CLA-2 OT:RR:CTF:TCM H062208 CkG

TARIFF NO: 2833.25.00

Port Director
Customs and Border Protection
526 Water Street - Room 301
Port Huron, MI 48060-5471

Re: Request for Internal Advice on the classification of copper sulfate

Dear Port Director,

This letter is in reply to your request for internal advice, initiated by counsel on behalf of Pestell Minerals and Ingredients, sent May 1, 2009, pertaining to the classification of copper sulfate pentahydrate under the HTSUS and the denial of retrospective NAFTA preferential duty treatment to the subject merchandise.

FACTS:

The imported substance consists of copper sulfate pentahydrate, mixed with an anti-caking agent. The copper sulfate pentahydrate is crushed, screened and packed in 50 pound bags. Pestell claims the finished product is graded for use based on size (35, 40 or 100 grade). The packings identify the product as “Copper Sulfate”. Pestell claims the product is primarily used as a therapeutic animal feed ingredient to treat and/or prevent ailments resulting from copper deficiency, and is primarily sold to feed and farm supply retail outlets, feed manufacturers, and animal health distributors.

You issued a negative NAFTA origin determination to Pestell on Sept. 24, 2007. 

ISSUE:

Whether copper sulfate is classified in heading 2833, HTSUS, as a sulfate of copper, or in heading 3004, HTSUS, as a medicament for therapeutic or prophylactic uses, put up for retail sale.

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 provides that classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to the remaining GRIs 2 through 6.

The HTSUS provisions under consideration are as follows:

2833: Sulfates; alums; peroxosulfates (persulfates):

Other sulfates:

2833.25.00: Of copper….

* * * * * 3004: Medicaments (excluding goods of heading 3002, 3005 or 3006) consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses (including those in the form of transdermal administration systems) or in forms or packings for retail sale:

3004.90: Other:

3004.90.91: Other….

* * * * * Section VI, Note 2, HTSUS, provides as follows:

Subject to note 1 above, goods classifiable in heading 3004, 3005, 3006, 3212, 3303, 3304, 3305, 3306, 3307, 3506, 3707 or 3808 by reason of being put up in measured doses or for retail sale are to be classified in those headings and in no other heading of the tariff schedule.

* * * * * Chapter 30, Note 1, HTSUS, states, in pertinent part, as follows:

This chapter does not cover:

Foods or beverages (such as dietetic, diabetic or fortified foods, food supplements, tonic beverages and mineral waters), other than nutritional preparations for intravenous administration (section IV);

* * * * * The Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989). EN 30.04 further clarifies the scope of heading 3004, HTSUS:

This heading covers medicaments consisting of mixed or unmixed products, provided they are :

b)  In packings for retail sale for therapeutic or prophylactic use. This refers to products (for example, sodium bicarbonate and tamarind powder) which, because of their packing and, in particular, the presence of appropriate indications (statement of disease or condition for which they are to be used, method of use or application, statement of dose, etc.) are clearly intended for sale directly to users (private persons, hospitals, etc.) without repacking, for the above purposes.   These indications (in any language) may be given by label, literature or otherwise… Medicaments consisting of mixed products for therapeutic or prophylactic uses and not put up in measured doses or in forms or packings for retail sale are classified in heading 30.03 (see the corresponding Explanatory Note)… Further, this heading excludes food supplements containing vitamins or mineral salts which are put up for the purpose of maintaining health or well-being but have no indication as to use for the prevention or treatment of any disease or ailment. These products which are usually in liquid form but may also be put up in powder or tablet form, are generally classified in heading 21.06 or Chapter 22. * * * * * Classification

Pestell claims classification of the subject merchandise in heading 3004, HTSUS, as a medicament put up for retail sale for veterinary use. Pestell does not dispute that the merchandise is prima facie classifiable in heading 2833, as a sulfate of copper. However, Pestell argues that Note 2 to Section VI, HTSUS, requires that goods classifiable in heading 3004, HTSUS, be classified in that heading alone. Therefore if the copper sulfate at issue is classifiable in heading 3004, HTSUS, it cannot be classified in heading 2833, HTSUS.

Heading 3004, HTSUS, is a principal use provision. Classification under such a provision is controlled by the principal use of goods of that class or kind to which the imported goods belong in the United States at or immediately prior to the date of the importation. A tariff classification controlled by use, other than actual use, is to be determined by the principal use in the United States at, or immediately prior to, the date of importation, of goods of the same class or kind of merchandise. See Additional U.S. Rule of Interpretation 1(a). In other words, the actual use of the specific product at issue is not controlling. In determining the principal use of a product, CBP considers a variety of factors including general physical characteristics, the expectation of the ultimate purchaser, channels of trade, and the environment of sale (accompanying accessories, manner of advertisement and display). See United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F.2d 373 (1976), cert. denied, 429 U.S. 979. The importer contends that its product is principally used as a medicament of heading 3004, HTSUS. However, copper sulfate has many common uses aside from the importer’s suggested use as a feed ingredient for livestock. For instance, it is used in hair dyes, coloring glass, as a fungicide, and in the processing of leather and textiles. See http://www.hbci.com/~wenonah/hydro/cuso.htm.

The physical characteristics of the product as imported do not appear specialized for any specific use.

No information regarding the manner of advertisement and display of Pestell’s copper sulfate was provided. Counsel states, however, that Pestell’s copper sulfate is primarily sold to feed and farm supply retail outlets, feed manufacturers, and animal health distributors.

We find no evidence that copper sulfate in general is principally sold, advertised, or marketed for therapeutic use in animal feed as opposed to any other use. In fact, copper sulfate is also commonly advertised on sites such as amazon.com and nextag.com as a fungicide for control of algae in bodies of water and fish tanks. See e.g., http://www.nextag.com/All--zzcopper+sulfatez1zBiz5---html. Furthermore, the Copper Development Association describes the principal use of copper sulfate as a fungicide. See http://www.copper.org/applications/compounds/ copper_sulfate01.html . The Copper Development Association describes itself as “the market development, engineering and information services arm of the copper industry, chartered to enhance and expand markets for copper and its alloys in North America.” http://www.copper.org/ about/homepage.html. Correction of copper deficiency in animals is also recognized as a key use of copper sulfate, but does not appear to be recognized in the trade as the principal use of this substance.

We are therefore not persuaded that copper sulfate is principally used as a medicament of heading 3004, HTSUS. Accordingly, it is classified in heading 2833, HTSUS.

Application of negative NAFTA determination

The importer further disputes the denial of retrospective NAFTA preferential duty treatment to the subject merchandise, citing 19 CFR § 181.76, which provides, in pertinent part, as follows:

§ 181.76 Application of origin determinations. (b) Negative origin determinations. In the case of a negative origin determination issued under § 181.75(b) of this part: (1) The date on which preferential tariff treatment may be denied shall be no earlier than 30 calendar days from the date on which:

(i) Receipt of the written determination by the exporter or producer is confirmed, if a request under § 181.75(b)(1) of this part has been made; or (ii) The written determination is sent by Customs, if no request under § 181.75(b)(1) of this part has been made.

The 30-day period provided for in 19 CFR § 181.76 affords an opportunity for the importer to provide any comment or additional information to be provided that would substantiate the claim of NAFTA eligibility. It does not require that the effective date of verification apply only to prospective entries. Rather, the effective date of the verification applies to all entries subject to the verification. A finding otherwise would render the NAFTA verification process meaningless. Such a finding would prevent CBP from reliquidating entries that were the subject of the verification. See HQ W966139. dated December 22, 2008.

HOLDING:

By application of GRI 1, the copper sulfate at issue is classified in heading 2833, HTSUS, specifically subheading 2833.25.00, HTSUS, which provides for “Sulfates; alums; peroxosulfates (persulfates): Of copper.” The 2009 column one, general rate of duty is 1.4% ad valorem.

You are to mail this decision to the internal advice requester no later than 60 days from the date of the decision. At that time, the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.


Sincerely,

Myles B. Harmon, Director,
Commercial and Trade Facilitation Division