United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1991 HQ Rulings > HQ 0088548 - HQ 0088639 > HQ 0088622

Previous Ruling Next Ruling



HQ 088622


May 24, 1991

CLA-2 CO:R:C:F 088622 RFC

CATEGORY: CLASSIFICATION

TARIFF NO.: 2106.90.6097

Ms. Sandra Liss Friedman
Barnes, Richardson & Colburn
475 Park Avenue South
New York, NY 10016

RE: Liquid nutritional food product

Dear Ms. Friedman:

This ruling letter is in response to your request of January 23, 1991, to the Area Director of Customs, New York Seaport, on behalf of Bristol-Myers Squibb Company, concerning the tariff classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) of a liquid nutritional food product identified as "Sustacal."

FACTS:

The product is described as a nutritionally complete, ready to use liquid food. It is stated to be formulated to meet the supplemental or total nutritional needs of patients who, for a variety of reasons, have difficulty in meeting their nutritional requirements through a normal diet. The product may be ingested or administered orally or by a feeding tube. It is lactose free and contains fiber, numerous nutriments, vitamins and minerals.

ISSUE:

What is the proper classification under the HTSUSA of a liquid nutritional food product that may be ingested or administered orally or by a feeding tube?

LAW AND ANALYSIS:

Merchandise imported into the United States is classified under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA). The tariff classification of merchandise under the HTSUSA is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUSA and are to be considered statutory provisions of law for all purposes. See Sections 1204(a) and 1204(c) of the Omnibus Trade and Competitiveness Act of 1988 (19 U.S.C. 1204(a) and 1204(c)).

GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule (i.e., (1) merchandise is to be classified under the 4-digit heading that most specifically describes the merchandise; (2) only 4-digit headings are comparable; and (3) merchandise must first satisfy the provisions of a 4-digit heading before consideration is given to classification under a subheading within this 4-digit heading) and any relative section or chapter notes and, provided such headings or notes do not otherwise require, then according to the other GRIs.

GRI 1 prescribes that, for legal purposes, GRIs 1 to 5 shall govern, mutatis mutandis, classification at subheading levels within the same heading. Therefore, merchandise is to be classified at equal subheading levels (i.e., at the same digit level) within the same 4-digit heading under the subheading that most specifically describes or identifies the merchandise.

The Explanatory Notes to the Harmonized Commodity Description and Coding System (hereinafter "Harmonized System") represent the official interpretation of the Customs Cooperation Council on the scope of each heading. See H.R. Conf. Rep. No. 100-576, 100th Cong., 2d Sess. 549 (1988); 23 Customs Bulletin No. 36, 3 (T.D. 89-90, September 6, 1989), 59 F.R. 35127 (August 23, 1989). Although not binding on the contracting parties to the Harmonized System Convention or considered to be dispositive in the interpretation of the Harmonized System, the Explanatory Notes should be consulted on the proper scope of the Harmonized System. Id.

A review of the chapters in the schedule reveals that the instant product may be potentially classified in three chapters: chapter 30, chapter 22, and chapter 21. Chapter 30 covers pharmaceutical products. Of special significance to the instant classification analysis is note 1(a) to chapter 30:

[C]hapter [30] does not cover...[f]oods or beverages (such as dietetic, diabetic or fortified foods, food supplements, tonic beverages and mineral waters) (section IV)....

Chapter notes are part of the legal text of the HTSUSA and are to be considered statutory provisions of law for all purposes. See Sections 1204(a) and 1204(c) of the Omnibus Trade and Competitiveness Act of 1988 (19 U.S.C. 1204(a) and 1204(c)). Moreover, as indicated above, chapter notes, together with the terms of the headings and sections notes, are the principal authority by which merchandise is to be classified under the schedule. See GRI 1. Therefore, chapter notes are to be considered mandatory authority for the classification of merchandise under the schedule. Accordingly, merchandise meeting a description set forth in chapter note 1(a) to chapter 30 is clearly excluded from classification in that chapter.

In the instant case, the broad language of note 1(a) to chapter 30 most assuredly covers the instant product. As discussed above, this product is simply a liquid nutritional food product. It is, then, a food (e.g., "dietetic food" or "fortified food" or "food supplement"). The instant product, therefore, is clearly covered by the language of note 1(a) to chapter 30; thus, it is not classified in chapter 30.

Even if one were to disregard, for purposes of argumentation or otherwise, note 1(a) to chapter 30, the instant product would still not be properly classified in chapter 30. As the product is marketed as a nutrient and is sold in forms or packings for retail sale, the only heading in chapter 30 where it could be possibly be classified is 3004. This heading provides for "medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses or in forms or packings for retail sale." Guidance concerning merchandise not classified under heading 3004 can be found in the Explanatory Notes to this heading. These notes, which as indicated above, are merely to be used as persuasive authority in the interpretation of the Harmonized System, state the following:

The provisions of...[heading 3004]...do not apply to foodstuffs or beverages such as dietetic, diabetic or fortified foods, tonic beverages or mineral waters (natural or artificial), which fall [sic] to be classified under their own appropriate headings. This is essentially the case as regards food preparations containing only nutritional substances. The major nutritional substances in food are proteins, carbohydrates and fats. Vitamins and mineral salts also play a part in nutrition.

Similarly foodstuffs and beverages containing medicinal substances are excluded from the heading if those substances are added solely to ensure a better dietetic balance, to increase the energy-giving or nutritional value of the product or to improve its flavour, always provided that the product retains its character of a foodstuff or a beverage.

Moreover, products consisting of a mixture of plants or parts of plants or consisting of plants or parts of plants mixed with other substances, used for making herbal infusions or herbal "teas" and claimed to offer relief from ailments or contribute to general health and well-being but whose infusions do not constitute a therapeutic or prophylactic dose of an active ingredient specific to a particular ailment, are also excluded from this heading (heading 21.06).

Further this heading excludes food supplements containing vitamins or minerals salts which are put up for the purpose of maintaining health or well-being but have no indication as to use for the prevention or treatment of any disease or ailment. These products which are usually in liquid form but may also be put up in powder or tablet form, are generally classified in heading 21.06 or Chapter 22.

On the other hand, the heading covers preparations in which the foodstuff or the beverage merely serves as a support, vehicle or sweetening agent for the medicinal substances (e.g., in order to facilitate ingestion).

See Explanatory Notes to Heading 3004 to the Harmonized Commodity Description and Coding System.

Under the above-listed first paragraph, the instant product is excluded from classification under heading 3004 because the product is merely a food preparation containing nutritional substances, vitamins, and minerals. Moreover, under the above- listed fourth and fifth paragraphs, which must be read in conjunction with each other, the product is also excluded from classification under heading 3004 because there is "no indication as to use for the prevention or treatment of any disease or ailment" (e.g., the product contains no "medicinal substances" for which the foodstuff or beverage merely serves as a support, vehicle or sweetening agent).

The second chapter in which the instant product may be potentially classified is chapter 22. This chapter provides for beverages, spirits and vinegar. Guidance concerning the coverage of chapter 22 can be found in the general notes to the Explanatory Notes to this chapter:

The products of this Chapter constitute a group quite distinct from the foodstuffs covered by the preceding Chapters of the Nomenclature[, and]...[the products] fall into four main groups: (A) [w]ater and other non-alcoholic beverages and ice[;] (B) [f]ermented alcoholic beverages (beer, wine, cider, etc,)[;] (C) [d]istilled alcoholic liquids and beverages (liqueurs, spirits, etc.), compound alcoholic preparations therefor and ethyl alcohol[; and] (D) [v]inegar and substitutes for vinegar.

See General Notes to the Explanatory Notes to Chapter 22 to the Harmonized Commodity Description and Coding System.

In view of these notes, then, it is clear that the scope of this chapter is something less than all consumable liquids.

The only heading in chapter 22 that merits consideration in the instant classification analysis is heading 2202. This heading provides for "waters, including mineral waters and aerated waters, containing added sugar or other sweetening matter or flavored, and other nonalcoholic beverages, not including fruit or vegetable juices of heading 2009." As the instant product is not merely a water, including mineral water or aerated water containing added sugar or other sweetening matter or flavored, then pursuant to GRI 1, the product must fit the description of an "other nonalcoholic beverage" or be classified elsewhere in the schedule.

The terminology "nonalcoholic beverages" is not specifically defined in the schedule. Guidance concerning what constitutes a "nonalcoholic beverage" for purposes of classification under heading 2202, however, can be found in the Explanatory Notes to this heading:

This heading covers non-alcoholic beverages...not classified under other headings, particularly heading 20.09 or 22.01. It includes, inter alia:

(1) Sweetened or flavoured mineral waters (natural or artificial).

(2) Beverages such as lemonade, orangeade, cola, consisting of ordinary drinking water, sweetened or not, flavoured with fruit juices or essences, or compound extracts, to which citric or tartaric acid are sometimes added. They are often aerated with carbon dioxide gas, and are generally presented in bottles or other airtight containers.

(3) Tamarind nectar rendered ready for consumption as a beverage by the addition of water and sugar and straining.

(4) Certain other beverages ready for consumption, such as those with a basis of milk and cocoa.

See Explanatory Notes to Heading 2202 to the Harmonized Commodity Description and Coding System.

The term "beverage" has a broad meaning in general English- language usage. See Webster's Ninth New Collegiate Dictionary 146 (1989) (a beverage is "a drinkable liquid"); Webster's Third New International Dictionary 210 (1986) (a beverage is a "liquid for drinking; esp: such liquid other than water (as tea, milk, fruit juice, beer) usu. prepared (as by flavoring, heating, admixing) before being consumed"); Webster's II New Riverside University Dictionary 169 (1984) (a beverage is "[a] liquid for drinking, usu. excluding water"); The Random House Dictionary of the English Language 143 (1983) (a beverage is "a drink of any kind other than water, as tea, coffee, beer, milk, etc."). It is clear, however, that from a review of the HTSUSA and the Explanatory Notes thereto the terminology "nonalcoholic beverages" for purposes of classification of merchandise under heading 2202 is limited and not intended to include all drinkable liquids not having a certain alcoholic content. First, certain other drinkable liquids that could qualify as "nonalcoholic beverages" in general English-language usage are specifically provided for in the terms of other headings: plain and unadulterated water in heading 2201 and fruit juices and vegetable juices in heading 2009. Second, the article description for heading 2202 has non-exhaustive language (i.e., "waters...containing added..., and other nonalcoholic beverages, not including..." rather than language such as "and all other beverages"). Third, the Explanatory Notes to heading 2202, as indicated above, implicitly recognize a limitation as to the types of "nonalcoholic beverages" that are to be classified under heading 2202 (i.e., "[c]ertain other beverages ready for consumption..."). Fourth, and of special significance to the instant classification analysis, the Explanatory Notes to headings 3003 and 3004 both explicitly state that there are certain drinkable liquids--which may or may not contain alcohol-- that may be classified in other than chapter 22 (i.e., "food supplements...in liquid form...are generally classified in heading 21.06 or Chapter 22").

In light of the above, particularly as concerns the article description for heading 2202 and the Explanatory Notes to this heading and the Explanatory Notes discussed above in regard to headings 3003 and 3004, it is apparent that heading 2202 does not contemplate and encompass as "other nonalcoholic beverages" products like the importer's, above-described product. Liquid nutritional food products intended to supplement or to completely sustain one's dietary or nutritional needs are not properly classified under heading 2202.

The final chapter in which the instant product may be potentially classified is chapter 21. This chapter covers miscellaneous edible preparations. As the instant product is a food preparation and has not been found to be specified or included elsewhere in the schedule, a heading in chapter 21 providing for such a product would need to be given consideration as a potential heading for classification of the product. The only heading in chapter 21 that merits consideration in the instant classification analysis appears to provide for the instant product. This is heading 2106. It provides for "food preparations not elsewhere specified or included." Guidance concerning the coverage of heading 2106 can be found in the Explanatory Notes to this heading:

Preparations, often referred to as food supplements, based extracts from plants, fruit concentrates, honey, fructose, etc. and containing added vitamins and sometimes minute quantities of iron compounds. These preparations are often put up in packagings with indications that they maintain general health or well-being. Similar preparations, however, intended for the preventation or treatment of diseases or ailments are excluded (Heading 30.03 or 30.04).

See Explanatory Note (16) to Heading 2106 to the Harmonized Commodity Description and Coding System.

In fact, this note is consistent with the previously discussed notes found in the Explanatory Notes to headings 3003 and 3004, wherein heading 2106 is specifically identified as a potential heading for the classification of vitamin- or mineral-salt- fortified, liquid foods. In the instant case, the product clearly fits the above description. In view thereof, one can only conclude that the instant product is properly classified under heading 2106.

It should be noted that in Headquarters Ruling Letters 082193, dated February 2, 1989, and 083895, dated June 21, 1989, products substantially similar to the instant product (i.e., liquid nutritional food products capable of being ingested or administered orally or by a feeding tube) were found to be properly classified under heading 2106.

HOLDING:

The above-described product is properly classified under the statistical-reporting number 2106.90.6097, HTSUSA, which provides for food preparations not elsewhere specified or included, other, other, other, other, other, other, other, other, containing sugar derived from sugar cane and/or sugar beets.

The general rate of duty for goods imported under subheading 2106.90.60 is 10 percent ad valorem. The special rate of duty under the United States-Canada Free-Trade Agreement for qualifying goods imported under this same subheading is 7 percent ad valorem.

Sincerely,

John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling