CBP Finds FTZ Blend of Mostly Foreign Sugar and Some U.S. Corn Syrup Retains Foreign Origin
A blended syrup consisting of mostly Brazilian cane sugar with some U.S. corn syrup does not undergo a substantial transformation, because it remains a sugar syrup, said CBP in a classification and country of origin ruling. Therefore, the country of origin of the product is Brazil, it said.
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The merchandise at issue consists of blended syrups imported by Arbor Foods. All ingredients are imported into a foreign-trade zone, and further manufactured before importation into the U.S. for consumption. The blended syrups are made by dissolving Brazilian granular cane sugar in water, then mixing it with U.S. corn syrup. The solids in the blend are 90% sucrose from cane sugar, and 10% glucose from corn syrup. The syrups contain no fructose or added flavoring or coloring. Arbor Foods requested the ruling to determine the correct classification and country of origin of the merchandise.
In HQ H234949, CBP ruled that the blended syrups are correctly classified in Harmonized Tariff Schedule subheading 1702.30.22 (“Other sugars, including chemically pure lactose, maltose, glucose and fructose, in solid form; sugar syrups not containing added flavoring or coloring matter …: Glucose and glucose syrup, not containing fructose or containing in the dry state less than 20 percent by weight of fructose: Blended syrups described in additional U.S. note 4 to chapter 17: Described in general note 15 of the tariff schedule and entered pursuant to its provisions”). The syrups are covered under general note 15(d), because Arbor Foods gave proof that (1) its FTZ facility has been in operation since June 1, 1990; and (2) it has continued operating on the same quantity of foreign-origin sugar authorized in 1985, CBP said.
Turning to classification, CBP noted that in a 2006 decision also involving an Arbor Foods product CIT found that mixing a glycine with sugar substantially transformed the product. Nonprivileged foreign status merchandise that is substantially transformed in an FTZ becomes a product of the United States, it said.
But in this case, no such substantial transformation occurred. The product remains a mixture of sugars, and is a sweetener. It retains the same use and character after production, and only undergoes the simple operation of mixing. CBP ruled that the country of origin for the blended syrup is Brazil, the country of origin of the cane sugar, which makes up 90% of the finished product by solid weight.