CLA-2 CO:R:C:F 951239 ALS
Mr. Edward N. Glad
Glad and Ferguson
606 South Olive Street
Suite 1700
Los Angeles, California 90014
RE: Polyester/Epoxy Powder Coatings
Dear Mr. Glad:
This is in reference to your request of February 28, 1992,
for a binding ruling on the subject product. You state that you
disagree with the classification suggested by our Seattle import
specialist. We understand that several of your client's entries
covering the same merchandise are the subject of Protest No.
3001-92-1002732, dated March 16, 1992.
FACTS:
The products under consideration are powder coatings
composed of 45 to 55 percent by weight of polyester or epoxy
resin (or binder), curing agent, filler (or extender), pigments,
and additives. The coatings come in a variety of colors and may
be thermoplastic or thermosetting. They are used, in lieu of
liquid paint systems, to coat a variety of products.
ISSUE:
Are the products under consideration prepared pigments
classifiable under subheading 3207.10.0000, Harmonized Tariff
Schedule of the United States Annotated (HTSUSA), or as an
epoxy/polyester resin under subheading 3907.30.0000/3907.99.0050,
HTSUSA?
- 2 -
LAW AND ANALYSIS:
Classification of merchandise under the HTSUSA is governed
by the General Rules of Interpretation (GRI's) taken in order.
GRI 1 provides that the classification is determined first in
accordance with the terms of the heading and any relative section
and chapter notes. If GRI 1 fails to classify the goods and if
the heading and legal notes do not otherwise require, the
remaining GRI's are applied, taken in order.
Counsel states that the product which is used in a dry
painting process should be classified under subheading
3207.10.0000, HTSUSA, as a prepared pigment. Customs has
classified the product, in its polyester based form, under
subheading 3907.99.0050, HTSUSA.
Counsel has noted that subheading 3207.10.0000, HTSUSA, is
more specific than the subheading 3907.99.0050, HTSUSA; that the
product is more than a polyester resin, a different article of
commerce; and that the classification of the product is excluded
from Heading 3907 by Headnote 3 of Chapter 39, HTSUSA.
In considering this matter and the documentation submitted
by counsel, we note that there are at least 3 types of powder
coatings and that the primary component of each is a polyester or
epoxy resin or a combination of both, ranging from 45 to 55
percent by weight of each coatings components.
We consulted the Explanatory Notes (EN) to the Harmonized
System which represent the opinion of the international
classification experts in ascertaining the propriety of
classification of the products in Chapter 32 and 39 of the
Harmonized Tariff Schedule. EN 32.07 which contains the comments
for Heading 3207 specifies that prepared pigments, prepared
opacifiers and prepared colors of the ceramic industry are dry
mixtures formed by the heat treatment of oxides of antimony,
silver, arsenic, copper, chromium, cobalt, etc. or salts
(fluorides, phosphates, etc.) with or without fluxes or other
substances. It points out that the goods are fired at high
temperatures and that they are used to produce a colored or
opaque surface in the course of ceramic firing. It also points
out that the products may be incorporated in the glaze or enamel,
or be applied as a coating before glazing. There is no binder,
extenders, etc. The EN appears to only provide for inorganic
materials characteristic of the ceramic industry, i.e., a metal
oxide or pigment which is incorporated in the glaze or enamel.
- 3 -
Thus, Heading 3207 would not appear to cover the product under
consideration.
In considering the propriety of classification in Chapter
39, we note that EN 32.10(C)(c) specifies that powder paints
consisting principally of plastics and containing additives and
pigments, used for application to objects by the effect of heat
with or without application of static electricity are
classifiable in Chapter 39.
The subject powder coatings, which consist in part of
synthetic polymers with an average of at least 5 monomer units,
would fall under the provisions of Note 3(c) of Chapter 39.
Although counsel states that the product under consideration is
not produced by chemical synthesis and, therefore, would not be
covered by such provision, we note that the polymers, which are
the basic ingredient for the product, were created by chemical
synthesis. We also note that the product, a powder, meets the
definition of the term primary form in Heading 3907, HTSUSA,
pursuant to note 6(b) of Chapter 39. This is confirmed in
paragraph (2) of the primary forms portion of the General EN's to
Chapter 39, which specifies that such powders may be used to coat
objects by the application of heat with or without electricity.
Accordingly, we believe that the classification of the
subject products, whether their primary component is polyester,
epoxy or a combination thereof, under the provisions for resins
in Chapter 39 is appropriate. Those products which contain a
polymer blend would, pursuant to Note 4 of Chapter 39, be
classified under the heading or subheading covering the polymer
which predominates by weight over every other polymer.
HOLDING:
Powder coatings composed of 45 to 55 percent polyester or
epoxy resin (or binder), curing agent, filler (or extender),
pigments, and additives are classifiable in Chapter 39, HTSUSA.
If the resin composition of the powder coating is solely of
polyester, the product is classifiable under subheading
3907.99.0050, HTSUSA, and subject to a general rate of duty of
3.1 plus 9 percent ad valorem. If the resin composition of the
powder coating is solely of epoxy, the product is classifiable
under 3907.30.0000, HTSUSA, and subject to a general rate of duty
of 6.1 percent ad valorem. If the resin composition of the
powder coating is a combination of polyester and epoxy, the
- 4 -
product is classifiable under subheading 3907.30.0000 or
3907.99.0050, HTSUSA, based on the resin which predominates by
weight over every other resin, and would be subject to the
general rate of duty applicable to that subheading.
Sincerely,
John Durant, Director
Commercial Rulings Division