HQ 0086634 - Grated Parmesan Cheeses Blended in Canada - United States International Trade Commision Rulings

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HQ 086634
June 5, 1990
CLA-2 CO:R:C:G 086634 SLR

CATEGORY: CLASSIFICATION

TARIFF NO.: 0406.20.5020, 9904.10.45

Mr. Blair Laing
McCain Refrigerated Foods, Inc.
1075 North Service Road West
Oakville, Ontario
Canada L6M 2G2

RE: Grated Parmesan Cheeses Blended in Canada

Dear Mr. Laing:

This ruling is in response to your letter of February 2, 1990, requesting the proper classification of a blended Parmesan cheese product under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA).

FACTS:

The subject grated Parmesan product consists of Canadian, New Zealand, and Italian parmesans blended and packed in Canada. It is imported in 250 gram canisters intended for retail sale and carries the Presidents Choice label.

ISSUE:

What is the proper classification of the subject product under the HTSUSA?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is in accordance with the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification is determined according to the terms of the headings and any relevant section or chapter notes.

Heading 0406, HTSUSA, provides for cheese and curd. The Explanatory Notes, which represent the official interpretation of the tariff at the international level, offer guidance in understanding the headings. The Explanatory Note to Heading 0406 indicates that this heading covers all kinds of cheese including medium-hard cheese and hard cheese. Parmesan cheese is listed as one of the exemplars for this provision.

Because the subject product consists of three parmesan cheeses made from cow's milk, it is classifiable in subheading 0406.20.5020, HTSUSA. Products classifiable in this subheading are subject to the United States Department of Agriculture (USDA) licensing requirements and quota restrictions under subheading 9904.10.45, HTSUSA. Subheading 9904.10.45 provides quantitative limitations for "Italian-type cheeses, made from cow's milk, not in original loaves...and cheese substitutes for cheese containing, or processed from, such Italian-type cheeses, whether or not in original loaves." The blending of the three cheeses, one part from each of the named countries, does not substantially transform them into a new product in Canada that possesses Canadian origin for tariff and quota purposes. Instead, the end product is parmesan cheese, just as the raw materials before blending were also parmesan cheese.

Under current USDA licensing requirements, cheese of the variety that is proposed to be imported is not permitted entry into the United States. The Canadian cheese alone may be imported under a USDA license and would be subject to the "other" absolute quota quantity limit of 13,063 kilograms per year. The remaining cheeses, however, may not enter the United States from Canada because the USDA regulations require a Through Bill of Lading and an invoice from the seller in the country of origin to a purchaser in the United States. If there is an interruption in the flow of the goods, as in the situation outlined here, this is considered a "diversion" after which no license may be issued. For further information, please contact the Import Licensing Group, Foreign Agricultural Service, Room 6616-S, U.S. Department of Agriculture, Washington, D.C. 20250.

HOLDING:

The merchandise in issue is classifiable in subheading 0406.20.5020, HTSUSA, which provides for parmesan cheese made from cow's milk, dutiable at 15 percent ad valorem.

Sincerely,

John Durant, Director
Commercial Rulings Division

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