OT:RR:CTF:FTM H317626 PJG
Ms. Catherine Weeks
Casas International Brokerage, Inc.
6775 Customhouse Plaza, Suite J
Otay Mesa, California 92073
RE: Revocation of HQ H259324, HQ H258812, NY 856914, and HQ 085838; Modification of NY N195658, NY D88850, NY 890395, and HQ 088976; Classification of sauces; Revocation by operation of law; Mondiv, Div. of Lassonde Specialties Inc. v. United States, 329 F. Supp. 3d 1331 (Ct. Int’l Trade 2018); Mild Jalapeno Red Salsa and Mild Jalapeno Green Salsa
Dear Ms. Weeks:
This is in reference to New York Ruling Letter (“NY”) NY 856914, dated October 24, 1990, issued to you concerning the tariff classification under the Harmonized Tariff Schedule of the United States (“HTSUS”) of two types of salsa, specifically, a Mild Jalapeno Red Salsa and a Mild Jalapeno Green Salsa.
In NY 856914, U.S. Customs (the predecessor to U.S. Customs and Border Protection (“CBP”)) classified the Mild Jalapeno Red Salsa in heading 2005, HTSUS, which in the 1990 version of the HTSUS provided for “Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen” and classified the Mild Jalapeno Green Salsa in heading 2008, HTSUS, which provides for “Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included.”
We have reviewed NY 856914 and find it to be in error. For the reasons set forth below, we revoke NY 856914 and Headquarters Ruling Letter (“HQ”) 085838, dated December 21, 1989, and modify NY N195658, dated January 4, 2012, NY D88850, dated May 12, 1999, NY 890395, dated October 15, 1993, and HQ 088976, dated January 6, 1992, which concern substantially similar merchandise. Furthermore, HQ H259324, dated September 3, 2015, and HQ H258812, dated September 3, 2015, are revoked by operation of law in light of the U.S. Court of International Trade’s (“CIT’s”) decision in Mondiv, Div. of Lassonde Specialties Inc. v. United States, 329 F. Supp. 3d 1331 (Ct. Int’l Trade 2018).
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. No. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed action was published on September 11, 2024, in Volume 58, Number 36, of the Customs Bulletin. No comments were received in response to this notice.
FACTS:
In NY 856914, the Mild Jalapeno Red Salsa and Mild Jalapeno Green Salsa were described as follows:
[the] Mild Jalapeno Red Salsa is composed of red tomatoes, water, onions,
jalapeno peppers, coriander, salt, citric acid and sodium benzoate. The product has a fairly loose but lumpy consistency, and contains many small pieces of tomato, tomato seeds, onions and peppers. Mild Jalapeno Green Salsa is made from tomatillos, water, jalapeno peppers, onions, coriander, salt, citric acid and
sodium benzoate. This product has a very loose consistency and, like the red salsa, contains a large quantity of tomatillo pieces and seeds, peppers and onions. Both salsas are put up in glass jars containing 18 ounces, net weight.
CBP classified the Mild Jalapeno Red Salsa in subheading 2005.90.95, HTSUS, which in the 1990 version of the HTSUS provided for “Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen: Other vegetables and mixtures of vegetables: Other” and classified the Mild Jalapeno Green Salsa in subheading 2008.99.90, HTSUS, which in the 1990 version of the HTSUS provided for “Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included: Other, including mixtures other than those of subheading 2008.19: Other: Other: Other.”
ISSUES:
Whether the Mild Jalapeno Red Salsa is classified as a sauce in heading 2103, HTSUS, or in heading 2005, HTSUS, which provides for “Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen, other than products of heading 2006.”
Whether the Mild Jalapeno Green Salsa is classified as a sauce in heading 2103, HTSUS, or in heading 2008, HTSUS, which provides for “Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included.”
LAW AND ANALYSIS:
Classification under the Harmonized Tariff Schedule of the United States (“HTSUS”) is made in accordance with the General Rules of Interpretation (“GRI”). 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 GRI may then be applied.
The 2024 HTSUS provisions under consideration are as follows:
2005 Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen, other than products of heading 2006:
2008 Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included:
2103 Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard:
Note 3 to Chapter 20, HTSUS, provides as follows:
Heading 2001, 2004 and 2005 cover, as the case may be, only those products of chapter 7 or of heading 1105 or 1106 (other than flour, meal and powder of the products of chapter 8), which have been prepared or preserved by processes other than those referred to in note 1(a).
The Harmonized Commodity Description and Coding System Explanatory Notes
(“EN”) constitute the “official interpretation of the Harmonized System” at the international level. See 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). While neither legally binding nor dispositive, the ENs “provide a commentary on the scope of each heading” of the HTSUS and are “generally indicative of [the] proper interpretation” of these headings. See id.
The EN to 21.03(A) provides as follows:
(A) SAUCES AND PREPARATIONS THEREFOR; MIXED CONDIMENTS AND MIXED SEASONINGS
This heading covers preparations, generally of a highly spiced character, used to flavour certain dishes (meat, fish, salads, etc.), and made from various ingredients (eggs, vegetables, meat, fruit, flours, starches, oil, vinegar, sugar, spices, mustard, flavourings, etc.). Sauces are generally in liquid form and preparations for sauces are usually in the form of powders to which only milk, water, etc. need to be added to obtain a sauce.
Sauces are normally added to a food as it cooks or as it is served. Sauces provide flavour, moisture, and a contrast in texture and colour. They may also serve as a medium in which food is contained, for example, the velouté sauce of creamed chicken. Seasoning liquids (soy sauce, hot pepper sauce, fish sauce) are used both as ingredients in cooking and at table as condiments.
The heading also includes certain preparations, based on vegetables or fruit, which are mainly liquids, emulsions or suspensions, and sometimes contain visible pieces of vegetables or fruit. These preparations differ from prepared or preserved vegetables and fruit of Chapter 20 in that they are used as sauces, i.e., as an accompaniment to food or in the preparation of certain food dishes, but are not intended to be eaten by themselves.
* * *
Examples of products covered by the heading are : mayonnaise, salad dressings, Béarnaise, bolognaise (consisting of chopped meat, tomato purée, spices, etc.), soya sauces, mushroom sauce, Worcester sauce (generally made with a base of thick soya sauce, an infusion of spices in vinegar, with added salt, sugar, caramel and mustard), tomato ketchup (a preparation made from tomato purée, sugar, vinegar, salt and spices) and other tomato sauces, celery salt (a mixture of cooking salt and finely ground celery seeds), certain mixed seasonings for sausage making, and products of Chapter 22 (other than those of heading 22.09) prepared for culinary purposes and thereby rendered unsuitable for consumption as beverages (e.g., cooking wines and cooking Cognac). This heading also covers mixtures of plants or parts of plants of heading 12.11 of a kind used for seasoning sauces.
In Mondiv, Div. of Lassonde Specialties Inc. v. United States, 329 F. Supp. 3d 1331 (Ct. Int’l Trade 2018), the Court of International Trade (“CIT”) considered the tariff classification of an artichoke antipasto and a green olive tapenade. The court considered the classification of the products in headings 2005, HTSUS, as “[o]ther vegetables prepared or preserved” and heading 2103, HTSUS, as “sauces.” For heading 2005, HTSUS, the court stated that the products “must be[:] (1) vegetables listed in Chapter 7; (2) ready for cooking or eating, or treated to prevent its decomposition; (3) preserved by a means other than pickling in vinegar or acetic acid; (4) not frozen; and (5) not preserved with sugar.” Id. at 1341. The court applied these factors and determined that the products were prima facie classifiable in heading 2005, HTSUS. Id.
Preceding the Mondiv decision, specifically, in Nestle Refrigerated Food Co. v. United States, 18 C.I.T. 661 (1994), the CIT considered the common meaning of the term “sauce” in order to understand the meaning of the words “other tomato sauces,” which is found in subheading 2103.20.40, HTSUS. In doing so, the court considered the seminal decision of Bogle v. Malone, wherein the U.S. Supreme Court determined the following:
The word “sauce,” as commonly used, designates a condiment, generally but not always of liquid form, eaten as an addition to and together with a dish of food, to give it flavor and make it more palatable; and is not applied to anything which is eaten, alone or with a bit of bread, either for its own sake only, or to stimulate the appetite for other food to be eaten afterwards.
Nestle Refrigerated Food Co., 18 C.I.T. at 668 (citing Bogle v. Malone, 152 U.S. 623, 625-26 (1894)) (subsequently followed by Del Gaizo Distrib. Corp. v. United States, 24 C.C.P.A. 64, T.D. 48376 (1936)). The Nestle court concluded that the U.S. Supreme Court’s definition “is consistent with the Oxford English Dictionary, which defines ‘sauce’ as ‘any preparation, usually liquid or soft, and often consisting of several ingredients, intended to be eaten as an appetizing accompaniment to some article of food.’” Id. at 668 (citing 14 Oxford English Dictionary 512 (2d ed. 1989)). The Nestle court found that there are two prerequisites for “other tomato sauces”, specifically: “(1) the product must be a sauce; and (2) tomatoes must be the primary ingredient of that sauce.” Id. at 669. Moreover, the court stated that this provision may apply to smooth tomato sauces and “other non-standardized tomato-based sauces, such as pasta sauces, chili sauces, barbecue sauces, and pizza sauces.” Id. The court further indicated that chunky sauces are also encompassed by the term “other tomato sauces.” Id.
The CIT in Mondiv determined that the term “sauces” under heading 2103, HTSUS, is an eo nomine provision, and then proceeded to further clarify the scope of the term “sauces” of heading 2103, HTSUS, from what had been previously determined by the CIT in Nestle and the U.S. Supreme Court in Bogle. Mondiv, 329 F. Supp. 3d at 1342. The term “sauce” is not defined in the HTSUS, therefore, the court considered the EN to 21.03 and several reference sources and determined that the term “sauce” as it is used in heading 2103, HTSUS, means “a mixture of ingredients in liquid or semisolid form that adds flavoring to food.” Id.
The court then turned to the products that were at issue and stated that both products were semisolid in form because they were “chunky mixtures of ingredients with discernible pieces of vegetables.” Id. at 1342-1343. Next, the court determined that the combination of ingredients in each of the products flavored the food and, therefore, the two products were also prima facie classifiable in heading 2103, HTSUS, as “sauces.” Id. at 1343. Applying GRI 3(a), the rule of relative specificity, the court concluded that “HTSUS Heading 2103 for sauces is more specific than HTSUS Heading 2005 for prepared and preserved vegetables” and determined that the two products are properly classified under heading 2103, HTSUS, as “sauces.” Id. at 1343-1344.
Heading 2005, HTSUS, provides for “Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen, other than products of heading 2006.” The subject Mild Jalapeno Red Salsa meets the requirements of heading 2005, HTSUS, as described by the CIT in Mondiv. Specifically, the product is: (1) made from vegetables that are classified in Chapter 7, in particular, tomatoes, onions and jalapeno peppers; (2) ready for eating; (3) preserved by a means other than pickling in vinegar or acetic acid, in this case, it is preserved by means of sodium benzoate; (4) not frozen; and (4) not preserved with sugar. Therefore, the Mild Jalapeno Red Salsa is classifiable under heading 2005, HTSUS, as “Other vegetables prepared or preserved otherwise than by vinegar or acetic acid, not frozen, other than products of heading 2006.”
NY 856914 determined that the Mild Jalapeno Green Salsa is classifiable in heading 2008, HTSUS. Heading 2008, HTSUS, provides for “Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included.” Heading 2008, HTSUS, is a basket provision and therefore, the subject merchandise is classified in heading 2008, HTSUS, by application of GRI 1 only if it meets the terms of the heading and is not prima facie classifiable elsewhere. See R.T. Foods, Inc. v. United States, 757 F.3d 1349, 1354 (Fed. Cir. 2014) (stating that a provision that contains the terms “not elsewhere specified or included” is a basket provision, in which classification of a given product “is only appropriate if there is no tariff category that covers the merchandise more specifically”). The product does not fall within the scope of heading 2005, HTSUS, because it does not meet the first criteria identified by the Mondiv court for products of heading 2005, HTSUS. In particular, the Mild Jalapeno Green Salsa is not made of vegetables listed in Chapter 7, HTSUS, because it includes tomatillos, which are fruit that are classified in Chapter 8, HTSUS.
We must also consider whether the two subject products are classifiable as sauces under heading 2103, HTSUS. In accordance with the Mondiv decision, we consider whether they are “a mixture of ingredients in liquid or semisolid form that adds flavoring to food.” Id. at 1342. Like the artichoke antipasto and a green olive tapenade in the Mondiv decision, the two subject products are semisolid in form because they have a loose consistency, but they also have “discernible pieces” of ingredients. Id. at 1342-1343. Specifically, the Mild Jalapeno Red Salsa consists of small pieces of tomato, tomato seeds, onions and peppers and the Mild Jalapeno Green Salsa consists of tomatillo pieces and seeds, peppers and onions. Moreover, consistent with the EN to 21.03 and like the sauce products in the Mondiv decision, the two subject products contain ingredients that together provide “flavor, moisture, and a contrast in texture and [color]” to food. Accordingly, the two subject products are classifiable in heading 2103, HTSUS, as “sauces.” Pursuant to GRI 3(a), under the rule of relative specificity, the two products are classified under heading 2103, HTSUS, as sauces, rather than under headings 2005 or 2008, HTSUS.
The Mild Jalapeno Red Salsa, which is made with a base of tomatoes, is classified in subheading 2103.20.40, HTSUS, which provides for “Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Tomato ketchup and other tomato sauces: Other.” See Nestle Refrigerated Food Co., 18 C.I.T. at 669 (finding that “there are only two prerequisites to classification under the HTSUS provision for other tomato sauces; specifically, they are: (1) the product must be a sauce; and (2) tomatoes must be the primary ingredient of that sauce”). This subheading includes all sauces based on tomatoes, including salsas. See HQ 962417 (March 3, 1999) (a salsa “consisting of dried tomatoes, water, onions, tomato paste, green peppers, vinegar, carrots, starch, jalapeño peppers, salt, sugar, spices and sodium benzoate, appearing in a thick liquid as large quantities of chopped and sliced vegetables … sold at retail as a sauce,” was classified in subheading 2103.20.40, HTSUS, the provision for other tomato sauces). The Mild Jalapeno Green Salsa, which is made with a base of tomatillos, is classified in 2103.90.90, HTSUS, which provides for “Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Other: Other: Other.”
We also note that we are not revoking or modifying any rulings involving products that are “eaten, alone or with a bit of bread, either for its own sake only” or as an appetizer, consistent with the Bogle decision. See 152 U.S. 623.
HOLDING:
By application of GRI 1, 3(a) and 6, the Mild Jalapeno Red Salsa and the Mild Jalapeno Green Salsa are classified under heading 2103, HTSUS. The Mild Jalapeno Red Salsa is classified in subheading 2103.20.40, HTSUS, which provides for “Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Tomato ketchup and other tomato sauces: Other” and the Mild Jalapeno Green Salsa is classified in subheading 2103.90.90, HTSUS, which provides for “Sauces and preparations therefore; mixed condiments and mixed seasonings; mustard flour and meal and prepared mustard: Other: Other: Other.” The 2024 column one, general rate of duty is 11.6 percent ad valorem and 6.4 percent ad valorem, respectively.
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 https://hts.usitc.gov/.
EFFECT ON OTHER RULINGS:
HQ H259324, dated September 3, 2015, is REVOKED by operation of law.
HQ H258812, dated September 3, 2015, is REVOKED by operation of law.
NY N195658, dated January 4, 2012, is MODIFIED, only with respect to the Organic Nabali Olive Tapenade and the Sun-dried Tomato Caper Spread.
NY D88850, dated May 12, 1999, is MODIFIED, only with respect to the Sundried Tomato Marinara and the Roasted Eggplant Spread.
NY 890395, dated October 15, 1993, is MODIFIED, only with respect to the Salsa Base.
HQ 088976, dated January 6, 1992, is MODIFIED, only with respect to Law and Analysis section and the tariff classification of the Campagnola and Salsa Sorrentina.
NY 856914, dated October 24, 1990, is REVOKED.
HQ 085838, dated December 21, 1989, is 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,
Yuliya A. Gulis, Director
Commercial and Trade Facilitation Division