CLA-2 RR:TC:MM 960496 DWS
Mr. James Caffentzis
Fitch, King and Caffentzis
116 John Street
New York, NY 10038
RE: Reconsideration of 959101; Perforated Steel Strip Plated with
Heraeus-Amersil, Inc. v. U.S.; HQs 081606, 952938, and
Dear Mr. Caffentzis:
This is in response to your letter of January 2, 1997, on
behalf of Marubeni America Corporation, to the Director, National
Commodity Specialist Division of Customs, New York, requesting
reconsideration of HQ 959101, dated June 21, 1996, concerning the
classification of perforated steel strip plated with nickel under
the Harmonized tariff Schedule of the United States (HTSUS).
Your letter was referred to this office for a response.
The merchandise consists of a perforated, low carbon steel
strip which is plated with nickel. The strip, which you state is
dedicated for use in the production of negative electrodes for
nickel metal hydride batteries, will be imported into the U.S. in
coil form measuring approximately 486 mm in width. In its
condition as imported, the strip is perforated with a pattern of
holes to meet the specification and design of the particular
Upon receipt of the strip at the U.S. battery production
facility, the coil is mounted onto a coating machine. A metal
hydride alloy paste is introduced into a holding container on the
coating machine. The strip is passed through the coating
container and coated on both sides. After coating, the strip is
heated to remove water and rewound into a coil. The coil is then
slit into three smaller width rolls for handling purposes. The
slit rolls are sheared into smaller sections, depending upon the
battery size being assembled. They are then pressed and trimmed
to the actual size needed to make the negative electrode portion
of a nickel metal hydride battery.
Whether the steel strip is classifiable under subheading
7212.50.00, as a flat-rolled product of iron or nonalloy steel,
of a width of less than 600 mm, otherwise plated or coated, or
under subheading 8507.90.80, HTSUS, as a part of electric storage
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is in
accordance with the General Rules of Interpretation (GRI's).
GRI 1 provides that classification is determined according to the
terms of the headings and any relative section or chapter notes.
The subheadings under consideration are as follows:
7212.50.00: [f]lat-rolled products of iron or nonalloy
steel, of a width of less
than 600 mm, clad, plated or coated:
[o]therwise plated or coated.
The general, column one rate of duty for goods classifiable
provision is 4.6 percent ad valorem.
8507.90.80: [e]lectric storage batteries, including
separators therefor, whether
or not rectangular (including square); parts
thereof: [p]arts: [o]ther.
The general, column one rate of duty for goods classifiable
provision is 4.1 percent ad valorem.
In HQ 959101, we held that merchandise very similar to the
subject steel strip was classifiable under subheading 7212.50.00,
HTSUS. In that ruling we stated that the importer did not
provide "evidence that, as imported, the nickel plated perforated
steel strip in coil has the character of parts or components of
nickel cadmium batteries."
You cite several court decisions, including Heraeus-Amersil,
Inc. v. U.S., 10 CIT 258, 640 F.Supp. 1331 (1986), for the
proposition that, prior to importation into the U.S., the steel
strip has been manufactured to the point where it is recognizable
as the negative electrode of a battery and is classifiable under
subheading 8507.90.80, HTSUS. You state that the exact and tight specifications for the
perforations dedicate the product to a single use after
importation, and this factor should overcome the deficiency found
in HQ 959101.
In HQ 081606, dated August 10, 1988, which involved the
classification of perforated steel strip plated with nickel for
use in battery cans, we stated that:
[c]ourt cases on the classification of steel strip imported
in material lengths
indicate that to be classifiable other than as a material
the character and identity
of individual articles must be fixed with certainty at time
of importation. The
merchandise must be commercially and practically dedicated
to only one use,
with no additional post-importation processing required
except cutting to
The post-importation electromechanical processing represents
step in the manufacture of the article and is believed
critical to establishing
the character of the merchandise. The processing after
importation is not
mere cutting to length, such as was considered by the court
Amersil]. In that case, continuous lengths of metal contact
tape were merely
cut to length after first being welded to contact springs.
The court held that the
metal tape was classifiable as parts of electrical relays,
rather than as a material
(wire). The imported perforated strip in this case is
distinguishable because it is
processed beyond mere cutting to length. Therefore, the
perforated strip is not
classifiable as parts of batteries.
With regard to the subject steel strip, it is our
understanding that the post-importation coating process
represents a significant step in the manufacture of the negative
electrode and is critical in establishing its essential
character. The coating material and the steel strip function
together as a negative electrode. The coating is the active
material which stores energy or electrons; it provides energy to
the battery and the steel strip contributes to channeling the
energy from the battery to the device utilizing the battery. The
coil strip is not identifiable as a negative electrode until
after coating, and it is at this point in the processing that the
coated coil strip is slit into small widths and then sheared into
smaller sections needed to make the negative electrode portion of
Therefore, because it is our position that the steel strip,
in its condition as imported, does not possess the character of a
part of electric storage batteries, it is classifiable under
subheading 7212.50.00, HTSUS. See also HQ 952938, dated August
4, 1993, and HQ 956597, dated August 10, 1994.
The steel strip is classifiable under subheading 7212.50.00,
HTSUS, as a flat-rolled product of iron or nonalloy steel, of a
width of less than 600 mm, otherwise plated or coated.
EFFECT ON OTHER RULINGS:
HQ 959101 is affirmed.
John Durant, Director
Tariff Classification Appeals