The U.S. Chocolate Tariff-Rate Quota: A Compliance Perspective (Plus a Debate About Candy)

Trade compliance teaches humility. Sometimes that humility comes from parsing the Uruguay Round; sometimes it comes from your spouse in the candy aisle at H-E-B.

Let’s set the stage.

As an update to my video on this subject in 2024, CBP’s Quota Bulletin 26-216 2026 for the 2026 quota year reminds us that the United States still maintains a tariff-rate quota (TRQ) on chocolate—specifically, chocolate containing more than 5.5% butterfat, excluding retail candy bars. This quota is administered under Additional U.S. Note 2 to Chapter 18, which covers a surprisingly wide range of cocoa and chocolate preparations.

Here’s the trade-logic problem:

Many of the products subject to this quota contain no sugar at all.

They are cocoa mass, cocoa butter, and chocolate liquor—inputs used by U.S. chocolate manufacturers.

So, the obvious question is:

Why would the U.S. restrict imports of industrial cocoa materials that domestic processors actually need?

Short answer: because this TRQ persists for structural, not economic, reasons.

Longer answer:

1. The chocolate TRQ is not designed to protect domestic chocolate manufacturers.

If anything, it disadvantages them. Restricting the supply of upstream cocoa inputs raises domestic processing costs while allowing unlimited imports of finished chocolate bars. That is the reverse of what a protectionist measure would normally do.

2. There is no direct policy rationale tied to sugar, sweeteners, or confectionery controls.

The scope of the TRQ covers many products that are entirely unsweetened. This means the quota is not aimed at controlling sugar-containing imports or protecting sweetener producers. The plain text of Additional U.S. Note 2 makes that clear.

3. The most plausible explanation is WTO history—supported by reasoned inference.

During the Uruguay Round (1994–1995), the United States was required to convert certain pre-existing agricultural import restrictions into tariff-rate quotas as part of the Agreement on Agriculture’s “tariffication” process.

There is no public record explicitly stating why cocoa preparations were included in the U.S. TRQ schedule. However, it appears likely—based on the structure of the U.S. Schedule of Concessions and the categories of goods that underwent tariffication—that cocoa-based preparations were swept into the broader group of “processed agricultural products” subject to conversion at the time.

Once established in the U.S. Schedule, these TRQs become legally and politically persistent. Removing or modifying one requires renegotiation or compensation at the WTO—something no agency is motivated to pursue for a niche commodity.

In short:

The chocolate TRQ survives not because it makes sense, but because changing it would be more hassle than leaving it alone.

Where Chocolate Meets Mansplaining: A Cautionary Tale

Now let’s connect this to the question that has destroyed marriages—and classification debates:

Is chocolate candy?

As a lifelong fan of dark chocolate, I treated this as settled law—until my wife, an architect from Mexico City, corrected me in the most devastatingly polite way possible.

We were in the grocery store. I said, “I’m hungry.” She said, “Do you want a chocolate?”

(Here comes the part where I make bad decisions.)

I said, “No sweetheart, I don’t want any candy.”

She looked at me with absolute innocence.

“Chocolate is not candy.”

Nobody tells me I’m wrong. Not in the candy aisle. So, I—brilliantly—walked her over to the section marked CANDY and pointed triumphantly at the chocolate bars.

She gently replied:

“Chocolate comes from the ground seeds of the cacao tree, with a little sugar added. It’s kind of like peanut butter. Those gummy bears next to it? That’s candy.”

And she was right. Again.

The Harmonized System (the basis of the Harmonized Tariff Schedule of the US, or HTSUS) backs her up:

• Chapter 17: Sugar and Sugar Confectionery (candy)
• Chapter 18: Cocoa and Cocoa Preparations (chocolate)

Even the World Customs Organization separates candy from chocolate. The U.S. grocery store aisle is the outlier—just like our chocolate TRQ.

Which leads to the real moral of the story:

• Chocolate ≠ candy.
• Chocolate is good for you.
• My wife is right more often than I am.
• And the chocolate TRQ exists because of WTO inertia, not coherent trade policy.

Tell everyone.