CLA-2 OT:RR:CTF:TCM H027436 HkP
Mr. Paul Aberly
The Aberly Group
7934 North 54th Place
Paradise Valley, AZ 85253
RE: Revocation of HQ 966570; forged titanium billets; Additional U.S. Note 1 to Section XV
Dear Mr. Aberly:
This is in reference to Headquarters Ruling Letter (“HQ”) 966570, issued to you on November 7, 2003, in which the tariff classification of forged titanium billets was determined under the Harmonized Tariff Schedule of the United States (“HTSUS”). Through HQ 966570, U.S. Customs and Border Protection (“CBP”) revoked New York Ruling Letter (“NY”) A84786, dated July 12, 1996, and classified the titanium billets under subheading 8108.90.60, HTSUS, as “other” titanium and articles thereof. We have reconsidered HQ 966570 and determined that the tariff classification of the articles described therein is not correct. For the reasons set forth below, we hereby revoke HQ 966570.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. §1625(c)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed revocation was published on February 5, 2009, in the Customs Bulletin, Volume 43, No. 7. One importer contacted CBP in response to the notice regarding the proposed revocation’s impact on a ruling issued to the importer by CBP but did not submit comments on the proposed revocations.
FACTS:
The merchandise at issue was described in NY A84786 and HQ 966570 as being imported in billet form and thereafter to be melted down for use in the manufacture of recreational equipment. The chemical analysis of the product was stated to be 90 percent titanium, 6 percent aluminum, and 4 percent vanadium, by weight. The product was not further described.
In HQ 966570, CBP stated, in relevant part, the following:
According to Section XV, Additional U.S. Note 1, HTSUS, the term “unwrought” includes billets, among other similar manufactured primary forms of metal, but does not cover rolled or forged products, among others. Technical sources on titanium production we have consulted indicate that titanium ore is first chlorinated, then reacted with either magnesium or sodium to yield metallic titanium sponge. The sponge is crushed and pressed, then melted in a vacuum arc furnace. The melted sponge solidifies under the vacuum conditions of the furnace to form a solid titanium ingot which is then forged into either slabs or billets. Additionally, the term billet is defined as a semifinished section that is hot rolled from a metal ingot…, (2) a solid semifinished round or square product that has been hot worked by forging, rolling, or extrusion. Metals Handbook, Desk Edition, 2nd (1998), published by the American Society for Metals. As it appears that the titanium billets at issue here are produced by hot rolling or forging, they are not unwrought products for tariff purposes, and cannot be classified as unwrought titanium, in subheading 8108.20.00, HTSUS.
These statements no longer reflect our view on the classification of the forged titanium billets described in HQ 966570.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs, 2 through 6, may then be applied in order.
GRI 6 provides that the classification of goods in the subheading of a heading shall be determined according to the terms of those subheadings on the understanding that only subheadings at the same level are comparable.
The HTSUS provisions under consideration are as follows:
8108 Titanium and articles thereof, including waste and scrap:
8108.20 Unwrought titanium; powders …..
* * *
8108.20.0091 Other …..
8108.90 Other:
* * *
8108.90.60 Other …..
Additional U.S. Note 1 to Section XV, HTSUS, in which chapter 81 is located, provides:
For the purposes of this section, the term “unwrought” refers to metal, whether or not refined, in the form of ingots, blocks, lumps, billets, cakes, slabs, pigs, cathodes, anodes, briquettes, cubes, sticks, grains, sponge, pellets, flattened pellets, rounds, rondelles, shot and similar manufactured primary forms, but 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.
In construing the provisions of this Note, the Court of International Trade has found that:
The definition of unwrought contained in Additional U.S. Note 2 [now Note 1] connotes a stage in a manufacturing process which eventually results in a different ultimate product. The Court concludes that the phrase “manufactured primary forms” refers to forms that have undergone some processing but must undergo further processing before they appear in an eventual final product. This definition provides a unifying characteristic for the otherwise disparate enumerated forms.
Anval Nyby Powder AB v United States, 20 Ct. Int’l Trade 608, 616; 927 F. Supp. 463, 471 (citations omitted) (1996). Based on this interpretation by the court, it is evident that the language of Additional U.S. Note 2 to Section XV, HTSUS, also reflects the common and commercial meaning of the term “unwrought.” Furthermore, it is clear from the statements of the court that the term “unwrought” is in no way tied to a particular manufacturing process (such as hot rolling or forging). Rather, it refers to a product at an intermediate stage of a manufacturing process.
Other sources support this interpretation of “unwrought”. International Standard ISO 3134/2, Light metals and their alloys – Terms and definitions – Part 2: Unwrought products explains that the term “unwrought product” is a “[g]eneral term for products obtained by smelting or refining or casting processes, for example, ingots for rolling, ingots for extruding, ingots for forging and ingots for remelting.” Id. at 2.1. The Oxford English Dictionary defines the term “unwrought” in relevant part, as follows: “2. Not formed or fashioned by being worked on; esp. of materials (as fabrics, stone, or metals): Still in a crude, raw, rude, or natural state; not worked into a finished condition.”
Based on the above meanings of “unwrought”, we find that subheading 8108.20, HTSUS, provides for, without limitation, titanium that has not been worked into a finished condition. Accordingly, we find that the titanium billets are classified under subheading 8108.20, HTSUS, as “unwrought titanium” because they have not been worked into a finished condition.
HOLDING:
By application of GRI 1 through the provisions of GRI 6, the titanium billets are correctly classified under heading 8108, HTSUS. They are specifically provided for in subheading 8108.20, HTSUS, which provides for: “Titanium and articles thereof, including waste and scrap: Unwrought titanium; powders.” The 2008 column one, general rate of duty is 15%.
EFFECT ON OTHER RULINGS:
HQ 966570, dated November 7, 2003, is hereby revoked.
In accordance with 19 U.S.C. §1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division