[Federal Register Volume 86, Number 152 (Wednesday, August 11, 2021)]
[Notices]
[Pages 44030-44031]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-17142]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
[Docket No. USCBP-2021-0028]
Receipt of Domestic Interested Party Petition Concerning the
Tariff Classification of Dried Onion Products
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security.
ACTION: Notice of receipt of domestic interested party petition;
solicitation of comments.
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SUMMARY: U.S. Customs and Border Protection (CBP) has received a
petition submitted on behalf of a domestic interested party requesting
the reclassification, under the Harmonized Tariff Schedule of the
United States (HTSUS), of certain dried onion products. CBP currently
classifies the subject dried onion products under subheading
2005.99.20, HTSUS, as onions prepared or preserved otherwise than by
vinegar or acetic acid. Petitioner contends that the proper
classification for the subject dried onion products is under subheading
0712.20.20, HTSUS, as dried onion powder not further prepared. This
document invites comments with regard to the correctness of the current
classification.
DATES: Comments must be received on or before October 12, 2021.
ADDRESSES: You may submit comments, identified by docket number, by the
first method listed below:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments via docket number
USCBP-2021-0028.
Mail: Due to COVID-19-related restrictions, CBP has
temporarily suspended its ability to receive public comments by mail.
Instructions: All submissions received must include the agency name
and docket number for this notice of domestic interested party petition
concerning the tariff classification of dried onion products. All
comments received will be posted without change to http://www.regulations.gov, including any personal information provided.
Docket: For access to the docket to read background documents,
exhibits, or comments received, go to http://www.regulations.gov. Due
to the relevant COVID-19-related restrictions, CBP has temporarily
suspended on-site public inspection of public comments.
FOR FURTHER INFORMATION CONTACT: Tanya Secor, Food, Textiles and
Marking Branch, Regulations and Rulings, Office of Trade, U.S. Customs
and Border Protection, at (202) 325-0062 or by email at
[email protected].
SUPPLEMENTARY INFORMATION:
Background
A petition has been filed under section 516 of the Tariff Act of
1930, as amended (19 U.S.C. 1516), on behalf of Olam West Coast Inc.
(Petitioner or Olam), which is an agri-business and supplier of food,
ingredients, and raw materials, based in Fresno, California. Olam
manages a wide range of production, processing, and supply of
agricultural products in twelve states, with a majority of its
operations in California. Olam's largest onion and garlic plant is in
Gilroy, California. Olam meets all of the requirements of a domestic
interested party set forth in 19 U.S.C. 1516(a)(2) and section 175.3(a)
in title 19 of the Code of Federal Regulations (19 CFR 175.3(a)).
In New York Ruling Letter (NY) N265994 (July 9, 2015), NY N261449
(February 20, 2015), NY N257752 (October 24, 2014), and NY M86441
(October 13, 2006), CBP classified various mixtures of onion powder and
salt or other ingredients as prepared or preserved onions in subheading
2005.99.20 of the Harmonized Tariff Schedule of the United States
(HTSUS), which provides for ``Other vegetables prepared or preserved
otherwise than by vinegar or acetic acid, not frozen, other than
products of heading 2006: Other vegetables and mixtures of vegetables:
Other: Onions.'' Petitioner contends that the proper classification for
the onion powder mixtures is dried onion powder in subheading
0712.20.20, HTSUS, which provides for ``Dried vegetables, whole, cut,
sliced, broken or in powder, but not further prepared: Onions: Powder
or flour.''
Applicable Legal Principles
Classification under the HTSUS is determined in accordance with 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 (ARIs). GRI 1 provides that the classification
of goods shall be determined according to the terms of the headings and
any relative section or chapter notes. In the event that the goods
cannot be classified solely on the basis of GRI 1, and if the headings
and legal notes do not otherwise require, GRIs 2 through 6 may be
applied in order. GRI 3(b) applies to mixtures, which are prima facie,
classifiable under two or more headings and which cannot be classified
by reference to GRI 3(a). Pursuant to GRI 3(b), mixtures shall be
classified as if they consisted of the material or component which
gives them their essential character.
Note 3 to Chapter 7, HTSUS, provides that heading 0712 covers all
dried vegetables of the kinds falling in headings 0701 to 0711,
excluding certain vegetables but including onions. Note 1(a) to Chapter
20, HTSUS, provides that this chapter does not cover vegetables, fruit
or nuts, prepared or preserved by the processes specified in Chapter 7,
8, or 11. Conversely, Note 3 to Chapter 20, HTSUS, provides in
pertinent part that heading 2005 covers, as the case may be, only those
products of Chapter 7, which have been prepared or preserved by
processes other than those referred to in Note 1(a).
The Explanatory Notes (ENs) to the Harmonized Commodity Description
and Coding System represent the official interpretation of the tariff
at the international level. While neither legally binding nor
dispositive, the ENs provide a commentary on the scope of each heading
of the HTSUS and are generally indicative of the proper interpretation
of
[[Page 44031]]
these headings. See Treasury Decision (T.D.) 89-80, 54 FR 35127, 35128
(August 23, 1989).
The General EN to Chapter 7, HTSUS, provides, in pertinent part,
that this Chapter covers vegetables, including the products listed in
Note 2 to the Chapter, whether fresh, chilled, frozen (uncooked or
cooked by steaming or boiling in water), provisionally preserved or
dried (including dehydrated, evaporated or freeze-dried), and that some
of these products when dried and powdered are sometimes used as
flavoring materials but nevertheless remain classified in heading
07.12. The EN further states that vegetables prepared or preserved by
any process not provided for in Chapter 7 fall in Chapter 20. The EN
for heading 07.12 states, in pertinent part, that the heading covers
vegetables of headings 07.01 to 07.11 which have been dried (including
dehydrated, evaporated or freeze-dried) i.e., with their natural water
content removed by various processes. The EN further provides that
heading 0712, HTSUS, covers dried vegetables, broken or powdered, such
as asparagus, cauliflower, parsley, chervil, onion, garlic, celery,
generally used either as flavouring materials or in the preparation of
soups. The EN for heading 20.05 states, in pertinent part, that the
heading covers products (other than vegetables prepared or preserved by
vinegar or acetic acid of heading 20.01, frozen vegetables of heading
20.04 and vegetables preserved by sugar of heading 20.06) that have
been prepared or preserved by processes not provided for in Chapter 7
or 11.
Elaboration of the Petitioner's Views
Petitioner contends that the proper classification for the subject
dried onion products is subheading 0712.20.20, HTSUS, which provides
for ``Dried vegetables, whole, cut, sliced, broken or in powder, but
not further prepared: Onions: Powder or flour.'' Petitioner contends
that the subject onion products are (1) preserved by drying and,
therefore, excluded from Chapter 20, HTSUS; (2) neither ``preserved''
nor ``prepared'' in a manner covered by Chapter 20, HTSUS; and (3) not
``prepared'' or ``preserved'' under the ``common and commercial
meaning'' of those terms. Specifically, Petitioner argues that the
subject dried onion products are neither prepared nor preserved because
the small quantities of salt or preservatives do not create a permanent
change to the onion powder. In support of its argument, Petitioner
relies on Headquarters Ruling Letter (HQ) H243645 (September 30, 2015)
wherein CBP classified dried sliced and diced potatoes with added
sodium bisulfate under subheading 0712.90.30, HTSUS, as dried potatoes
not further prepared. In HQ H243645, CBP determined that sodium
bisulfite simply preserved the potatoes' freshness, color and flavor,
and did not further prepare the product.
Petitioner asserts that to the extent the products are mixtures of
multiple ingredients, the essential character of these products remains
onion powder and therefore they should be classified under 0712.20.20,
HTSUS, pursuant to GRI 3(b). Petitioner also argues that classifying
such products as ``prepared'' or ``preserved'' is contrary to the
intention to protect domestic production of dried onion as indicated by
the high tariff rate applicable to dried onion and dried onion powder.
Analysis Used by CBP in Prior Rulings
Subheading 2005.99.20, HTSUS, provides for ``Other vegetables
prepared or preserved otherwise than by vinegar or acetic acid, not
frozen, other than products of heading 2006: Other vegetables and
mixtures of vegetables: Other: Onions.'' The EN for heading 07.12
provides guidance that the heading covers dried vegetables in powder
form, including onion, not otherwise prepared. If a dried vegetable
product is prepared beyond the scope of heading 0712, HTSUS, it will be
precluded from classification in that heading and classifiable in
heading 2005, HTSUS.
In the rulings at issue, the dried onion products are comprised of
dried onion powder and varying additional ingredients. Specifically, NY
N265994 classified agglomerated onion powder consisting of 94.5% dried
onion powder, 5% water, and 0.5% of maltodextrin, silicon dioxide, and
potassium sorbate combined. NY N261449 classified onion and salt
powders blended in five different formulations: 91% onion powder and 9%
salt; 93% onion powder and 7% salt; 95% onion powder and 5% salt; 97%
onion powder and 3% salt; and 99% onion powder and 1% salt. NY N257752
classified five products, two of which were comprised of onion powder
and salt. The first consisted of 80% onion powder and 20% salt and the
second consisted of 90% onion powder and 10% salt. Finally, NY M86441
classified agglomerated onion powder consisting of 88.5% dehydrated
onion powder, 5% water, 4% corn starch, 1% Arabic gum, 1% silicon
dioxide, and 0.5% citric acid. CBP determined that the addition of salt
and other ingredients, regardless of the proportions, further prepared
the onion powder beyond the scope of heading 0712, HTSUS. Thus, these
dried onion products were classified pursuant to GRI 1 in subheading
2005.99.20, HTSUS, as onions prepared or preserved otherwise than by
vinegar or acetic acid.
Comments
Pursuant to section 175.21, CBP Regulations (19 CFR 175.21), before
making a determination on this matter, CBP invites written comments on
the petition from interested parties.
The domestic interested party petition concerning the tariff
classification of certain dried onion products, as well as all comments
received in response to this notice, will be available for public
inspection on the docket at www.regulations.gov.
Authority
This notice is published in accordance with 19 U.S.C. 1516 and
section 175.21 of the CBP Regulations (19 CFR 175.21).
Troy A. Miller, the Acting Commissioner, having reviewed and
approved this document, is delegating the authority to electronically
sign this document to Robert F. Altneu, who is the Director of the
Regulations and Disclosure Law Division for CBP, for purposes of
publication in the Federal Register.
Dated: August 6, 2021.
Robert F. Altneu,
Director, Regulations & Disclosure Law Division, Regulations & Rulings,
Office of Trade, U.S. Customs and Border Protection.
[FR Doc. 2021-17142 Filed 8-10-21; 8:45 am]
BILLING CODE 9111-14-P