CAFC Affirms Classification of Roasted Sunflower Seeds as Food Preparations
Roasted sunflower seeds imported by Well Luck are classifiable in the tariff schedule as prepared foods, not in a subheading specifically for sunflower seeds, the U.S. Court of Appeals for the Federal Circuit said as it affirmed a lower court ruling, albeit with different reasoning. Though the seeds are classifiable in both subheadings, the subheading for prepared foods is more specific because it involves additional processing and is more difficult to satisfy, the Federal Circuit said.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
The Court of International Trade had in February 2017 come to the same conclusion, but had done so based on language in the explanatory notes limiting Well Luck’s preferred subheading 1206.00.0000 for “sunflower seeds” to seeds not processed in a way that renders them unsuitable for sowing (see 1702160028). The production process of Well Luck’s seeds includes a heating step that renders them unplantable, making them ineligible for the duty-free subheading, CIT had said, instead finding the seeds classifiable in subheading 2008.19.90 for prepared or preserved seeds, dutiable at 17.9%.
CIT’s reliance on the explanatory notes was incorrect, the Federal Circuit said. The explanatory notes can’t be used to narrow the language of a tariff subheading, and should not be given any weight at all when inconsistent with a tariff provision’s plain meaning, the Federal Circuit said, citing a series of tariff classification cases. Regardless of the instructions in the explanatory note, heading 1206 explicitly covers sunflower seeds, so Well Luck’s roasted sunflower seeds are included in that heading, the court said.
But heading 2008 also covers Well Luck’s roasted sunflower seeds, the Federal Circuit said. That heading covers seeds that are fit to be eaten and either made ready for consumption or treated or refrigerated to prevent decomposition or fermentation, it said. As now conceded by Well Luck, the importer’s product “indisputably is made ready for consumption through processing, flavoring, and packaging,” and is classifiable in heading 2008, the court said.
General Rule of Interpretation 3(a) provides that the heading with “the most specific description shall be preferred to headings providing a more general description.” Heading 2008 is more specific than heading 1206, the Federal Circuit said. Heading 2008’s requirement that the subject merchandise be prepared or preserved “renders it more difficult to satisfy than sunflower seeds in HTSUS Heading 1206 because preparation and preservation involve processing or addition of ingredients,” it said. As it is more difficult to satisfy, it is the more specific heading, and wins out under GRI 3(a), the appeals court said.
(Well Luck Company, Inc., v. U.S., CAFC 17-1816, dated 04/11/18, Judges Reyna, Wallach and Hughes)
(Attorneys: Luis Arandia Jr. of Givens & Johnston for plaintiff-appellant Well Luck Company, Inc.; Alexander Vanderweide for defendant-appellee U.S. government)