 are nutritional supplements consisting of substances with nutritive value, imported and prepared for marketing to the ultimate consumer in solid form, specifically in the form of nutritional supplement gummies, and containing sugar derived from sugar cane. Therefore, we find that they are described by heading 2106, HTSUS, and specifically by subheading 2106.90.9897, HTSUSA, which provides for “Food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Other: Other: Other: Other: Containing sugar derived from sugar cane and/or sugar beets.” See NY N314583, dated October 13, 2020 (classifying dietary supplements imported and prepared for marketing to the ultimate consumer in the form of nutritional supplement gummies containing sugar derived from sugar cane, under subheading 2106.90.9897, HTSUSA.)
HOLDING:
By application of GRIs 1 and 6, we find that “Amway Immunity Gummies” and “Amway Sleep Gummies” are classified under heading 2106, HTSUS, and specifically under subheading 2106.90.9897, HTSUSA, which provides for “Food preparations not elsewhere specified or included: Other: Other: Other: Other: Other: Other: Other: Other: Other: Containing sugar derived from sugar cane and/or sugar beets.” The 2021 column one, general rate of duty is 6.4% ad valorem.
EFFECT ON OTHER RULINGS:
NY N314621, dated October 1, 2020, is hereby REVOKED.
In accordance with 19 U.S.C. § 1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
For Craig T. Clark, Director
Commercial and Trade Facilitation Division