HQ 961659

JANUARY 20,1999

CLA-2 RR:CR:GC 961659 JAS

Port Director of Customs
P.O. Box 1490
St. Albans, VT 05478

RE: PRD 0201-98-100009; Titanium Solids; Bulk Weldable Scrap Titanium; Waste and Scrap, Subheading 8108.10.10; Billets, Unwrought Titanium; Bars, Other Titanium, Subheading 8108.90.60; Remelt Scrap; Consolidated Cork v.U.S.; Heading 9817, Articles of Metal to be Used in Remanufacture, 19 CFR 54.6; HQ 960800

Dear Port Director:

This is our decision on Protest 0201-98-100009, filed against your classification under the Harmonized Tariff Schedule of the United States (HTSUS) of certain titanium solids. The entry was liquidated on December 5, 1997, and this protest timely filed on March 4, 1998. Counsel for the protestant made supplemental submissions, dated August 25 and August 27, 1998, in which he presented additional materials.

FACTS:

The merchandise in issue is invoiced as 90/6/4 B/W scrap for remelt, 90/6/4 filler scrap for remelt, 95/5 B/W plate scrap for remelt and BT1-0 B/W scrap for remelt. These designations identify bulk weldable titanium, 90-95% by weight pure, with either 5 or 6% aluminum and 4% vanadium, as indicated. The designation BT1-0 is actually BT-10, which identifies a commercially pure Russian alloy that does not meet domestic specifications for commercially pure titanium. The merchandise is imported in 55-gallon drums. Customs Laboratory Report 3-97-20331-001, dated May 6, 1997, with respect to an entry your office indicates is identical to the one under protest, identifies a section of a bar or billet having a cross-sectional dimension of 13.5 centimeters x 13.5 centimeters, containing chiefly titanium and small amounts of iron, chromium and aluminum. - 2 -

The titanium was entered under a duty-free provision in HTS heading 8108, titanium waste and scrap. Your office determined that the referenced laboratory report did not support the waste and scrap claim, and liquidated the entry under the appropriate provision in heading 8108 for other titanium. Counsel contends that the waste and scrap classification is correct because the merchandise is cracked, and has exfoliated ends and piping. Because of breakage, cutting-up and wear, it is suitable only for remanufacture. In the alternative, counsel claims the merchandise is eligible for duty-free entry under subheading 9817.00.90, HTSUS, as remelt scrap to be used in remanufacture.

The provisions under consideration are as follows:

8108 Titanium and articles thereof, including waste and scrap:

8108.10 Unwrought titanium; waste and scrap; powders:

8108.10.10 Waste and scrap

8108.10.50 Other

8108.90 Other:

8108.90.60 Other

* * * *

Unwrought metal including remelt scrap ingot...in the form of ingots...which are defective or damaged, or have been produced from melted down metal waste and scrap for convenience in handling and transportation without sweetening, alloying, fluxing or deliberate purifying, and which cannot be commercially used without remanufacture...; Relaying or rerolling rails; articles of metal (...not including unwrought metal provided for in chapters 72-81) to be used in remanufacture by melting...: 9817.00.90 Other

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ISSUE:

Whether the titanium under protest qualifies as any of the types of goods described in heading 9817.

LAW AND ANALYSIS:

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. Initially, Section XV, Note 8(a), HTSUS, defines Waste and scrap as metal waste and scrap from the manufacture or mechanical working of metals, and metal goods definitely not usable as such because of breakage, cutting-up, wear or other reasons. Also, for purposes of chapters 72 through 83, Section XV, Additional U.S. Note 1, HTSUS, defines the term “unwrought” as refer[ring] to metal, whether or not refined, in the form of ingots, among other similar manufactured primary forms, but [the term] does not cover rolled, forged, drawn or extruded products, tubular products or cast or sintered forms which have been machined or processed otherwise than by simple trimming, scalping or descaling.

The evidence of record does not support the claim that the merchandise qualifies as waste and scrap. On the contrary, the referenced laboratory report identifies the merchandise as bar or billet without further elaboration as to its condition. Customs laboratory reports and their methods of weighing, measuring and testing merchandise are presumed to be correct. See Consolidated Cork v. United States, 54 Cust. Ct. 2512 (1965), HQ 950929, dated March 31, 1992, and related cases.

Counsel’s alternative claim under heading 9817 is based on Chapter 98, U.S. Note 1, HTSUS. Under this provision, even if the merchandise is classifiable as other titanium of heading 8108, as liquidated, or is classifiable elsewhere in chapters 1 through 97, if it is an article described in any provision in chapter 98 it is classifiable in said provision if the conditions and requirements thereof and of any applicable regulations are met. - 4 -

Subheading 9817.00.90 describes three types of goods:

(1) Unwrought metal including remelt scrap ingot (except copper, lead, zinc and tungsten) in the form of pigs, ingots, or billets

(a) which are defective or damaged, or have been produced from melted down metal waste and scrap for convenience in handling and transportation without sweetening, alloying, fluxing or deliberate purifying, and

(b) which cannot be commercially used without remanufacture;

(2) relaying or rerolling rails; and,

(3) articles of metal (except articles of lead, or zinc or of tungsten, and not including metal-bearing materials provided for in section VI, chapter 26 or subheading 8548.10 and not including unwrought metal provided for in chapters 72-81) to be used in remanufacture by melting or to be processed by shredding, shearing, compacting, or similar processing which renders the fit only for the recovery of the metal content.

As to type (1), bars are hot-rolled from billets; moreover, technical information available to us indicates that to get the required microstructure and tensile strength titanium billets are most always forged. See HQ 960800, dated November 17, 1998. Rolled or forged products are not unwrought for tariff purposes. The articles under protest are clearly not type (2) relaying or rerolling rails.

The titanium billets and bars do, however, qualify as type (3) articles predominating by weight of metal to be used in remanufacture by melting, provided there is satisfactory compliance with section 54.6, Customs Regulations (19 CFR 54.6). Among the documents in the protest file are a Declaration of Intent to subject the merchandise in the protested entry to a process of remanufacture by remelting, and two Statements of Actual Use, one for 90/6/4 B/W scrap for remelt and the other for 95/5 B/W plate scrap for remelt. Both relate to merchandise in the protested entry. However, there is no such Statement for merchandise identified as BT1-0 or BT-10 B/W scrap for remelt.

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HOLDING:

The titanium billets and bars in issue are provided for in heading 9817. They are classifiable in subheading 9817.00.90, HTSUS, provided that within the time allowed the protestant or his counsel submits the required end use certificate covering the BT1-0 or BT-10 B/W scrap for remelt, and provided further there is otherwise full compliance with 19 CFR 54.6.

The protest should be ALLOWED on the conditions stated above. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means the Freedom of Information Act, and other methods of public distribution.


Sincerely,

John Durant, Director
Commercial Rulings Division