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Court Classifies Carnitine in Duty-Free Vitamin Provision

Thursday, September 29, 2016
Sandler, Travis & Rosenberg Trade Report

The Court of Appeals for the Federal Circuit ruled Sept. 26 that two dietary supplement ingredients – acetyl l-carnitine taurinate hydrochloride with 1.5 percent silica and glycine propionyl l-carnitine hydrochloride USP with 1.5 percent silica – are properly classified as vitamins under HTSUS 2936.29.50 (duty-free). The CAFC notes that carnitine (sometimes referred to as vitamin Bt) is a naturally occurring amino acid derivative and an important nutrient in the human body.

The Court of International Trade determined that carnitine is classifiable as both a vitamin and a quaternary ammonium salt under HTSUS 2923.90.00 (6.2 percent duty) and, applying the rule of relative specificity in GRI 3, concluded that it is classifiable under the latter subheading because it constitutes a more specific description. However, the government now acknowledges that the court should instead have applied Note 3 to HTSUS Chapter 29, which states that goods that can be classified in two or more of the headings of this chapter are to be classified in the one that occurs last in numerical order.

The CAFC concludes that the subject carnitine meets this criterion. Both sides agree it is classifiable as a quaternary ammonium salt, and the court upholds the CIT’s conclusion that it is also prima facie classifiable as a vitamin, which the court defines as organic chemical substances that are essential micronutrients because the body cannot generally produce them at all or in sufficient amounts.

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