H325687

HQ H325687 June 2, 2023 OT:RR:CTF:FTM H325687 JER CATEGORY: Classification TARIFF NO.: 1518.00.40 Mr. Matthew Thomas Blank Rome, LLP 1825 Eye St., NW Washington, DC 20006 RE: Classification of Agricultural Oil Feedstock Dear Mr. Thomas: This is in response to your request, dated June 8, 2022, on behalf of your client, [******] (“Importer”), in which you request a binding ruling regarding the classification of processed agricultural oil feedstock under the Harmonized Tariff Schedule of the United States (“HTSUS”). In reaching the determination below, we have considered information presented in your initial correspondence (hereinafter “ruling request”) as well as your supplemental submissions dated September 12, 2022, and November 14, 2022. Within your request for a binding ruling, you asked that certain information submitted in connection with this request be treated as confidential. Inasmuch as this request conforms to the requirements of 19 C.F.R. § 177.2(b)(7), your request for confidentiality is approved. The information contained within the brackets of your request will not be released to the public. FACTS: The merchandise to be imported is described as comingled crude soybean oil, tallow, and distiller’s corn oil (“DCO”). The tallow and DCO are obtained from waste streams from the food processing industry while the soybean oil is obtained in its crude form. The three agricultural oils are obtained in Country A (the United States) and then shipped to Country B [******] for processing. According to the submission, while in Country B [******], each agricultural oil will undergo a separate four-step treatment process to remove contaminants such as metals (calcium, magnesium, and others), phosphorus, free fatty acid, and chlorides. The four-step treatment process consists of: (1) acid pretreatment, used to dissociate phospholipid metal salts and degumming, i.e., the process of hydrating phosphatides present in the oil by adding water, followed by centrifugation; (2) water washing, which further reduces metals and soaps; (3) silica purification with silica gel, which involves the filtering of silica through bleaching filters; and (4) bleaching, using acid activated earth. During the acid treatment and degumming process, the oils undergo heating and cooling, and are channeled through an acid mixer, an acid reactor, a hydration reactor, and a centrifugal separator. After treatment, the oils are mixed together into one feedstock product consisting of [******] soy oil, [******] tallow, and [******] DCO. The feedstock is made up of primarily triglycerides (70-90%) and trace amounts of fatty acids (less than 1%), phosphorus (less than 1%), iron (less than 1%), nitrogen (less than 10%), sulphur (less than 5%), potassium (less than 1%), magnesium (less than 2%), calcium (less than 3%), and trace metal elements and small quantities of mono-alkyl esters. After importation the treated agricultural oil will be processed in a petroleum refinery to make renewable diesel. ISSUE: What is the tariff classification of the processed agricultural oil feedstock under the HTSUS? LAW AND ANALYSIS: Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification shall be determined according to the terms of the headings of the tariff schedule 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, the remaining GRIs 2 through 6 may then be applied in order. The HTSUS provisions under consideration are as follows: 1502: Fats of bovine animals, sheep or goats, other than those of heading 1503: 1502.10.00: Tallow. . . . 1507: Soybean oil and its fractions, whether or not refined, but not chemically modified: 1507.10.00 Crude oil, whether or not degummed. . . . 1515: Other fixed vegetable or microbial fats and oils (including jojoba oil) and their fractions, whether or not refined, but not chemically modified: Corn (maize) oil and its fractions: 1515.21.00: Crude oil . . . . 1518: Animal, vegetable or microbial fats and oils and their fractions, boiled, oxidized, dehydrated, sulfurized, blown, polymerized by heat in vacuum or in inert gas or otherwise chemically modified, excluding those of heading 1516; inedible mixtures or preparations of animal, vegetable or microbial fats or oils or of fractions of different fats or oils of this chapter, not elsewhere specified or included: 1518.00.40: Other . . . . 2710: Petroleum oils and oils obtained from bituminous minerals, other than crude; preparations not elsewhere specified or included, containing by weight 70 percent or more of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations; waste oils: 3826: Biodiesel and mixtures thereof, not containing or containing less than 70 percent by weight of petroleum oils or oils obtained from bituminous materials: * * * * * * Note 2 to Chapter 27, HTSUS, provides that: References in heading 27.10 to “petroleum oils and oils obtained from bituminous minerals” include not only petroleum oils and oils obtained from bituminous minerals, but also similar oils, as well as those consisting mainly of mixed unsaturated hydrocarbons, obtained by any process. Note 7 to Chapter 38, HTSUS, provides that: For the purposes of heading 38.26, the term “biodiesel” means mono-alkyl esters of fatty acids of a kind used as a fuel, derived from animal or vegetable fats and oils, whether or not used. * * * * * * The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the HTSUS. While not legally binding or dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings at the international level. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989). General EN(A) to Chapter 15 provides, in pertinent part, as follows: This Chapter covers: (1) Animal, vegetable or microbial fats and oils, whether or not purified or refined or treated in certain ways (e.g., boiled, sulphurised or hydrogenated). General EN(B) to Chapter 15 provides, in pertinent part, as follows: Headings 15.07 to 15.15 of this Chapter cover the single (i.e., not mixed with fats or oils of another nature), fixed vegetable fats and oils mentioned in the headings, together with their fractions, whether or not refined, but not chemically modified. Vegetable fats and oils occur widely in nature and are found in the cells of certain parts of plants (e.g., seeds and fruit), from which they are extracted by pressure or by means of solvents. EN 15.07 provides, in pertinent part, as follows: Subheading 1507.10 Fixed vegetable oils, fluids, obtained by pressure, shall be considered “crude” if they have undergone no processing other than decantation, centrifugation or filtration, provides that, in order to separate the oils from solid particles only mechanical force, such as gravity, pressure or centrifugal force, has been employed, excluding any adsorption filtering process, fractionation or any other physical chemical process. If obtained by extraction an oil shall continue to be considered as “crude”, provided it has undergone no change in colour, odour or taste when compared with the corresponding oil obtained by pressure. EN 15.15 provides, in pertinent part, as follows: This heading covers single, fixed vegetable or microbial fats and oils and their fractions (see the General Explanatory Note, Part (B)) other than those specified in headings 15.07 to 15.14. The following are of particular commercial importance: … Maize (corn) oil, obtained from the kernels of maize, most of the lipids (around 80%) being contained in the germ. The crude oil has many industrial uses, e.g., in making soap, lubricants, leather dressing, etc. The refined oil is

Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification shall be determined according to the terms of the headings of the tariff schedule 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, the remaining GRIs 2 through 6 may then be applied in order. The HTSUS provisions under consideration are as follows:1502: Fats of bovine animals, sheep or goats, other than those of heading 1503:1502.10.00: Tallow. . . .1507: Soybean oil and its fractions, whether or not refined, but not chemically modified:1507.10.00 Crude oil, whether or not degummed. . . .1515: Other fixed vegetable or microbial fats and oils (including jojoba oil) and their fractions, whether or not refined, but not chemically modified:Corn (maize) oil and its fractions:1515.21.00: Crude oil . . . .1518: Animal, vegetable or microbial fats and oils and their fractions, boiled, oxidized, dehydrated, sulfurized, blown, polymerized by heat in vacuum or in inert gas or otherwise chemically modified, excluding those of heading 1516; inedible mixtures or preparations of animal, vegetable or microbial fats or oils or of fractions of different fats or oils of this chapter, not elsewhere specified or included:1518.00.40: Other . . . .2710: Petroleum oils and oils obtained from bituminous minerals, other than crude; preparations not elsewhere specified or included, containing by weight 70 percent or more of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations; waste oils:3826: Biodiesel and mixtures thereof, not containing or containing less than 70 percent by weight of petroleum oils or oils obtained from bituminous materials: * * * * * *Note 2 to Chapter 27, HTSUS, provides that: References in heading 27.10 to “petroleum oils and oils obtained