CLA-2 RR:CR:GC 965435 AM
Mr. Kenneth G. Weigel
Mr. David P. Sanders
Kirkland & Ellis
655 Fifteenth Street, N.W.
Washington, D.C. 20005
Re: NY 850109: Desmodur IL
Dear Mr. Weigel and Mr. Sanders:
This is in reference to New York Ruling Letter (NY) 850109, issued to Mobay Corporation, by Customs National Commodity Specialist Division, New York, on May 1, 1990, concerning the classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of Desmodur IL. We have reviewed the decision in NY 850109, and have determined that the classification set forth therein, is in error. This ruling revokes NY 850109.
In your electronic message of March 27, 2002, you state that "Mobay was merged out of existence in Miles, Inc., which was then merged out of existence into Bayer Corp." We are therefore addressing this ruling to you as counsel for Bayer Corporation.
Pursuant to section 625(c)(1) Tariff Act of 1930 (19 U.S.C. 1625(c)(1)) as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, (Pub. L. 103-82, 107 Stat. 2057, 2186), notice of the proposed revocation of NY 850109 was published on April 17, 2002, in the CUSTOMS BULLETIN, Volume 36, Number 16. No comments were received in response to this notice.
FACTS:
Desmodur IL is formed by the condensation of diisocyanates. It is described in NY 850109 as an aromatic polyisocyanate based on polymeric toluene diisocyanate (TDI) dissolved in butyl acetate. The average number of repeating monomer units is seven. After importation, Desmodur IL is reacted with either a polyether or a polyester polyol to form polyurethane coatings for wood, metal and paper substrates.
Customs Laboratory Report 2-1990-30613 dated April 3, 1990, states “[T]he sample, a clear colorless liquid, is a solution of 1,3,5-bis(3-isocyanato-4-methylphenyl)-2,4,6-triazine(1H,3H,5H)-trione (56% by weight) in an organic solvent (butyl acetate). According to information received, Desmodur IL can be combined with polyesters to formulate fast drying 2 component polyurethane coatings. In our opinion, the sample is a prepolymer for polyurethane resins.”
In NY 850109, Customs classified the merchandise in subheading 3909.30.00, HTSUS, which provides for "[A]mino-resins, phenolic resins and polyurethanes, in primary forms: [O]ther amino-resins."
ISSUE:
What is the classification of Desmodur IL under the HTSUS?
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context that requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any related section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and mutatis mutandis, to the GRIs.
In interpreting the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, although not dispositive or legally binding, provide a commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. See T.D. 89 80, 54 Fed. Reg. 35127 (August 23, 1989).
The following HTSUS provisions are under consideration:
3909 Amino-resins, phenolic resins and polyurethanes, in primary forms:
3909.30.00 Other amino-resins
* * * * * * * * * * * *
3911: Petroleum resins, coumarone-indene resins, polyterpenes, polysulfides, polysulfones and other products specified in note 3 to this chapter, not elsewhere specified or included, in primary forms:
3911.90 Other: [than Petroleum resins, coumarone, indene or coumarone-indene resins; polyterpenes]
Other: [than elastomeric]
Containing monomer units which are aromatic or modified aromatic, or which are obtained derived or manufactured in whole or in part therefrom:
Thermosetting:
3911.90.45 Other: [than 1,1'-Bis(methylenedi-4,1-phenylene)-1H-pyrrole-2,5-dione, copolymer with 4,4'-methylenebis(benzeneamine); and Hydrocarbon novolac cyanate ester]
Chapter 39, note 3, HTSUS,states the following:
Headings 3901 to 3911 apply only to goods of a kind produced by chemical synthesis, falling in the following categories:
(a) Liquid synthetic polyolefins of which less than 60 percent by volume distills at 300°C, after conversion to 1,013 millibars when a reduced-pressure distillation method is used (headings 3901 and 3902);
(b) Resins, not highly polymerized, of the coumarone-indene type (heading 3911);
(c) Other synthetic polymers with an average of at least five monomer units;
Silicones (heading 3910);
Resols (heading 3909) and other prepolymers.
EN 39.09 states, in pertinent part, the following:
This heading covers:
(1) Amino-resins
These are formed by the condensation of amines or amides with aldehydes (formaldehyde, furfuraldehyde, etc.). The most important are urea resins (for example, urea-formaldehyde), thiourea resins (for example, thiourea-formaldehyde), melamine resins (for example, melamine-formaldehyde) and aniline resins (for example, aniline-formaldehyde).
* * * * * * *
Polyamine resins, such as poly(ethyleneamines), are not amino-resins and fall in heading 39.11 when complying with the requirements of Note 3 to this Chapter.
* * * * * *
(3) Polyurethanes
This class includes all polymers produced by the reaction of polyfunctional isocyanates with polyhydroxy compounds, such as, castor oil, butane-1,4-diol, polyether polyols, polyester polyols. Polyurethanes exist in various forms, of which the most important are the foams, elastomers, and coatings. They are also used as adhesives, moulding compounds and fibres.
Desmodur IL is not an amino resin formed by the condensation of amines or amides with aldehydes. The repeating unit portion of Desmodur IL is polymerized by isocyanate groups. Subheading 3909.50.50, HTSUS, provides for other polyurethanes. Polyurethanes include all polymers produced by the reaction of polyfunctional isocyanates with polyhydroxy compounds. Only after importation will the product, a polyfunctional isocyanate, be reacted with a polyether or polyol to form polyurethane. Desmodur IL as imported is a prepolymer for making polyurethane resins and is not a polyurethane. Chapter 39, Note 3(e) specifies that resols are classified in heading 3909, HTSUS, but that other prepolymers may be classified in headings 3901 through 3911, HTSUS. Desmodur IL is not a resol. Hence, Desmodur IL is a product specified in note 3 to chapter 39 as a prepolymer and by the terms of those headings, falls to be classified in heading 3911, HTSUS.
HOLDING:
Desmodur IL is classified in subheading 3911.90.45, HTSUS, the provision for “[P]etroleum resins, coumarone-indene resins, polyterpenes, polysulfides, polysulfones and other products specified in note 3 to this chapter, not elsewhere specified or included, in primary forms: [O]ther: [O]ther: [C]ontaining monomer units which are aromatic or modified aromatic, or which are obtained derived or manufactured in whole or in part therefrom: [T]hermosetting: [O]ther.”
EFFECT ON OTHER RULINGS:
NY 850109, dated May 1, 1990, is revoked.
In accordance with 19 U.S.C. §1625(c)(1), this ruling will become effective 60 days after its publication in the CUSTOMS BULLETIN.
Sincerely,
John Durant, Director
Commercial Rulings Division