Ruling of the Week: Rice Krispies Treats

I had a long run of covering at least one CBP ruling every week. I enjoyed doing that as it allowed me to find an odd ruling and use it as a tool to illustrate some point. That fell by the wayside, mainly because of the time commitment it takes to do actual work and also write other content for the blog. On the other hand, I kind of miss it. Others have tried to fill that space. I am looking at you, Crowell & Moring. 

Today, I am inspired to jump back in. That inspiration came in the form of the printed New York Times. In today's Science Times, there was an interesting and entertaining discussion of whether a reasonably functional traffic barrier could be made of Rice Krispies Treats. In the course of that discussion, the author quotes Customs & Border Protection for what seems to be an "official" description of a Rice Krispies Treat. According to the Article: "[T]he Tariff Classification and Marking Branch, a part of U.S. Customs and Border Protection, describes them as 'moist, gooey, sticky, easily malleable, and very sweet like a marshmallow . . . .'"

That surprise appearance by CBP at my breakfast table caused me to look up the source of the quote. It comes from HQ H200575 (Apr. 16, 2012). In the ruling, CBP grappled with three questions. First, what is the classification of a brick made of cereal and marshmallow? Second, is said brick entitled to NAFTA treatment when made in and imported from Mexico? Third, how should said brick be labeled to show its country of origin?

On the classification, the competing headings were 1704 covering sugar confectionery and 1904 covering prepared foods obtained by swelling or roasting cereal products not elsewhere specified or included.

After apparently eating one (or more) Rice Krispies Treat, CBP determined that it is sweet. It also determined that more than 50% of each bar is sugar. Customs noted that the bars are sold ready to eat and not as ingredients on other products. More on that later. Finally, the bars are sold with snack bars and sometimes alongside candy, Consequently, CBP held that the treats are classified as confections in Heading 1704. 

On the NAFTA front, the the non-originating materials used in the production (is it baking?) of these treats underwent the required change in tariff classification. So, the treats are NAFTA originating. Similarly, each foreign ingredient underwent the change in tariff classification required by the NAFTA marking rules. Consequently, they could be marked as products of Mexico.

And there you have a new Ruling of the Week (although it is an old ruling).

I do want to have a discussion about the notion that Rice Krispies Treats are not ingredients in other prepared foods. I watch a lot of competitive baking. Everything from the always informative The Great British Baking Show to the almost painful Nailed It. I watch enough of this genre of television to know that Duff was robbed and that Adriano Zumbo is a magician. I also know that "crisped rice treats" are the go-to material to fill gaps and create structures in what for some reason people continue to call "cake." Crisped rice, as they are generically called when allowed on these programs, is the drywall of the baking industry. So, while this has not bearing whatsoever on the CBP ruling, it think it is fair to say that bricks of puffed rice and marshmallow are actually building materials of Heading 6808. In this case, the rice is the vegetable fiber and the marshmallow is the binder.

Kellogg's call me if you want to try that, but not on a contingent fee basis.



Comments

Post a Comment

Popular posts from this blog

Ruling of the Week 2015.8: Old Jersey and Pitcairn Island

Image
For today's ROTW, I set out looking for a ruling dealing with some far off and preferably warm location. Turns out that, with the exception of coastwise transit issues, there are no Customs and Border Protection rulings involving Pitcairn Island or any of several Pacific Ocean microstates including Tuvalu , Niue , and Kiribati . Pitcairn Island What I did find is an interesting question about the country of origin marking for products of the Bailiwick of Jersey Island, Channel Islands. The ruling is HQ 561938 (Mar. 18, 2002). For those of you who may not know, Jersey is an island off the coast of Normandy, France. It is an independent international actor and not part of the U.K. although the U.K. is responsible for its defense and external relations. Also, the Queen is the Head of State in her capacity as "the Crown in Right of Jersey." It is, according to the U.S. Department of State, a " Crown Dependency " along with the Isle of Man and the Bailiwick o...
Read more

CAFC Decision in Double Invoicing Case

The Federal Circuit has issued a decision on the merits in United States v. Inn Foods, Inc.  There had been a previous decision on jurisdiction, which was followed by a trial at the Court of International Trade and then this appeal on the substance. The initial issue is whether Inn Foods' invoicing practice amounts to fraud.  Inn Foods had been receiving an invoice from growers in Mexico that had a relatively low sales prices on it.  Subsequent to entry, Inn Foods created a second invoice at something more similar to market value, retaining the original invoice number, and paid at that higher amount.   Superficially, this looks like a standard-issue double-invoicing scheme.  But, in the age of reconciliation, is it really more like a provisional pricing mechanism?  It might have been possible to make that argument had Inn Foods adjusted its entries accordingly.  It didn't and the loss of revenue was approximately $624,000.  Based on testimony and evidence indicating both knowl...
Read more

Ninestar and UFLPA Exhaustion

Image
Exhaustion is a key doctrine in administrative law. When applicable, it requires that a party unhappy with an agency’s determination complete the administrative appeal process before turning to the courts for judicial review. Requiring exhaustion typically promotes judicial efficiency by ensuring that disputes are resolved at the agency and, if they are not, that there is a complete record of the agency process. Exhaustion also ensures that the judiciary respects the executive agencies and their expertise.  There are, on the other hand, times when the courts will find that exhaustion is not necessary or appropriate. Such is the case in  Ninestar Corporation et al. v. United States  et al., a decision of the U.S. Court of International Trade.  Ninestar is also interesting because it is one of the first cases in the CIT involving the Uyghur Forced Labor Prevention Act, known as UFLPA. In my hiatus from active blogging, I missed the rise of UFLPA as a major compliance t...
Read more