HQ 0081515 - Classification of battered cheese products under the Harmonized Tariff Schedule (HTS) - United States International Trade Commision Rulings

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HQ 081515

March 22, 1989

CLA-2 CO:R:C:G 081515 JGH

CATEGORY: CLASSIFICATION

TARIFF NO.: HTSUS 2106.90.40

David O. Elliott, Esq.
Barnes, Richardson & Colburn
475 Park Avenue South
New York, New York 10016

RE: Classification of battered cheese products under the Harmonized Tariff Schedule (HTS)

Dear Mr. Elliott:

This is in reference to your submissions on the classification of battered cheese products from Canada.

FACTS:

The products are battered cheddar cheese balls or cubes and battered mozzarella cheese sticks. The cheese balls are said to be about one inch in diameter, 55.6 percent by weight of batter and 44.4 percent by weight cheddar cheese. The mozzarella sticks are said to be about 3 inches in length and 3/4 inch in diameter and to consist of 54.5 percent by weight of batter and 45.5 percent by weight mozzarella cheese. A Customs laboratory examination of samples of the products described the cheese balls as consisting of 59 percent coating by weight and 41 percent cheese, and the sticks to consist of 52.5 percent cheese and 47.5 percent coating. It is asserted that the manufacturer is employing quality control measures to insure that the batter content is more than 50 percent by weight. The coating is said to consist of wheat flour, toasted wheat crumbs, soya flour, corn flour, grated romano cheese, seasonings, and preservatives. The products are said to be wrapped in a "tempura-lite" batter and then oil blanched and frozen. They are prepared by pan frying, deep frying or oven baking. They will be imported in non-retail size packages for sale to the institutional trade.

ISSUE:

Whether the mozzarella sticks are classifiable as other cheese containing cow's milk in subheading 0406.90.8060, HTS, and the coated cheddar cheese balls as other cheddar cheese in subheading 0406.90.1040, HTS, or whether the products are classifiable as other food preparations, not elsewhere specified or included: Containing over 5.5 percent by weight of butterfat and not packaged for retail sale, in subheading 2106.90.40, HTS.

LAW AND ANALYSIS:

In support of classification of the battered cheese products under the cheese provisions, it is argued that the products, even though coated, are essentially cheese; that the material which gives the product its dominant flavor is cheese. Following (General Rules of Interpretation) GRI 2(b), it is claimed the basic character, cheese, has not been changed by the addition of batter. Under GRI 3(b), it is asserted, the essential nature of the product may be determined by the nature of the principal material or component, its quantity, bulk, weight or value, and the role of the constituent material in relation to the use of the goods. Heading 2106 HTS, would only be considered in the event a more specific provision is not available. Heading 0406.90, HTS, for cheese, it is felt, is more specific and would apply to a cheese product such as this whether or not combined with other ingredients.

It is your position that since the products are cheese wrapped in "tempura-lite" seasoned batter, which is then oil blanched and frozen, the result is an appetizer, hors d'oeuvres or snack, which is cooked before consuming, that such a processing creates a new product which is most specifically described, following GRI 3(a), in subheading 2106.90.40, HTS, as a food preparation containing over 5.5 percent by weight butterfat. In the explanatory notes to 2106, you note, there are examples of food preparations which include significant amounts of dairy products, such as preparations based on butter or other fats, or foodstuffs of flour sugar, milk powder, etc. Another example cited is from the "Explanatory Notes to the Combined Nomenclature of the European Community", in which cheese fondues are mentioned. They are described as a core of cheese surrounded by bread crumbs and were considered as food preparations. Therefore, subheading 2106.90.40 is said to be the most specific provision for these battered cheese products.

The products are essentially bite-size snack foods and therefore can be readily distinguished from the larger cheese products such as cheese balls which are seasoned. In fact, the explanatory notes to heading 0406 mentions that the presence of meat, spices, vegetables, fruit, nuts, vitamins, skimmed milk powder etc., does not affect classification provided that the goods retain the character of cheese. From the small size of the products and the amount of coating each product has, it is not believed that they contain commercially extractable butterfat.

Customs has previously considered the classification of a cheese product similar to these. In ruling 014958 of May 17, 1972, the issue was the classification of "cheese footballs," described as small spherical cheese-filled biscuits/cookies. The products were classified as edible preparations in item 182.95, TSUS. They were not subject to quota restraints, since the butterfat content was not felt to be commercially extractable and as finished articles they were not considered suitable for use as ingredients in the commercial production of other edible articles.

Another factor considered by Customs in the classification of products such as this, is the thickness of the coating. In Hilo Rice Mill Co., Ltd., American Customs Brokerage Company v. United States, C.A.D. 866, the classification of coated peanuts was considered. The court noted the coating appeared to be the thickness of the diameter of the peanut. The product was classifiable as a baked good, rather than as peanuts. In contrast, in another case, peanuts with thin, brittle coatings were still considered as peanuts for classification purposes.

In arguing that the products are cheese, it is apparently believed that a distinction may be drawn between such earlier decisions and the current issues brought under the HTS, because of new concepts such as"essential character." Under the GRIs the first two rules concern the classification of merchandise according to the applicable HTS headings. It is therefore contended that the provisions for cheese provide for a product such as this. However, these battered cheese products are something more than a seasoned cheese. In view of the method in which the battered cheese products are produced, they are not merely mixtures but are more accurately described as "preparations for use, either directly or after processing (such as by cooking, dissolving, boiling in water, milk, etc.) for human consumption", as described in the explanatory notes for 2106, HTS.

HOLDING:

Battered cheese products, bite-size snack foods, which are processed food products consisting of a small amount of cheese covered with a batter which is thicker by weight than the cheese component and which do not contain any extractable butterfat and are not suitable for use as ingredients in the commercial production of edible articles, are classifiable under the provision for other food preparations not elsewhere specified or included: containing over 5.5 percent by weight of butterfat and not packaged for retail sale, in subheading 2106.90.40, HTS. The rate of duty is 16 percent ad valorem.

Sincerely,

John Durant, Director

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