CLA-2 RR:TC:MM 959301 PH

Port Director
U.S. Customs Service
200 St. Paul Place
Baltimore, MD 21202

RE: Protest 1303-96-100003; stone articles; serpentine; fireplace surrounds; slabs; semi-precious; other stone; 6802.91.05; 6802.99.00; 7116.20.40; Note 1(d), Chapter 68; Note 2, Chapter 68; Note 1(a), Chapter 71; EN 25.16; EN 68.02; EN Annex to Section XIV; EN 71.16; HRLs 085266; 960193; 959493; 952679; protest, what is; void or voidable reliquidation; 19 U.S.C. 1501; 19 U.S.C. 1514; HRL 222875

Dear Port Director:

This is in response to Protest 1303-96-100003, which pertains to the tariff classification of certain articles of stone under the Harmonized Tariff Schedule of the United States (HTSUS). According to the file and Customs records, the date of entry of the merchandise is January 26, 1995.

FACTS:

The stone articles are described on the invoice as "SETS MARBLE FACING FOR FIREPLACE AND GRANITE SLABS" and, within that description, "FIREPLACE (GREEN)" and "SLAB" (the bill of lading, packing/weight list, and Certificate of Origin describe the merchandise similarly). There are a total of 120 sets, under the "FIREPLACE (GREEN)" description, each with four pieces of stone. The sets come in two sizes (i.e., 88 sets with one piece 1397 X 178 X 19 m/m, two pieces 914 X 178 X 19 m/m, and one piece 1524 X 508 X 19 m/m, and 32 sets with one piece 1524 X 216 X 19 m/m, two pieces 914 X 216 X 19 m/m, and one piece 1829 X 508 X 19 m/m). There are 24 "SLAB[s]", either 20 or 30 m/m thick and between 2380 and 2760 by between 1520 and 1640 m/m.

The merchandise was entered as "STONE, MRBLE SLABS, WRK, NOT FLAT" under subheading 6802.91.05, HTSUS, with duty in the amount of $531.41. The entry was initially liquidated, as entered, on May 19, 1995. In a Notice of Action (Customs Form 29) dated July 21, 1995, Customs advised that the entry was being subject to a rate advance, with the explanation that the "[c]orrect classification for serpentine slabs for fireplace sets is [subheading] 7116.20.4000 [HTSUS] @ 18.9%." On August 18, 1995, the entry was reliquidated under 19 U.S.C. 1501 and 19 CFR 173.2 and 173.3, with duty in the amount of $3,719.90, under subheading 7116.20.40, HTSUS.

In a letter to your office dated August 25, 1995, the protestant stated that it had just received the bill for the protested entry and that the protestant "... would appreciate [Customs] reviewing the enclosed documents and sending us a corrected invoice." Attached to the letter is a bill dated August 18, 1995, for $3,188.49 (principal) and $161.25 (interest). The enclosed documents are stated to include a photocopy of the entry summary, and the above-described invoice, packing/weight list, Certificate of Origin, and bill of lading. As noted above, the classification stated on the entry summary was subheading 6802.91.05, HTSUS, and each of the listed documents described the merchandise as "SETS MARBLE FACING FOR FIREPLACE AND GRANITE SLABS."

On October 20, 1995, the entry was reliquidated a second time, purportedly under the same authority as the August 18, 1995, reliquidation, with duty in the amount of $2,151.25 (in this reliquidation, the 120 sets described above were classified under subheading 7116.20.40, HTSUS, and the slabs were classified under subheading 6802.91.05, HTSUS).

The protest under consideration was filed on January 2, 1996. The protestant contends that the merchandise should be classified under chapter 68, HTSUS, and that if not properly classified under subheading 6802.91.05, then the merchandise should be classified under subheading 6802.99.00. According to the protest:

The merchandise at issue consists of flat, rectangular slabs of serpentine stone finished on one side. After importation, the merchandise is cut and the edges finished (beveled and polished), as required by the incorporation of the merchandise into specific construction applications. A typical application by the [i]mporter is in the fabrication of fireplace veneers.

The protestant submitted pictures of the merchandise under consideration, including pictures of large blocks of serpentine, a large block of serpentine being cut with a diamond wire saw, use of serpentine slabs as floor veneer, serpentine slabs being used as a non-combustible construction veneer surrounding a fireplace, crates of fireplace veneer (each crate stated to hold enough for eight fireplaces), fireplace veneer slabs ready for cutting to exact sizes, and the beveled and polished edge of a slab of fireplace veneer. In each case, the photographed material is described as "serpentine."

The competing subheadings, as of the time under consideration, are as follows:

6802.91.05 Worked monumental or building stone (except slate) and articles thereof, other than goods of heading 6801; mosaic cubes and the like, of natural stone (including slate), whether or not on a backing; artificially colored granules, chippings and powder, of natural stone (including slate) ...: Other: Marble, travertine and alabaster: Marble: Slabs.

The 1995 general column one rate of duty for goods classifiable under this provision is 2.7% ad valorem.

6802.99.00 Worked monumental or building stone (except slate) and articles thereof, other than goods of heading 6801; mosaic cubes and the like, of natural stone (including slate), whether or not on a backing; artificially colored granules, chippings and powder, of natural stone (including slate) ...: Other: ... Other stone.

The 1995 general column one rate of duty for goods classifiable under this provision is 6.5% ad valorem.

7116.20.40 Articles of natural or cultured pearls, precious or semiprecious stones (natural, synthetic or reconstructed): ... Of precious or semiprecious stones (natural, synthetic or reconstructed): ... Other: ... Other.

The 1995 general column one rate of duty for goods classifiable under this provision is 18.9% ad valorem.

ISSUES:

(1) Are the reliquidations of the protested entry, the first reliquidation 91 days after initial liquidation and the second 154 days after the initial liquidation, valid? (2) Are the serpentine stone fireplace surrounds and individual slabs classified as marble slabs under subheading 6802.91.05, HTSUS, other stone under subheading 6802.99.00, HTSUS, or other articles of semi-precious stones under subheading 7116.20.40, HTSUS?

LAW AND ANALYSIS:

There are serious deficiencies in the liquidation and protest procedures followed in this case. The entry was timely liquidated (within 1 year of the date of entry when liquidation is not extended or suspended - 19 U.S.C. 1504(a)). The August 18, 1995, reliquidation, purported to be a reliquidation under 19 CFR 173.2 and 173.3, was without authority of law. The reliquidation was 91 days after the date of notice of the initial liquidation; the statute (19 U.S.C. 1501) and regulations promulgated thereunder (19 CFR 173.3(a)) require such reliquidations to be within 90 days from the date on which notice of the original liquidation is given. The second reliquidation, on October 20, 1995, also purported to be a reliquidation under 19 CFR 173.2 and 173.3, was also without authority of law (it was 154 days after the date of notice of the initial liquidation). In this regard, we emphasize that the time for so-called "voluntary" reliquidations under 19 U.S.C. 1501 and 19 CFR 173.2 and 173.3 is 90 days from the date on which notice of the original liquidation is given; that is, there may be more than one voluntary reliquidation of an entry under 19 U.S.C. 1501 but all such reliquidations must be within 90 days from the date of notice for the original liquidation.

The effect of these procedural deficiencies is as follows. An untimely reliquidation by Customs under 19 U.S.C. 1501 is not void, but rather merely voidable (see Philip Morris v. United States, 13 CIT 556, 716 F. Supp. 1479 (1989) (affirmed in part and reversed in part in an unpublished decision of the Court of Appeals for the Federal Circuit, 8 Fed. Cir. (T) 187, 907 Fed. 2d 158 (1990)), and cases cited therein, including Omni U.S.A., Inc. v. United States, 6 Fed. Cir. (T) 99, 840 F. 2d 912 (1988), cert. den., 488 U.S. 817 (1988), rehearing den., 488 U.S. 961 (1988); see also HQ 222875, dated May 15, 1991). "Neither the legality nor the correctness of a reliquidation by Customs may be disturbed unless a timely protest is filed according to the procedures in 19 U.S.C. 1514 ... and failure to do so within the stated period leaves the reliquidation final" (Philip Morris, supra, 13 CIT at 558). In the case under consideration, the protestant timely protested the October 20, 1995, reliquidation and, therefore, that reliquidation is voided and the protest is granted in this regard.

The August 18, 1995, reliquidation was also untimely under the statute and regulations (see above). However, unless that reliquidation was timely protested, neither its legality nor its correctness may be disturbed (see Philip Morris, supra).

In its August 25, 1995, letter, the protestant stated that it had just received the bill for the protested entry and it would appreciate Customs review of the documents enclosed by the protestant (a photocopy of the entry summary, invoice, packing/weight list, Certificate of Origin, and bill of lading). The protestant asked for a corrected invoice. This is the only communication in the file that could possibly be considered a protest of the August 18, 1995, reliquidation.

The Courts have frequently addressed the question of what sort of communication may be treated as a protest. In the U.S. Supreme Court case of Arthur v. Morgan, 112 U.S. 495 (1884), that Court stated:

A protest is not required to be made with technical precision, but is sufficient if it shows fairly that the objection afterwards made at the trial was in the mind of the party and was brought to the knowledge of the collector, so as to secure to the government the practical advantage which the statute was designed to secure. [112 U.S. at 501.]

Similarly, in Eaton Manufacturing Co. v. United States, 60 CCPA 23, C.A.D. 1076, 469 F. 2d 1098 (1972), the Court stated:

This statutory provision [i.e., 19 U.S.C. 1514] and its predecessors have been construed to mean that a protest must be sufficiently precise to insure that the collector will know what it is in the mind of the protestant ... and to indicate that the objection taken at trial was fairly in the mind of the protestant when the protest was made. [60 CCPA at 29.]

In Mattel, Inc. v. United States, 72 Cust. Ct. 257, C.D. 4547, 377 F. Supp. 955 (1974), the Court concluded, after reviewing the treatment by the Courts of the issue of the sufficiency of a protest:

In short, the court, taking a liberal posture, has held that, however cryptic, inartistic, or poorly drawn a communication may be, it is sufficient as a protest for purposes of section 514 if it conveys enough information to apprise knowledgeable officials of the importer's intent and the relief sought. [72 Cust. Ct. at 262.]

See also, Grover Piston Ring Co., Inc. v. United States, 3 Fed. Cir. (T) 57, 58, 752 F. 2d 626 (1985), "The statute specifies that the protest must set forth each decision (liquidation) protested, each category of merchandise affected by each such decision, and the nature of each objection and reasons therefor" (emphasis in original), affirming 7 CIT 286 (1984), in which the Court stated: "The entry number, dates of entry and dates of liquidation are among other information required [in 19 CFR 174.13] to be set forth in a protest" (7 CIT at 287). Also, see Koike Aronson, Inc. v. United States, CIT LEXIS 134, CIT Slip Op. 97-130, September 16, 1997, in which a purported protest was found deficient because "[i]t did nothing more than identify the classification to which objection was made [and] did not identify any preferred alternative or give any details about the nature of the objection or the reasons for it." In this case, the Court reviewed cases in which a purported protest had been found sufficient and distinguished those cases on the basis that "[i]n all the aforementioned cases there was some information within the protest, either touching directly on the desired tariff treatment or linked to the fate of another claim that was reasonably calculated to direct the mind of Customs to the full nature of a specific claim."

The August 25, 1995, letter requests that Customs review the documents enclosed with the letter and send the importer a corrected invoice. The letter states that the imported merchandise was composed of "Green marble for fireplace $9,999.44 [and] Granite slabs $9,682.64 [for a total of] $19,682.08. The bill referred to in this letter is for $3,188.49 (principal) and $161.25 (interest), as stated in the August 18, 1995, reliquidation, and the bill date is August 18, 1995. The Notice of Action dated July 21, 1995, states that the "[c]orrect classification for serpentine slabs for fireplace sets is 7116.20.4000 @ 18.9%." Since the amounts stated in the August 25, 1995, letter are the same as the amounts stated in the invoice and entry, the letter could only be contesting the classification (i.e., contending that rather than being "serpentine slabs for fireplace sets", the imported merchandise consists of "[g]reen marble for fireplace [and] granite slabs"). In the documents enclosed with the letter, the importer stated the classification which it contended was correct. Customs understood the importer to be contesting the classification, in that the entry was again reliquidated (improperly; see above), with the fireplace surrounds classified under subheading 7116.20.40, HTSUS (consistent with Customs position at the time; see below), and the individual slabs under subheading 6802.91.05, HTSUS (if the slabs were actually of granite, the classification should have been under subheading 6802.93.00, HTSUS; if of serpentine, the classification should have been under subheading 6802.99.00; see below).

We conclude that the August 25, 1995, letter, with its enclosures, met the above criteria and is sufficient as a protest of the August 18, 1995, reliquidation. As stated above, based on the context and the documents submitted, the letter could only have been intended to contest the classification in the reliquidation (see Koike Aronson, supra, discussing CR Industries v. United States, 10 CIT 561 (1986), and recognizing the validity of reference to a previously communicated position to find that a protest was sufficient to fairly apprize Customs of the issue protested; to paraphrase from Koike Aronson, supra,"[i]n [this case] there was some information within the protest, either touching directly on the desired tariff treatment or linked to the fate of another claim that was reasonably calculated to direct the mind of Customs to the full nature of a specific claim"). Also as stated above, Customs appears to have understood the importer to have been contesting the classification. In this latter regard, we note that the Courts have stated that "... the fact that [Customs] under[stands] the protest would seem to be relevant" (Lothrop v. United States, 164 F. 99 (C.C. Mass. 1908)). To paraphrase the Court's statement in Mattel, supra, "however cryptic, inartistic, or poorly drawn[,]" the August 25, 1995, letter "convey[ed] enough information to apprise knowledgeable officials of the importer's intent and the relief sought" and, further, it contained each element of the information listed in 19 CFR 174.13 and Grover Piston (supra). As in the case of the October 20, 1995, liquidation, the protestant timely protested the August 18, 1995, reliquidation and, therefore, that reliquidation is voided and the protest is granted in this regard. Therefore, the May 19, 1995, liquidation stands as Customs final action on this entry and, since both purported reliquidations under 19 U.S.C. 1501 are void, the protest must be granted in full.

However, because of the confusion in this case (i.e., the untimely reliquidations and the different classifications of the merchandise), we will comment briefly on the classification issues in this case.

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.

The Harmonized Commodity Description And Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the ENs should always be consulted. See T.D. 89-80, published in the Federal Register August 23, 1989 (54 FR 35127, 35128).

In regard to the fireplace surrounds, at the time of the protested entry it was Customs position that unassembled fireplace surrounds of serpentine were classified as articles of semiprecious stone in subheading 7116.20.40, HTSUS. This position was based on Note 1(a), Chapter 71, HTSUS, under which, with certain exceptions, all articles consisting wholly or partly of semiprecious stones (natural, synthetic or reconstructed) are to be classified in Chapter 71; the Annex to the ENs for Section XIII, which lists serpentine as a semiprecious stone; and Note 1(d) Chapter 68, HTSUS, providing that Chapter 68 does not cover articles of Chapter 71. However, under 19 U.S.C. 1625(c)(1), Customs gave notice of a proposed modification of the rationale on which this position was based (see PROPOSED REVOCATION OF RULING LETTERS RELATING TO TARIFF CLASSIFICATION OF SOAPSTONE WOOD-BURNING STOVES published on March 19, 1997, in the Customs Bulletin). The ruling letters were modified as proposed (see REVOCATION OF RULING LETTERS RELATING TO TARIFF CLASSIFICATION OF SOAPSTONE WOOD-BURNING STOVES published on May 7, 1997, in the Customs Bulletin).

The modified ruling (HQ 960193, dated April 21, 1997; see also HQ 959493, dated April 21, 1997) held that unassembled wood-burning fireplaces, the exterior and interior of which are of soapstone (steatite), were classified in subheading 6802.99.00, HTSUS. The basis for this holding is that under Note 2, Chapter 68, HTSUS, the expression "worked monumental or building stone" for purposes of heading 6802 includes steatite, among other types of stone, and under EN 68.02 the expression is stated to cover stone which has been further processed than mere shaping into blocks, sheets or slabs by splitting, roughly cutting or squaring, or squaring by sawing (square or rectangular faces). Thus, the ruling found the merchandise to be described by heading 6802, as "worked monumental or building stone".

In applying the above to the merchandise in the protested entry, we note that the expression "worked monumental or building stone" for purposes of heading 6802 applies to the varieties of stone referred to in heading 2515 or 2516, among other types of natural stone (see Chapter 68, Note 2, HTSUS). Serpentine is one of the varieties of stone referred to in heading 2516 (see EN 25.16). Thus, heading 6802 provides, among other things, for worked monumental or building stone of serpentine. As in ruling HQ 960193, the fireplace surrounds have been further processed than mere shaping into blocks, sheets or slabs by splitting, roughly cutting or squaring, or squaring by sawing (see EN 68.02). Accordingly, the merchandise is described in heading 6802. The protestant contends that the merchandise, described by the protestant as being of "serpentine," should be classified under subheading 6802.91.05, HTSUS, as slabs of marble. Because geological serpentine is a different stone that geological marble, and because stones are classified based on their geological makeup, the serpentine stone articles in this case may not be classified under subheading 6802.91.05, HTSUS (see HRL 085266, dated September 9, 1989, and HQ 952679, dated January 26, 1993). The proper classification of the fireplace surrounds of serpentine stone in this case is subheading 6802.99.00, HTSUS.

As for the individual slabs, although they are invoiced as "granite" the protest describes all merchandise in the entry as "flat, rectangular slabs of serpentine stone finished on one side." Assuming that this is correct, the slabs are properly classified in subheading 6802.99.00, HTSUS. They are so classified whether consisting of individual slabs (see, e.g., ruling HQ 952679, dated January 26, 1993) or of unassembled serpentine fireplace surrounds (see above).

HOLDING:

(1) The reliquidations of the protested entry, the first reliquidation 91 days after initial liquidation and the second 154 days after the initial liquidation, are invalid and were voided because each reliquidation was timely protested. The initial liquidation is the "final and conclusive" decision by Customs regarding the protested entry, and the protest must therefore be granted. (2) Under the authority of GRI 1, the serpentine stone fireplace surrounds and individual slabs are provided for in heading 6802. They are classifiable in subheading 6802.99.00, HTSUS (although, because the reliquidations of the protested entry are voided, the initial liquidation of the protested entry is "final and conclusive").

The protest is GRANTED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed, with the Customs Form 19, by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act, and other public access channels.

Sincerely,

John Durant, Director,
Commercial Rulings Division