CLA-2 CO:R:C:G 085354 TLS
Mr. James Caffentzis
Fitch, King, and Caffentzis
116 John Street
New York, New York 10038
RE: Reconsideration of HQ 083183
Dear Mr. Caffentzis:
You request a reconsideration of Customs ruling HQ 083183
pursuant to Part 177 of the Customs Regulations. Your letter
dated August 15, 1989 has been received by this office; the
following is our response to that request.
FACTS:
An original request was made on October 25, 1988 to our New
York office for classification of a Yankee dryer cylinder under
the Harmonized Tariff Schedule of the United States Annotated
(HTSUSA). We issued a ruling on July 12, 1989 (HQ 083183), in
which the dryer cylinder was classified under HTSUSA subheading
8419.32.50 as a dryer for paper or paperboard.
In the original ruling, pictures of the Yankee dryer
cylinder were submitted along with a description of how it is
used in the paper-making process. We also relied on the second
edition of Papermaking and Paperboard Making, vol. 3, in reaching
our decision.
The cylinder is a cast iron rotating cylinder with a very
smooth surface and is 8-20 feet in diameter. It is used between
the press and calendering sections of a papermaking machine to
dry a continuous paper sheet. The paper sheet is pressed tightly
against the hot outer shell of the Yankee cylinder by means of a
pressure roller. The outer shell of the cylinder is heated by
steam that is passed through the inner space of the cylinder.
The heated surface of the cylinder then evaporates moisture from
the paper sheet, which dries it. Different types of paper can be
produced depending on the drying process used. If the paper is
lifted off the cylinder before it is completely dry, then a crepe
or tissue-like paper is produced. If the paper is allowed to
remain on the cylinder until completely dry, then a glossy
surface is produced on the paper, known as machine glazed (MG)
paper.
ISSUE:
Under which HTS heading is the Yankee drying cylinder
properly classifiable:
1) 8439, HTSUSA, covering machinery for making pulp of
fibrous cellulosic material or making or finishing
paper or paperboard (other than the machinery of
heading 8419); parts thereof;
2) 8419, HTSUSA, covering machinery, plant or
laboratory equipment, whether or not electrically
heated, for the treatment of materials by a process,
involving a change of temperature such as heating,
cooking, roasting, distilling, rectifying, sterilizing,
pasteurizing, steaming, drying, evaporating,
vaporizing, condensing or cooling, other than machinery
or plant of a kind used for domestic purposes;
instantaneous or storage water heaters, nonelectric;
parts thereof.
LAW AND ANALYSIS:
You challenge our decision in ruling HQ 083183 because it
does not follow the factual findings of previous classification
decisions under TSUS concerning the Yankee dryer cylinder. In
doing so, you cite to two instances where Customs has classified
the Yankee dryer cylinder under TSUS item 668.06, the equivalent
of HTSUSA heading 8439, as a part of a paper-making machine. You
also cite to HQ 085355, which noted that Congress has indicated
that TSUS rulings should be considered instructive in
interpreting the HTSUSA, particularly where the nomenclature
previously interpreted in those decisions remain unchanged and no
dissimilar interpretation is required by the text of the HTS.
See H. Rep. No. 100-576, 100th Cong., 2d Sess. 548 (1988) at 550.
While there was a specific provision for Yankee dryer
cylinders under TSUS item 668.05, that particular provision was
not carried over under either HTS heading 8419 or 8439. This, of
course, is a major change and any decisions under TSUS should not
be considered instructive by reason of the legislative history
you cite. Furthermore, as noted below, the text of the HTS
requires a dissimilar interpretation.
The International Trade Commission report you refer to does
in fact call for continuity in the transition from TSUS to HTSUSA
in classification cases. We also note that the cross-reference
guide contained in the report suggests that TSUS item 668.05,
which provided a specific classification item for the Yankee
cylinder under TSUS, is cross-referenced to HTSUSA subheading
8439.99.10. We feel compelled to emphasize at this point that
the report is not binding in cases under HTSUSA, however. It has
been noted that while the intent of the conversion from TSUS to
HTSUSA was to be revenue neutral to the extent possible, it was
also recognized that the conversion would result in changes in
rates of duty in some cases. See Conversion of the Tariff
Schedules of the United States Annotated into the Nomenclature
Structure of the Harmonized System, USITC Publication 1400, 31
(June 1983). See also Customs Ruling HQ 083891 (May 14, 1989).
In not following the classification decisions concerning the
yankee dryer cylinder under TSUS, we do not ignore previously
established facts. Rather, we recognize our error in the TSUS
cases and the need to correct the erroneous factual findings upon
which they are based.
In the original ruling, we were influenced by the fact that
the cylinder's drying function is the primary feature of the
article. That steam heat is pumped into its hollow interior to
warm its surface which in turn dries the paper proves the drying
function to be essential to the cylinder's purpose. Given
additional information, we acknowledge that the drying function
does not account for the dryer cylinder's sole purpose, however.
As noted in HQ 083183, different types of paper can be
produced with the cylinder depending on how the paper is lifted
from the surface of the cylinder and at what speed it is done.
The versatility of the Yankee dryer cylinder in this process is
what makes the Yankee dryer cylinder an essential part of the
paper-making machine. Drying the paper is just one aspect of the
cylinder's function within the entire paper-making process. It
assists in the paper-making process itself, rather than being
ancillary or subordinate to that function.
Despite the significance of the drying function to the
overall paper-making process, we find the Yankee dryer cylinder
to be first and foremost a dryer. Based on the facts presented,
it appears that what in fact makes the paper is the process by
which the paper is removed from the cylinder, not any particular
function of the cylinder other than drying. Stated differently,
the drying function of the Yankee dryer cylinder is an essential
part of the paper-making process but is not the embodiment of
such. Therefore, we find the principal function of the yankee
dryer cylinder to be the drying of paper or paperboard within the
framework of a paper-making process.
Note 2(a) of section XVI requires that parts which are goods
included in any of the headings of chapters 84 and 85 are in all
cases to be classified in their respective headings. Heading
8439 provides for such articles, covering "machinery for making
pulp of fibrous cellulosic material or for making or finishing
paper or paperboard (other than the machinery of heading 8419);
parts thereof." (emphasis added). We agree that it is
irrefutable that the yankee dryer cylinder is a part of a paper-
making machine, and therefore classifiable under 8439. It is
crucial to note here that 8439 does not prevail over heading 8419
if an article is classifiable under both provisions, however.
You cite to Explanatory Note 84.19, which explains that the
heading excludes machinery in which the heating, even if
essential, is merely a secondary function designed to facilitate
the main mechanical function of the machine. While we did not
expressly make note of this in our earlier analysis, we did not
ignore or overlook this explanation in our original ruling,
either. As discussed above, we simply do not consider the drying
function of the yankee cylinder to be its secondary function, but
rather its primary function within the paper-making process.
Heading 8419 covers machinery for the treatment of materials
by a process involving a change of temperature, such as drying.
Being a parts provision, 8439 must give way to 8419, which
describes the yankee dryer cylinder with more specificity,
according to its function. Note 2(a) is intended to cover
precisely this type of scenario. Additional support for this
position is found under the Explanatory Notes for heading 8439.
The Explanatory Notes (EN), although not dispositive, should be
looked to for the proper interpretation of the HTSUSA. See 54
Fed. Reg. 35127, 35128 (August 23, 1989). EN 84.39(a) explains
that this heading excludes, among other things, steam heated
cylinder and other drying machines of heading 8419. EN 84.19
(III)(D), explains that among the articles included in this
heading are rotary dryers. Rotary dryers are described as
revolving cylinders or drums which may be heated internally or
externally and are used in various industries, such as paper-
making. We also refer back to heading 8439, which limits the
type of articles covered under its provision by including only
machines "other than [those] of heading 8419." The yankee dryer
cylinder is a revolving cylinder which is heated internally by an
injection of steam and is used in a paper-making process. Thus,
because of the exclusive language of note 2(a), heading 8439, and
EN 84.39(a), and the inclusive language of EN 84.19 (III)(D), we
must find the yankee dryer cylinder to be properly classifiable
under heading 8419 as machinery for the treatment of materials by
the process of drying.
HOLDING:
The Yankee dryer cylinder is classified under subheading
8419.32.50, HTSUSA, as a dryer for paper and paperboard.
Sincerely,
John Durant, Director
Commercial Rulings Division