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NY L82122

February 9, 2005



TARIFF NO.: 2008.19.4000

Mr. Dominic Teh
Sun Bay International
5250 W. Century Blvd., Suite 608
Los Angeles, CA 90045

RE: The tariff classification of “Almond Crunch” from China

Dear Mr. Teh:

In your letter dated December 24, 2004, you requested a tariff classification ruling on behalf of your client, May Food Manufacturing, dba Mrs. May’s Naturals.

The product in question, designated “Almond Crunch,” consists of shelled almonds of U.S. origin, which will be exported to China. In China, the almonds will be roasted, cut into pieces and then coated with a mixture of rice malt, organic evaporated sugar cane juice and sea salt. The coated almonds are formed into clusters and, finally, packaged for sale prior to being exported to the United States. A sample, submitted with your request, consisted of a retail bag of 20 ounces, net, labeled as Mrs. May’s all natural “Almond Crunch.”

In your letter, you state that, although the almonds have been advanced and improved in China, “the essential character of the shelled almonds remains intact.” You ask whether the returning processed almonds would qualify for preferential treatment in subchapter II, Chapter 98, HTSUS. Specifically, it appears that you are asking whether these goods qualify for treatment in subheading 9802.00.50, HTSUS, which provides for Articles returned to the United States after having been exported to be advanced in value or improved in condition by any process of manufacture or other means, other.

In responding to your question, we would note that Customs and Border Protection (CBP) has previously ruled in cases with similar circumstances. For instance, in a letter dated April 3, 1989, (File Number 554934, Headquarters ruled that certain peanuts of U.S. origin that were exported to Mexico and there shelled, roasted and salted, did not qualify for treatment under subheading 9802.00.50, HTSUS. The rationale for excluding the goods in question was explained, as follows:

“Subheading 9802.00.50, HTSUS, provides for the assessment of duty on the value of repairs or alterations performed on articles returned to the U.S. after having been exported for that purpose. However, the application of this tariff provision is precluded in circumstances where the operations performed abroad destroy the identity of the articles or create new or commercially different articles. See A.F.Burstrom v. Untied States, 44 CCPA 27, C.A.D. 631 (1957); Guardian Industries Corporation v. United States, 3 CIT 9 (1982). Treatment under subheading 9802.00.50, HTSUS, is also precluded where the exported articles are incomplete for their intended use and the foreign processing operation is a necessary step in the preparation or manufacture of finished articles. Doliff and Company, Inc. v. Untied States, 66 CCPA 77, C.A.D.. 1225, 599 F. 2d 1015 (1979).”

The ruling further concluded that, “[i]n the present case, the U.S. grown peanuts that are shipped to Mexico are commercially different from the peanut product that returns. Additionally, the shelling, roasting, salting or otherwise flavoring constitutes an intermediate step in the preparation of finished peanut products.” We would note, also, a ruling letter of January 20, 1995, (File Number 558797), in which Headquarters ruled that certain U.S. peanuts reprocessed in Holland, where they were sugar-coated, salted, packaged for retail sale and then shipped to the United States. The processes performed abroad were found to constitute “intermediate steps in the preparation of the finished peanuts” which therefore precluded preferential treatment under subheading 9802.00.50, HTSUS.

Although the foreign processing of these almonds would not qualify the returned goods for treatment under heading 9802, HTSUS, we would agree that the product, as imported, retains its identity as U.S. almonds. A Headquarters ruling, dated September 19, 1989, (File Number 084928), held that certain whole, pitted dates from Pakistan that were imported into Canada and, there, macerated, sugar-coated and chopped, did not lose their character or use as dates by virtue of the Canadian processing and so remained products of Pakistan. Treasury Decision 85-158, 19 Cust. Bull. 360, (October 15, 1985), held that the roasting, salting and coloring of pistachio nuts (or any combination of these processes) did not constitute a substantial transformation of the raw pistachios into a new or different article of commerce. In view of these decisions, we believe that these almonds remain products of the United States and are not subject to the requirements of the marking statute, 19 U.S.C. §1304. With regard to country of origin marking on the retail bags in which the product will be imported, when imported, CBT would not require marking, since the nuts are not of foreign origin. The Federal Trade Commission in Washington, D.C., has jurisdiction over goods marked as products of the United States. Consequently, any inquiries regarding the use of phrases reflecting U.S. origin, such as “Grown in the U.S.A.” or “Products of the U.S.A.,” should be directed to that agency.

The applicable subheading for the Almond Crunch will be 2008.19.4000, Harmonized Tariff Schedule of the United States (HTS), which provides for fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere provided for, nuts, peanuts (ground-nuts) and other seeds, whether or not mixed, other, including mixtures, almonds. The rate of duty will be 32.6 cents per kilogram.

This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 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 P. Brady at 646-733-3030.


Robert B. Swierupski

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