CLA-2 OT:RR:CTF:TCM H244156 ALS
Port Director
U.S. Customs and Border Protection
200 East Bay Street
Charleston, South Carolina 29401
RE: Internal Advice; Tariff Classification of Roll of Polyethylene Film
Dear Port Director:
This letter is in reply to your request for internal advice of February 8, 2013, initiated by counsel on behalf of Smilemakers, Inc., regarding the tariff classification of a roll of polyethylene film. Smilemakers has withdrawn its request and interest in this internal advice and a related Application for Further Review of a Protest. Your office maintains interest in our response to your request, however. Our decision is set forth below.
FACTS:
The article at issue is a roll of polyethylene film. The film is formed in Taiwan into a continuous sleeve or lay-flat tube in widths of seven or nine inches and length of 1,875 to 2,500 feet. It is then printed with various pictures and designs. Multiple rolls are imported in a box. Smilemakers specifically notes that “in their condition as imported, the rolls do not have any ‘handles.’” After importation, the roll is further manufactured by printing client-specific information on the roll, cut to size, heat sealed at one end to form a bag, and has holes cut out at the other end to form handles. The finished bags are sold to dental offices. Samples of the roll of polyethylene film, as imported, have been submitted.
Your office issued a Notice of Action to Smilemakers on January 16, 2013, in which you notified Smilemakers of your decision to re-classify rolls of polyethylene film from Harmonized Tariff Schedule of the United States (HTSUS) subheading 3920.10.00 to subheading 3923.21.00, HTSUS. Smilemakers had entered the rolls under subheading 3920.10.00, HTSUS. The re-classification resulted in a tariff rate advance from 4.2% to 36.54%, as the classification under 3923.21.0085 subjected the rolls to anti-dumping duties. In doing so, your office determined that the “essential character of the merchandise… is polyethylene retail carrier bags, which are subject to” antidumping duties.
Upon initiating this internal advice and before withdrawing its request, Smilemakers agreed the goods in issue were incorrectly classified under subheading 3920.10.0000, HTSUS. However, Smilemakers believes the goods are properly classified under heading 3917, HTSUS, and not heading 3923, HTSUS, in accordance with existing CBP (“Customs and Border Protection”) rulings.”
ISSUE:
Is the roll of polyethylene film, as described above, properly classified under HTSUS heading 3923, which provides for “Articles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closures, of plastics”, or under HTSUS heading 3917, which provides for “Tubes, pipes and hoses and fittings therefor (for example, joints, elbows, flanges), of plastics”?
LAW AND ANALYSIS:
Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRI”) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation (“ARI”). GRI 1 provides that the classification of goods shall be “determined according to the terms of the headings 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, GRIs 2 through 6 may be applied in order.
The following headings of the HTSUS are under consideration in this case:
3923 Articles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closures, of plastics
3917 Tubes, pipes and hoses and fittings therefor (for example, joints, elbows, flanges), of plastics
* * * * * * * * * * * *
There is no dispute that the roll of polyethylene film is an article of plastic that is classified under HTSUS Chapter 39. Note 8, Chapter 39, HTSUS, provides the following:
For the purposes of heading 3917, “the expression ‘tubes, pipes and hoses” means hollow products, whether semimanufactures or finished products, of a kind generally used for conveying, conducting or distributing gases or liquids (for example, ribbed garden hose, perforated tubes). This expression also includes sausage casings and other lay-flat tubing. However, except for the last mentioned, those having an internal cross section other than round, oval, rectangular (in which the length does not exceed 1.5 times the width) or in the shape of a regular polygon are not to be regarded as tubes, pipes and hoses, but as profile shapes.
CBP has ruled that lay-flat tubing composed of polyethylene sheeting imported in continuous rolls to be manufactured into packaging bags is classified under heading 3917. See CBP Ruling NY N103739 (May 24, 2010) and CBP Ruling NY N044663 (November 26, 2008). CBP Ruling NY A82056 (April 17, 1996) ruled that PVC shrink bands in the form of lay-flat tubing was ruled to be classified under heading 3917, HTSUS. NY A82056 determined that “[t]hose shrink bands in the form of lay flat tubing meet the definition of lay-flat tubing provided in legal note 8 of chapter 39 of the Harmonized Tariff System, and are therefore classified as lay-flat tubing in heading 3917.”
Your office states that “[i]t was decided, based on the essential character of the product, that the port of Charleston would change the classification for the plastic bags on rolls...” We take it from this statement that your office determined that the essential character of the roll of polyethylene film is that of an article for conveyance or packing of goods, of plastics, as provided for in HTSUS heading 3923.
It is well-settled that goods are to be classified according to their condition as imported. See Mita Copystar Am. v. United States, 21 F.3d 1079, 1082 (Fed. Cir. 1994); see also CBP Ruling HQ H197758 (April 27, 2012) and CBP Ruling HQ H224011 (November 5, 2013). In its condition as imported, the roll of polyethylene film does not bear any of the characteristics of an article of conveyance or packing of goods. The roll is hollow with openings on both ends, which of course precludes the carriage of any item inside of it. The roll has no handles of any kind, pre-formed or otherwise. The roll is also not sized to any particular shape that might suggest a suitability to carry certain items. In fact, it is only the knowledge that it will be eventually manufactured after importation into a bag for dental offices that such characteristics might even be inferred upon the imported roll of polyethylene film. We therefore find that the roll of polyethylene film, as imported, is not an article of conveyance or packing as provided for under HTSUS heading 3923.
Based on the foregoing, we find that the roll of polyethylene film is a tube of plastic as provided for under HTSUS heading 3917, in accordance with GRI 1, Note 8 of HTSUS Chapter 39, and the cited CBP rulings. As the roll of polyethylene film is not reinforced or otherwise combined with other materials and is without fittings, we determine that it is specifically classified under HTSUS subheading 3917.32.00, which provides for “Tubes, pipes and hoses and fittings therefor (for example, joints, elbows, flanges), of plastics: Other, not reinforced or otherwise combined with other materials, without fittings...”
HOLDING:
The subject roll of polyethylene film is properly classified, by virtue of GRI 1, under heading 3917, HTSUS. Specifically, it is classified under HTSUS subheading 3917.32.00, which provides for “Tubes, pipes and hoses and fittings therefor (for example, joints, elbows, flanges), of plastics: Other, not reinforced or otherwise combined with other materials, without fittings...” The general column one rate of duty, for merchandise classified in this subheading is 3.1%.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.
No later than 60 days from the date of the decision, 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