CLA-2 OT:RR:CTF:TCM H273388 NCD
Center Director
Center of Excellence and Expertise for Machinery
U.S. Customs and Border Protection
109 Shiloh Dr., Suite 300
Laredo, TX 78045
Attn: Juan Porras, Import Specialist
RE: Internal Advice Request; Classification of treated fumed silicas
Dear Port Director:
This is in response to a January 7, 2016 request by the Center of Excellence and Expertise for Machinery (“CEE”) for internal advice as to the proper classification of various treated fumed silica products under the Harmonized Tariff Schedule of the United States (HTSUS). The CEE submitted its request upon its receipt of a July 17, 2015 request by Xerox Corporation (“Xerox”) that the CEE seek internal advice from our office pursuant to 19 C.F.R. §177.11(b).
We note at the outset that merchandise identical to that at issue was previously classified by our office in Headquarters Ruling Letter (HQ) H233358, issued to the Port of Huron on December 13, 2013. In its July 17, 2015 request, Xerox asserts that the determination reached in HQ H233358 is incorrect, insofar as it does not account for novel arguments set forth in Xerox’s request, and that that decision should accordingly be reconsidered. As such, the below determination sets forth our position as to the arguments presented by Xerox, to the correctness of HQ H233358 in view of those arguments, and to the proper classification of the treated fumed silicas at issue in both HQ H233358 and the instant case.
FACTS:
The subject products, which are produced by various manufacturers, all consist of fumed (i.e., pyrogenic) silicas that have been chemically modified so as to increase their hydrophobicity, or resistance to “wetting” by water. Fumed silica (SiO2+4HCl) is a unique form of silicon dioxide that results from the reaction of the silicon tetrachloride (SiCl4) with hydrogen (2H2) and oxygen (O2). It is obtained by the pyrolysis of silicon tetrachloride in a hydrogen-oxygen flame, during which individual silicon dioxide particles collide and sinter together to form branch-like “aggregates” and, subsequently, longer chain-like entanglements of aggregates referred to as “agglomerates.”
Due to the presence of highly reactive silanol (SiOH) groups along the particles’ outer surfaces, agglomerates of silica particles have a tendency to bond to each other. Consequently, when dispersed in a non-polar liquid, which facilitates this bonding, the agglomerates form a three-dimensional structure that effectively thickens the liquid in which the fumed silica is dispersed. However, the thickening process can be reversed, and the flow of the liquid medium correspondingly increased, by the application of “shear” forces like stirring or mixing upon the liquid. This is because shear forces break down the three-dimensional agglomerated structures and reduce the component fumed silica particles to their aggregate structures. Fumed silica thus provides both viscosity-increasing and thixotropic applications when introduced to non-polar liquids, and accordingly functions as an effective rheology agent in such substances.
In contrast, it performs neither of these applications effectively when dispersed in polar liquids. This is because its particular surface chemistry renders it hydrophilic, or susceptible to “wetting,” in its natural state. Specifically, the surface silanol groups attract and bond with hydrogen atoms in surrounding polar media, rather than with each other. This in turn inhibits the capacity of the fumed silica aggregates to agglomerate into three-dimensional structures that impart thickening behavior. Therefore, when placed in a polar medium like water, fumed silica will not agglomerate and increase the viscosity of the medium.
Despite its natural hydrophilicity, silica can be chemically modified so as to impart it with hydrophobic properties. Chemical modification typically entails treatment of the fumed silica with organosilicon compounds, resulting in the deposition of hydrocarbon moieties on the silica aggregates’ outer surfaces. Once deposited, the hydrocarbon moieties bond with a portion of the surface silanol groups, in effect converting these to inert siloxane (SiO(CH3)2) groups. Unlike the silanol groups, the siloxane groups lack the propensity to bond with hydrogen molecules in surrounding media, and their presence consequently increases the hydrophobicity of the silica particles. Notably, however, silicas that have undergone this treatment retain at least some – i.e., 30 to 70 percent, according to Xerox – of their unreacted surface silanol groups. As such, while referred to commercially as hydrophobic fumed silica, they are not in fact wholly hydrophobic. In the instant case, the degree to which each of the subject treated fumed silicas have been modified is unknown.
ISSUE:
Whether the subject treated fumed silicas are properly classified in subheading 2811.22.50, HTSUS, as “other” silicon dioxide, in subheading 3824.90.39, HTSUS, as chemical preparations consisting of mixtures of two or more inorganic compounds, or in subheading 3824.90.92, HTSUS, as “other” chemical preparations.
LAW AND ANALYSIS:
Merchandise imported into the United States is classified under the HTSUSA. 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 which 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 for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule 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 heading and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied 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 GRIs 1 through 5.
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System, which constitute the official interpretation of the HTSUS at the international level, 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 2016 HTSUS provisions under consideration in the instant case are as follows:
2811 Other inorganic acids and other inorganic oxygen compounds of nonmetals:
2811.22 Other inorganic oxygen compounds of nonmetals:
Silicon dioxide:
2811.22.50 Other
3824 Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included:
3824.90 Other:
Other:
Mixtures of two or more inorganic compounds:
3824.90.39 Other
Other:
Other:
3824.90.92 Other
As a preliminary matter, if the subject treated fumed silicas are prima facie classifiable in heading 2811, HTSUS, they are precluded from classification in heading 3824, HTSUS. Chapter 28, Note 1, HTSUS (“Except where the context otherwise requires, the headings of this chapter apply only to…separate chemically defined organic compounds.”); Chapter 38, Note 1, HTSUS (“This chapter does not cover…separate chemically defined elements or compounds…”). Accordingly, we initially consider whether the subject fumed silicas are prima facie classifiable in heading 2811, HTSUS.
Heading 2811, HTSUS, provides, inter alia, for “other inorganic oxygen compounds of nonmetals.” Note 1 to Chapter 28 states, in pertinent part, as follows:
Except where the context otherwise requires, the headings of this Chapter apply only to:
Separate chemically defined inorganic compounds, whether or not containing impurities;
* * *
The products mentioned in (a), (b), or (c) above with an added stabilizer (including an anticaking agent) necessary for their preservation or transport…
The EN to Chapter 28 states, in pertinent part, as follows:
GENERAL
A separate chemically defined compound is a substance which consists of one molecular species (e.g., covalent or ionic) whose composition is defined by a constant ratio of elements and can be represented by a definitive structural diagram. In a crystal lattice, the molecular species corresponds to the repeating unit cell.
The elements of a separate chemically defined compound combine in a specific characteristic proportion determined by the valency and the bonding requirements of the individual atoms. The proportion of each element is constant and specific to each compound and it is therefore said to be stoichiometric.
Small deviations in the stoichiometric ratios can occur because of gaps or insertions in the crystal lattice. These compounds are described as quasi-stoichiometric and are permitted as separate chemically defined compounds provided that the deviations have not been intentionally created.
(A) Chemically defined elements and compounds.
(Note 1)
Separate chemical elements and separate chemically defined compounds containing impurities, or dissolved in water, remain classified in Chapter 28.
The term “impurities” applies exclusively to substances whose presence in the single chemical compound results solely and directly from the manufacturing process (including purification).
* * *
It should be noted, however, that such substances are not in all cases regarded as “impurities” permitted under Note 1(a). When such substances are deliberately left in the product with a view to rendering it particularly suitable for specific use rather than for general use, they are not regarded as permissible impurities.
Separate chemically defined elements and compounds as described above, put up with an added stabiliser necessary for their preservation or transport, remain classified in this Chapter. For example, hydrogen peroxide stabilised by addition of boric acid remains classified in heading 28.47; but sodium peroxide mixed with catalysts (for production of hydrogen peroxide) is excluded from Chapter 28 and is classified in heading 38.24.
Products added to certain chemicals to keep them in their original physical state are also to be regarded as stabilisers, provided that the quantity added in no case exceeds that necessary to achieve the desired result and that the addition does not alter the character of the basic product and render it particularly suitable for specific use rather than for general use. By application of these provisions anti-caking agents may be added to the products of this Chapter. Such products with added water-repellents are, on the other hand, excluded since such agents modify the original characteristics of the products.
Pursuant to Note 1 to Chapter 28, headings of the chapter apply both to separately defined compounds and to such compounds to which stabilizers necessary for the preservation or transport of the compounds have been added. As to the former, the EN to Chapter 28 defines “separately defined compound” as a substance in which the stoichiometric ratio of constituent elements is constant, and in which any impurities, in the form of deviations from this ratio, are not deliberately engineered. In Degussa II, the U.S. Court of Appeals for the Federal Circuit (C.A.F.C.) applied this definition to fumed silicas whose surfaces had been modified by the deposition of hydrocarbon moieties so as to increase the particles’ surface hydrophobicity. 508 F.3d at 1046; see also Degussa I, 452 F. Supp. 2d at 1314-15 (establishing that the silicas at issue had been produced by pyrolysis and the subsequent incorporation of hydrocarbon moieties). In so doing, the court ruled that because the hydrocarbon moieties rendered the silicon dioxide non-stoichiometric, and because their introduction was by deliberate design, they could not be considered impurities for purposes of Note 1(a) to Chapter 28. Degussa II, 508 F.3d at 1049-50. In effect, the court held, the silicon dioxide could not be described as a “separately defined inorganic compound” within the meaning of the note. Id. at 1050.
Here, like in Degussa, the subject merchandise consists of fumed silicas that have been treated through the intentional addition of hydrocarbon moieties to its particles’ outer surfaces. The introduction of the hydrocarbon moieties results in the alteration of the particles’ surface stoichiometry, insofar as the naturally-occurring silanol groups are replaced with siloxane groups. Because these alterations to the molecular structure are deliberate, the hydrophobic fumed silicas cannot be considered separately defined compounds. In fact, as we noted in HQ H233358, supra, the hydrophobic fumed silica is substantially similar, if not outright identical, to the modified silicon dioxide particles that the court deemed outside the scope of Note 1(a) in Degussa. Accordingly, in light of the court’s decision in that case, it is beyond dispute that the subject hydrophobic fumed silicas do not satisfy Note 1(a) to Chapter 28.
Xerox does not challenge the C.A.F.C.’s determination that the hydrocarbon moieties do not qualify as impurities within the meaning of Note 1(a). Rather, the crux of its argument is that the moieties constitute permissible stabilizers, as the C.A.F.C. failed to recognize, and that the subject treated fumed silicas therefore fall within the ambit of Note 1(d) to Chapter 28. As stated above, Note 1(d) applies to separate chemically defined compounds to which stabilizers necessary for preservation or transport have been added. The EN to Chapter 28 indicates that stabilizers within the meaning of Note 1(d) include additives designed to keep the compound in its original physical state, but do not include additives that alter the compound’s character and thereby render it particularly suitable for a specific use. In illustrating the distinction between permissible stabilizers and impermissible additives, the EN further provides that compounds to which water-repellants have been added are of the latter type because the addition modifies the original characteristics of the compound.
Here, the subject fumed silicas are supplemented with hydrocarbon moieties for the express purpose of increasing the silica particles’ hydrophobicity. Xerox asserts that this treatment is necessary to prevent absorption of atmospheric moisture that can severely diminish, or outright eliminate, their rheological applications. However, we have not located any sources, either in Xerox’s submission or in the course of our own research, indicating that this is even one of the objectives of the treatment.
Moreover, according to Degussa II, the addition of the hydrocarbon moieties alters the character of the fumed silica and renders it suitable for specific use. See 508 F.3d at 1048-49. Specifically, in addressing whether the moieties qualified as impurities, the court found that they impart on the silica a degree of water repellency that enables its incorporation into certain organic solvents and polymers. See id. Xerox acknowledges that the C.A.F.C. has addressed this issue, but contends that it erred in doing so because it mistakenly equated hydrophobicity, which denotes “wettability”, with water repellency. Because the two properties are not co-extensive, Xerox’s argument goes, hydrocarbon moieties that increase hydrophobicity cannot be characterized as water repellents. However, the court considered this purported distinction in Degussa II, and ultimately rejected it on the grounds that the manufacturer’s own product literature, some of which applies to the subject merchandise, indicates that treated fumed silica does in fact have water-resistant properties. The court’s finding is consistent with our own research, which indicates that hydrophobicity and water repellency are often equated or used interchangeably. See Richard J. Lewis, Sr., Hawley’s Condensed Chemical Dictionary 669 (15th ed. 2007) [hereinafter Hawley’s] (defining hydrophobic as “antagonistic to water”); David Chandler, “Explained: Hydrophobic and hydrophilic, Massachusetts Institute of Technology News, July 16, 2013, http://news.mit.edu/2013/hydrophobic-and-hydrophilic-explained-0716 (“Materials…that naturally repel water, causing droplets to form, are known as hydrophobic.”). In view of this, we find that the subject treated fumed silica has in fact been supplemented with water repellents within the meaning of the EN to Chapter 28, and that it consequently falls outside the scope of Note 1(d) to Chapter 28. See also HQ H233358, supra (reaching an identical conclusion).
Finally, even if water repellency could be considered a misnomer here, it is nonetheless clear that the fumed silica undergoes transformations in character and use upon deposition of the hydrocarbon moieties. As Xerox itself states, this step renders hydrophilic silica hydrophobic, thereby altering the fundamental nature of its reactivity to water and other polar liquids. Moreover, our review of myriad technical and commercial sources unequivocally indicates that while both hydrophilic fumed silicas and hydrophobic fumed silicas offer utility to purchasers, the applications of the former are wholly distinct from those of the latter. For example, left untreated, fumed silicas provide effective rheology control in non-polar liquids due to their aforementioned propensity to form three-dimensional “thickening” structures when dispersed in polar liquids, as well their susceptibility to “thinning” shear forces. See Fumed Silica Controls Rheology of Adhesives and Sealants, Adhesives & Sealants Indus., Oct. 5, 2000, http://www.adhesivesmag.com/articles/85787-fumed-silica-controls-rheology-of-adhesives-and-sealants [ASI]. As a result, they are particularly suitable for use as rheology agents in non-polar adhesives, coatings, sealants, and cosmetics, among other substances. See id. They are accordingly advertised and made available for purchase as such by various manufacturers. See, e.g., Cabot Corp., CAB-O-SIL® EH-5 Fumed Silica (2014).
In contrast, hydrophobic fumed silicas, while less efficient thickeners than untreated fumed silicas, lend advantageous flow and leveling properties and heightened water repellency and anti-corrosiveness to the substances to which they are incorporated. See Successful Use of Fumed Silica in Liquid Systems, Paint & Coatings Indus., Oct. 1, 2001, http://www.pcimag.com/articles/86041-successful-use-of-fumed-silica-in-liquid-systems; Cabot Corp., CAB-O-SIL® TS-610 Fumed Silica (2014). As such, they are specifically selected for use in cosmetics products and coatings in which those properties, as well as lower viscosities, are preferable. Evonik Indus., Successful use of AEROSIL® fumed silica in liquid systems: Technical Information 1279 (2015), https://www.aerosil.com/sites/lists/IM/Documents/TI-1279-Successful-use-of-AEROSIL-in-liquid-systems-EN.pdf. Additionally, whereas untreated fumed silicas are wholly ineffective in polar liquids, modified fumed silicas are able to form three-dimensional agglomerations, and thus provide thickening and thixotropic functionality, in such liquids. See Francisco J. Galindo-Rosales et. al., Shear-thickening behavior of Aerosil® R816 nanoparticles suspensions in polar organic liquids, 48 Rheologica Acta 700 (2009); ASI, supra, at 7. They are accordingly promoted and sold as rheology agents in, among other substances, polyurethane and epoxy adhesives and sealants. See, e.g., Evonik Indus., AEROSIL® for Adhesives and Sealants (2015) ; Cabot Corp., CAB-O-SIL® TS-530 Fumed Silica (2015); Cabot Corp., CAB-O-SIL® TS-720 Fumed Silica (2014). In sum, it is all but clear that treatment of the fumed silicas alters their character and renders them suitable for specific purposes.
Despite this, Xerox asserts that treatment of the hydrocarbon moieties as stabilizers is necessitated by the C.A.F.C.’s decision in Roche Vitamins, Inc. v. United States, 772 F.3d 728 (Fed. Cir. 2014). In that case, which was decided following our issuance of HQ H233358, supra, the court clarified the scope of the term “stabilizer” for classification purposes. In so doing, the court held that various substances present in the product BetaTab constituted permissible “stabilizers” because they formed a necessary stabilizing matrix for the active beta-carotene ingredient, did not alter beta-carotene’s functionality as a provitamin, and did not tailor or expand the range of BetaTab’s uses. Id. at 732-33. Xerox asserts that the additives in Roche are analogous to the hydrocarbon moieties added to the subject fumed silicas, and that the latter therefore merit treatment as “stabilizers.” However, as explained in detail above, the hydrocarbon moieties do in fact alter the thickening and thixotropic properties of the fumed silicas and impart them with a range of uses for which they are entirely insufficient when left untreated. Contrary to Xerox’s assertions, therefore, the BetaTab at issue in Roche is distinguishable from the subject merchandise. We accordingly affirm our determination in HQ H233358, supra, that the moieties cannot be described as stabilizers within the meaning of Note 1(d) to Chapter 28, and that the silicas to which they are added cannot be classified in heading 2811, HTSUS.
Having excluded the subject treated fumed silicas from heading 2811, we consider heading 3824, HTSUS, which provides, inter alia, for chemical products or preparations. Note 1 to Chapter 38 provides, in relevant part, as follows:
This chapter does not cover:
Separate chemically defined elements or compounds…
EN 28.24 states, in relevant part, as follows:
(B) CHEMICAL PRODUCTS AND CHEMICAL OR OTHER PREPARATIONS
With only three exceptions (see paragraphs (7), (19) and (32) below), this heading does not apply to separate chemically defined elements or compounds.
The chemical products classified here are therefore products whose composition is not chemically defined, whether they are obtained as by products of the manufacture of other substances (this applies, for example, to naphthenic acids) or prepared directly.
The chemical or other preparations are either mixtures (of which emulsions and dispersions are special forms) or occasionally solutions. Aqueous solutions of the chemical products of Chapter 28 or 29 remain classified within those Chapters, but solutions of these products in solvents other than water are, apart from a few exceptions, excluded therefrom and accordingly fall to be treated as preparations of this heading.
* * *
Subject to the above conditions, the preparations and chemical products falling here include:
* * *
(24) Compounded extenders for paints. These are prepared powders often added to paints (other than distempers) to reduce their cost and at the same time, in some cases, to improve certain properties (e.g., to facilitate the spreading of colouring pigments). They are also used in the manufacture of distempers, but in this case they act as pigments. These preparations consist of mixtures of two or more natural products (chalk, natural barium sulphate, slate, dolomite, natural magnesium carbonate, gypsum, asbestos, mica, talc, calcite, etc.), of mixtures of these natural products with chemical products, or of mixtures of chemical products (e.g., mixtures of aluminium hydroxide and barium sulphate).
This category also includes finely ground natural calcium carbonate (“Champagne white”), each particle being coated, by a special treatment, with a water repellent film of stearic acid.
As discussed above, treated fumed silicas cannot be described as “separate chemically defined compounds.” Moreover, as the C.A.F.C. held in Degussa II, treated silica is analogous to surface-modified calcium carbonate, which EN 38.24 lists as an exemplar of a product classifiable in heading 3824. 508 F.3d at 1050-51. In effect, the subject treated fumed silicas qualify as chemical products or preparations within the meaning of heading 3824, HTSUS, and are properly classified there. As Xerox concedes, this determination is supported by Degussa II. Id.; see also HQ H233358, supra.
Xerox contends, as an alternative to its claim for heading 2811, HTSUS, that if the treated fumed silicas are to be classified in heading 3824, HTSUS, then they are properly classified at the eight-digit subheading level in subheading 3824.90.39, HTSUS, which provides for “mixtures of two or more inorganic compounds.” The HTSUS does not set forth definitions of “organic” or “inorganic.” Undefined tariff terms are construed in accordance with their common meanings, which may be ascertained by reference to “standard lexicographic and scientific authorities,” as well as the pertinent ENs. GRK Can., Ltd. v. United States, 761 F.3d 1354, 1357 (Fed. Cir. 2014). According to technical sources, an organic compound denotes a compound whose molecules contain at least one carbon atom, whereas an inorganic compound refers to a compound in which carbon is absent. See Hawley’s, supra page 7, at 689, 928; Van Nostrand’s Encyclopedia of Chemistry 842, 1168 (Glenn D. Considine, ed., John Wiley & Sons, Inc. 5th ed. 2005).
Here, as discussed above, the subject treated fumed silicas have been partially modified insofar as some, but not all, of the silanol groups on the silica particles’ exterior surfaces have been reacted and replaced. According to Xerox, the subject fumed silicas consequently constitute mixtures of modified silica molecules and pure silicon dioxide. However, even if the silicas can be considered mixtures of two different types of compounds, the introduction of the hydrocarbon moieties, which contain carbon atoms, renders them, at most, mixtures of organic and inorganic compounds. As such, they do not fall within the ambit of subheading 3824.90.39, HTSUS.
Xerox contends that “treatment with organosilanes does not transform the treated silica into an organic chemical compound,” and, essentially, that the carbon is so minimal in molecular weight, i.e., between 0.45 and 6 percent, as to qualify as de minimis. We do not contest that the subject hydrophobic fumed silicas do not qualify as wholly organic compounds. However, the silicas do contain carbon, as evidenced by the chemical formula, i.e., SiO(CH3)2, representing the particles’ reacted surface groups. Moreover, in the absence of any kind of carbon content threshold for organic substances, it is immaterial that the molecular weights of these carbon atoms are relatively low. Therefore, due to the presence of carbon in the hydrophobic fumed silicas, the silicas cannot be described as mixtures of two or more inorganic compounds.
Because the treated fumed silicas are excluded from subheading 3824.90.39, HTSUS, they are classified in subheading 3824.90.92, HTSUS, which covers “other” chemical products or preparations. This determination is supported by the C.A.F.C.’s holding in Degussa II, as Xerox acknowledges, as well as by HQ H233358, supra. See 508 F.3d at 1050-51 (“Customs properly classified the surface-modified silica products…under Subheading 3824.90.90.”).
HOLDING:
In accordance with the above analysis, the hydrophobic fumed silicas are classified, by application of GRI 1 and GRI 6, in subheading 3824.90.9295, HTSUSA (Annotated), which provides for “Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included: Other: Other: Other: Other: Other: Other.” The 2016 column one general rate of duty for subheading 3824.90.9295, HTSUSA, is 5.0% ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at www.usitc.gov/tata/hts/.
Sixty days from the date of this decision, the Office of International Trade, Regulations and Rulings, will make this decision available for CBP personnel, and to the public on the CBP Home Page at http://www.cbp.gov by means of the Freedom of Information Act, and other methods of publication.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division