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NY K82124




January 27, 2004
CLA-2-04:RR:NC:2:231 K82124

CATEGORY: CLASSIFICATION

TARIFF NO.: 0406.10.7400; 0406.10.7800

Ms. Christina Benson, Esq.
Arent, Fox, Kintner, Plotkin, and Kahn, PLLC 1050 Connecticut Avenue, NW
Washington, DC 20036-5339

RE: The tariff classification of “Skyr.is” from Iceland.

Dear Ms. Benson:

In your letter, dated December 18, 2004, you requested a tariff classification ruling on behalf of your client, the Milk Marketing and Distribution Center Iceland (“Mjolkursamsalan” or “MS”), Reykjavik, Iceland.

The merchandise, “Skyr.is,” is produced from skim milk, which is cultured with three lactic cultures,--viz., Lactobacillus acidophilus, Bifidobacterium bifidus and Streptoccus thermophilus. After fermentation, the cultured milk is ultrafiltrated, resulting in the removal of most of the lactose, ash and water (i.e., whey components) in the product. After ultrafiltration, the retentate is cooled to 26º C (79º F), “and the remaining ingredients are then mixed in, including any fruit preparations or other flavorings such as those traditionally used in yogurt products.” The product is available in vanilla, strawberry, peach/raspberry, and blueberry flavors. It is packed in containers of 170 grams and 500 grams, net. The fat content of the 170 gram size was listed as 0.2 grams. The flavoring ingredients are as follows:

The Vanilla flavor is a preparation [comprised of water, modified food starch, pectins, sweeteners (aspartame and acesulfame-K), vanilla pods, acid regulators (sodium citrate and calcium citrate), coloring (beta-carotene), potassium sorbate (preservative)],. The Strawberry flavor is a fruit preparation (strawberries, sucrose, water, corn syrup, modified food starch, beet extract, pectins, sodium citrate, calcium citrate, and potassium sorbate). The Peach/raspberry flavor is also a fruit (peach/raspberry) preparation (sucrose, peaches, raspberries, water, modified food starch, pectins, vegetable juice extracts, citric acid, sodium citrate, calcium citrate, and potassium sorbate).

You state in your letter that you believe the “Skyr.is” products described above are classifiable under HTS subheading 0403.90, as fermented milk. In support of this contention, you note two rulings that classify what you consider to be similar products in heading 0403. Further, based on the absence of rennet or other coagulating enzymes from the manufacturing process, you feel that “Skyr.is” is not a cheese for tariff purposes. We disagree.

First, the term “milk,” for purposes of classification, means “full cream milk and partially or completely skimmed milk. [See note 1, chapter 4.] Heading 0403 provides for these forms of milk, when they’ve been fermented or acidified. In the production of “Skyr.is,” skimmed milk is first fermented by the action of added lactic acid-producing cultures. At the end of the culturing process, the product is a cultured, or fermented, milk described in heading 0403. However, at the end of the culturing process,--after a milk curd has been formed,--the milk is ultrafiltrated. This ultrafiltration step is not a simple concentration of the product, (such as might occur by the removal of water only), but is a manufacturing step that removes a part of the natural milk constituents and disturbs the ratio of the milk components. The resultant skim milk no longer has the composition of the natural product. It is not skim milk, but a mixture of fermented milk constituents. This fact distinguishes “Skyr.is” from the products covered by the rulings cited in your letter, which retained the composition of natural milk or milk and cream.

With regard to the classification of this product as cheese, the assertion that “Skyr.is” is not a cheese, (based on the fact that no rennet or other coagulating enzymes were used in its production), rests on the assumption that only rennet or enzymes are used to make cheese. While this is generally true, it is not necessarily true in the particular case. Lactic-acid producing bacteria, such as those used in making “Skyr.is,” are, in fact, milk coagulating agents.

The applicable subheading for fresh cheese, if entered under quota, will be 0406.10.7400, Harmonized Tariff Schedule of the United States (HTS), which provides for cheese and curd, fresh (unripened or uncured) cheese, including whey cheese, and curd, other, other, other, cheese and substitutes for cheese, containing 0.5 percent or less by weight of butterfat, described in additional U.S. note 23 to this chapter and entered pursuant to its provisions. The rate of duty will be 10 percent ad valorem.

The applicable subheading for fresh cheese, if entered outside the quota, will be 0406.10.7800, HTS, which provides for cheese and curd, fresh (unripened or uncured) cheese, including whey cheese, and curd, other, other, other, other cheese and substitutes for cheese, containing 0.5 percent or less by weight of butterfat, other. The rate of duty will be $1.128 per kilogram. In addition, products classified in subheading 0406.10.7800, HTS, will be subject to additional safeguard duties, as described in subheadings 9904.06.29 – 9904.06.37.

For goods classified in subheading 0406.10.7400, an import license, issued to the importer by the United States Department of Agriculture, will be required at the time that such merchandise is entered for consumption into the United States.

Questions regarding licensing procedures and applications for licenses to import cheese subject to quota should be addressed to:

Import Quota Manager for Dairy Products
STOP 1029/Room 5531-S
U.S. Department of Agriculture
1400 Independence Avenue, S.W.
Washington, DC 20250-1029

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 CFR 177).

A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Thomas Brady at (646) 733-3030.

Sincerely,

Robert B. Swierupski
Director

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