HQ 088880

March 19, 1992

CLA-2 CO:R:C:F 088880 RFC/PH

CATEGORY: Classification; Entry

TARIFF NO.: 1806.90.0020; 1806.90.0078; 9904.10.66; chocolate

District Director

U.S. Customs Service

101 East Main Street

Norfolk, VA 23510

RE: Decision on Application for Further Review of Protest No.

1401-90-000216, on the entry of certain chocolate products

Dear Sir:

This is a decision on application for further review of a

protest timely filed on behalf of Holland American Food Company,

on December 17, 1990, against your notice of redelivery and

decision in the tariff classification under the Harmonized Tariff

Schedule of the United States Annotated (HTSUSA) of certain

chocolate products. There were two entries of the products. The

first entry was on March 30, 1990. The second entry was on August

3, 1990. Neither of the two entries was liquidated.

NOTICE OF REDELIVERY

FACTS:

As indicated above, the protestant entered the merchandise on

March 30, 1990 and August 3, 1990. Immediate delivery was

authorized for the first entry on March 30, 1990, and, we

understand, for the second on August 6, 1990. Information and

samples with regard to the March 30, 1990, entry were requested by

Customs (on Customs\' Form 28) on April 25, 1990. The information

and samples were provided to Customs by

communication dated May 11, 1990. We understand that the samples

were sent to the Customs\' laboratory on July 9, 1990. According

to laboratory reports in the file, the laboratory received two of

the samples on July 12, 1990. The dates of the two laboratory

reports for these samples are August 29, 1990. Because of what it

believed to be a discrepancy in one of those laboratory reports,

re-analysis of one of the reports was requested. A supplemental

laboratory report in response to this request is dated October 10,

1990\. No information or samples were requested by Customs with

regard to the August 3, 1990, entry, nor were any samples sent for

analysis with regard to this entry. A notice of redelivery for

certain of the merchandise entered in the March 30, 1990, entry was

sent to the importer of record on October 30, 1990. We understand

that on the same date a notice of redelivery for certain of the

merchandise entered in the August 3, 1990, entry was sent to the

importer of record on the same date. The protest under

consideration was filed on December 17, 1990. On December 24,

1990, a notice of liquidated damages for failure to redeliver the

merchandise was sent to the importer of record with regard to the

March 30, 1990, entry. We understand that such a notice was also

sent with regard to the August 3, 1990, entry on the same date.

According to Customs\' records, the March 30, 1990, entry was

liquidated on May 17, 1991 (the August 3, 1990, entry has not been

liquidated, liquidation having been extended by notice dated May

4, 1991).

The protestant claims that the notices of redelivery involved

were untimely, in that they were not received until seven months

after the original entry. The protestant contends that because of

the time after the original entry which it took to issue the

notices of redelivery, the original importer was led to assume that

there were no more problems with these items. Further, the

protestant states that during this time period the original

importer of record was sold and the purchaser was unaware of any

\"hold of any inventory\" and sold the merchandise in the normal

course of business. Consequently, the protestant states, the

merchandise cannot be returned as ordered.

ISSUES:

Is a notice of redelivery timely when:

\(a\) It is issued more than 30 days after authorization

for immediate delivery and no request for information

(CF 28) is issued or any other action is taken to

establish a conditional release period?

\(b\) A request for information (CF 28) is issued within

30 days of entry and authorization for immediate

delivery, the information and samples requested are

timely provided to Customs, the samples are sent to the

Customs\' laboratory for analysis more than 30 days after

receipt by Customs, laboratory reports are initially

issued for the merchandise more than 30 days after the

samples were sent to the Customs\' laboratory, a second

analysis of the merchandise by the Customs\' laboratory

is provided more than 30 days after the date of the first

laboratory report, and the notice of redelivery is issued

within 30 days of this last laboratory report (but 7

months after the date of entry and authorization for

immediate delivery and more than 5 months after the

information and samples requested were provided to

Customs)?

LAW AND ANALYSIS:

Initially, we note that the protest, with application for

further review, was timely filed under the statutory and regulatory

provisions for protests (see 19 U.S.C. 1514 and 19 CFR Part 174).

We also note that the decision to issue a notice of redelivery is

protestable under the Customs\' protest statute (see 19 U.S.C.

1514(a)(4)).

The Customs\' regulations governing this issue are found in 19

CFR 141.113 and 113.62. Under paragraph (b) of section 141.113:

If at any time after entry the district director finds

that any merchandise contained in an importation is not

entitled to admission into the commerce of the United

States for any reason not enumerated in paragraph (a) of

this section \[relating to various marking and labeling

requirements\], he shall promptly demand the return to

Customs\' custody of any such merchandise which has been

released.

Paragraph (f) of section 141.113 contains a time limitation

for demands for the return of merchandise to Customs\' custody under

section 141.113. Under this provision:

A demand for the return of merchandise to Customs\'

custody shall not be made after the liquidation of the

entry covering such merchandise shall become final.

Section 113.62 contains the basic importation and entry bond

conditions. Under paragraph (c) of this provision:

It is understood that any demand for redelivery will be

made no later than 30 days after the date that the

merchandise was released or 30 days after the end of the

conditional release period (whichever is later).

Our interpretation of these provisions is that a notice of

redelivery must be \"promptly\" issued, that is, it must be issued

either: (1) no later than 30 days after the date the merchandise

is released if there is no occurrence establishing a conditional

release period; or (2) if there is an occurrence establishing a

conditional release period (e.g., see 19 CFR 12.80(e)(2), 19 CFR

134.3, and 19 CFR 151.11), no later than 30 days after the end of

that period (see Customs Service Decision (C.S.D.) 86-21). A

notice of redelivery may never be issued after liquidation becomes

final (United States v. Utex International Inc., 6 Fed. Cir. (T)

166 (1988)).

In the case of the August 3, 1990, entry, there was no

occurrence establishing a conditional release. The notice of

redelivery was issued more than 30 days after the date the

merchandise was released. Therefore, the protest against the

notice of redelivery for this entry must be granted (see C.S.D.

89-100).

In the case of the March 30, 1990, entry, there was an

occurrence establishing a conditional release (i.e., the issuance

of the request for information (CF 28)) and that occurrence was

within 30 days after the date the merchandise was released.

However, the notice of redelivery was not issued until more than

5 months after the date that the information and samples requested

in the request for information were provided. The samples were not

sent to the Customs\' laboratory until more than 30 days after the

date the samples were provided and the final laboratory report was

not issued until more than 3 months after the samples were sent to

the Customs\' laboratory. This does not meet the requirement in 19

CFR 141.113(b) that a notice of redelivery be \"promptly\" issued

(see C.S.D. 90-99). Therefore, the protest against the notice of

redelivery for this entry must be granted.

HOLDING:

A notice of redelivery is not timely when:

\(a\) It is issued more than 30 days after entry and

authorization for immediate delivery and no request for

information (CF 28) is issued or any other action is

taken to establish a conditional release period.

\(b\) A request for information (CF 28) is issued within

30 days of entry and authorization for immediate

delivery, the information and samples requested are

timely provided to Customs, the samples are sent to the

Customs\' laboratory for analysis more than 30 days after

receipt by Customs, laboratory reports are initially

issued for the merchandise more than 30 days after the

samples were sent to the Customs\' laboratory, a second

analysis of the merchandise by the Customs\' laboratory

is provided more than 30 days after the date of the first

laboratory reports, and the notice of redelivery is

issued within 30 days of this last laboratory report (but

7 months after the date of entry and authorization for

immediate delivery and more than 5 months after the

information and samples requested were provided to

Customs).

In light of the above, the protest is granted as to the notice

of redelivery.

CLASSIFICATION

The foregoing determination moots the classification issue

presented in this protest. The following discussion, however, is

offered for your information and assistance in the classification

and liquidation of any open entries on the merchandise and in

ruling on any other open protests on the classification of the

merchandise.

FACTS:

Three products are identified: Ruyter Chocolate Hail-Milk,

Ruyter Chocolate Hail-Mocha, and Ruyter Chocolate Flakes-Milk.

The first two products are described as \"chocolate sprinkles,\" and

the third product is described as \"chocolate shavings.\" The two

chocolate-sprinkle products are said to contain the same

ingredients with the \"mocha\" chocolate-sprinkle product also

containing coffee flavoring.

Laboratory analysis of a sample of the chocolate sprinkles

shows that it contains, among other things, cocoa and 5.5 percent

or less by weight of butterfat. Similar analysis of a sample of

the chocolate shavings shows that it contains, among other things,

cocoa but no butterfat.

The protestant contends that the three products are classified

under the statistical-reporting numbers 1806.90.0075 or

1806.90.0078. On the other hand, Customs has classified all three

of the products under the statistical-reporting number

1806.90.0020.

ISSUES:

\(1\) What is the proper tariff classification under the HTSUSA

of \"chocolate sprinkles\" that contain, among other things, cocoa

and 5.5 percent or less by weight of butterfat?

\(2\) What is the proper tariff classification under the HTSUSA

of \"chocolate shavings\" that contain, among other things, cocoa but

no butterfat?

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 6 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.

A review of the schedule reveals that the instant products

may be classified in chapter 18. This chapter covers \"cocoa and

cocoa preparations.\" Of special significance to the instant

classification analysis is note 2 to chapter 18. This note states

that:

Heading 1806 includes sugar confectionery containing cocoa,

and, subject to note 1 to this chapter, other food

preparations containing cocoa.

Turning to heading 1806, one finds that it provides for \"chocolate

and other food preparations containing cocoa.\"

As the instant products are food preparations containing cocoa,

then the products are properly classified under heading 1806.

The instant products have been found to be properly classified

under heading 1806. Consideration must now be given to the proper

subheading in heading 1806 in which to classify the products. Of

significance to classification of the instant products in heading

1806, however, is the issue of whether any of the products is a

\"confection\" or \"confectionery.\"

The terms \"confection\" and \"confectionery\" refer to and

describe products that are ready for consumption as an end product

(e.g., candy bars) and not for use in the production of another

product (e.g., decorations for cakes or pies). See Webster\'s Ninth

New Collegiate Dictionary 274 (1989) (confection is \"a fancy dish

or sweetmeat; also: a sweet food\" and confectionery are \"sweet

foods (as candy or pastry)\"); Webster\'s Third International

Dictionary 475 (1986) (confection is a \"delicacy; usu: a

preparation of fruits, nuts, roots, or other morsels with sugar:

sweetmeat, preserve, candy\" and confectionery are \"sweet edibles

(as candy, cake, pastry, candied fruits, ice cream)\...\"); The

Random House Dictionary of the English Language 307 (1983)

(confection is \"a sweet preparation of fruit or the like, as a

preserve or candy\" or \"a piece of candy; bonbon\" and confectionery

are \"confections or sweetmeats collectively\"). The instant

products are all for use in the making of an end product (i.e.,

decorations for pies, cakes, etc.) rather than as an end product

in themselves. Accordingly, one can only conclude that none of the

instant products is either a \"confection\" or \"confectionery.\"

In light of their ingredients and of the fact that they are

not considered to be a confection or confectionery, the instant

products are classified as follow: The \"chocolate sprinkles\" are

classified under the statistical-reporting number 1806.90.0020 and

the \"chocolate shavings\" are classified under the statistical-

reporting number 1806.90.0078.

HOLDING:

Ruyter Chocolate Hail-Milk

The product identified above as \"Ruyter Chocolate Hail-Milk\"

and described as \"chocolate sprinkles\" is properly classified under

the statistical-reporting number 1806.90.0020, which provides for

chocolate and other food preparations containing cocoa, other,

subject to quota established pursuant to section 22 of the

Agricultural Adjustment Act, as amended: provided for in subheading

9904.10.66. The general rate of duty for the year 1990 is 7

percent ad valorem.

Products provided for in the statistical-reporting number

1806.90.0020 are subject for the year 1990 to the quota

restrictions of 9904.10.66. Under this subheading, with the

exception of such goods originating from the United Kingdom,

Ireland, and New Zealand, there exists a total ban or embargo on

the importation of goods provided for in 1806.90.0020 into the

United States (i.e., none can be imported into the United States).

Ruyter Chocolate Hail-Mocha

The product identified above as \"Ruyter Chocolate Hail-Mocha\"

and described as \"chocolate sprinkles\" is properly classified under

the statistical-reporting number 1806.90.0020, which provides for

chocolate and other food preparations containing cocoa, other,

subject to quota established pursuant to section 22 of the

Agricultural Adjustment Act, as amended: provided for in subheading

9904.10.66. The general rate of duty for the year 1990 is 7

percent ad valorem.

Products provided for in the statistical-reporting number

1806.90.0020 are subject for the year 1990 to the quota

restrictions of 9904.10.66. Under this subheading, with the

exception of such goods originating from the United Kingdom,

Ireland, and New Zealand, there exists a total ban or embargo on

the importation of goods provided for in 1806.90.0020 into the

United States (i.e., none can be imported into the United States).

Ruyter Chocolate Flakes-Milk

The product identified above as \"Ruyter Chocolate Flakes-

Milk\" and described as \"chocolate flakes\" is properly classified

under the statistical-reporting number 1806.90.0078, which provides

for chocolate and other preparations containing cocoa, other,

other, other put up for retail sale, other. The general rate of

duty for the year 1990 is 7 percent ad valorem. Products

classified under the statistical-reporting number 1806.90.0078 for

the year 1990 are not subject to a quota restriction.

A copy of this decision should be furnished to the protestant

with the Form 19 notice of action.

Sincerely,

John Durant, Director

Commercial Rulings Division