October 23, 2008 CBP Bulletin Notice on Classification of Milk Chocolate Chips
In the October 23, 2008 issue of the U.S. Customs and Border Protection Bulletin (CBP Bulletin) (Vol. 42, No. 44), CBP published a notice revoking a classification ruling and a treatment as follows:
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Revocation of ruling, revocation of treatment.CBP is revoking a ruling on the classification of milk chocolate chips. In addition, this notice covers any rulings on this merchandise which may exist but have not been specifically identified. CBP is also revoking any treatment it has previously accorded to substantially identical transactions.
According to CBP, these actions are effective for merchandise entered or withdrawn from warehouse for consumption on or after December 22, 2008.
Milk chocolate chips. The product is described as a milk chocolate chip product intended for use as "decoration on cakes/pastries, in home baking and ready-to-eat." The product was to be shipped in two forms: (i) packaged for retail sale in 300-gram retail bags and (ii) packaged in 25-pound cases to be repackaged after importation.
The chocolate chips were further described as being composed of 47.21 percent sugar, 22 percent cocoa paste, 12.59 percent (non-fat) milk powder, 11.07 percent cocoa butter, 0.008 percent vanillin, and 7.10 percent milk fat. The total milk solids content of the chocolate was 19.69 percent, and the total milk fat content of the chocolate was 7.14 percent.
CBP is issuing HQ H009857 in order to revoke NY N007481 and reclassify the milk chocolate chips in 25-pound cases under HTS 1806.20.2600 as "Chocolate and other food preparations containing cocoa: Other preparations in blocks, slabs or bars, weighing more than 2 kg or in liquid, paste, powder, granular or other bulk form in containers or immediate packings, of a content exceeding 2 kg: Other: Containing butterfat or other milk solids: Other, containing over 5.5 percent by weight of butterfat: Other: Containing less than 21 percent by weight of milk solids" rather than under HTS 1806.20.3600, as "Chocolate and other food preparations containing cocoa: Other preparations in blocks, slabs or bars, weighing more than 2 kg or in liquid, paste, powder, granular or other bulk form in containers or immediate packings, of a content exceeding 2 kg: Other: Containing butterfat or other milk solids: Other: Other: "Containing less than 21 percent by weight of milk solids."
Regarding the 25-pound case chocolate chips, as a result of comments received, CBP abandoned its view that the expression "bulk form" in subheading 1806.20 refers to food preparations that will undergo material change into a finished article after importation. Subheading 1806.20 provides for food preparations containing cocoa in "bulk form . . . of a content exceeding 2 kg." CBP now states that chocolate chips are a bulk form similar to the exemplars listed therein and fall under the provisions of 1806.20. Further, the chocolate chips shipped in 25-pound cases, meet the minimum weight requirements of subheading 1806.20. Therefore, the chocolate chips shipped in 25-pound cases are properly classified in 1806.20.2600. (CBP had initially proposed classifying the 25-pound case under 1806.90.1800.)
For the milk chocolate chips shipped in 300-gram retail bags, CBP has determined classification in HTS 1806.90.1500 as "Chocolate and other food preparations containing cocoa: Other: Other: Other: Containing butterfat or other milk solids: Other, containing over 5.5 percent by weight of butterfat: Described in additional U.S. note 2 to chapter 18 and entered pursuant to its provisions", or if limits are exceeded, 1806.90.1800 as "Chocolate and other food preparations containing cocoa: Other: Other: Other: Containing butterfat or other milk solids: Containing over 5.5 percent by weight of butterfat: Other: Containing less than 21 percent by weight of milk solids" rather than under HTS 1806.90.2800 as: "Chocolate and other food preparations containing cocoa: Other: Other: Other: Containing butterfat or other milk solids: Other: Other: Containing less than 21 percent by weight of milk solids."
New: in 25-pound bags: 1806.20.2600, 37.2c/kg 4.3%, subject to quota under Chapter 99, and for chocolate chips in 300 gram bags: 1806.90.1500, 3.5%, or if limits are exceeded, 1806.90.1800, 37.2c/kg 6%, subject to quota under Chapter 99
Previous: in 25-pound bags: 1806.20.3600, 37.2c/kg 4.3%, subject to quota under Chapter 99; and for chocolate chips in 300-gram bags: 1806.90.2800, 37.2c/kg 6%, subject to quota under Chapter 99.
(See ITT's Online Archives or 08/22/08 news, 08082250, for BP summary of proposed HQ H009857.)
October 23, 2008 CBP Bulletin (Vol. 42, No. 44) available at http://www.cbp.gov/xp/cgov/trade/legal/bulletins_decisions/bulletins_2008/