CLA-2: RR:CR:TE 967610 KSH
Port Director
U.S. Customs and Border Protection
Port of Los Angeles/Long Beach
301 East Ocean Blvd.
Long Beach, CA 90802
RE: Application for Further Review of Protest 2704-04-150050
Dear Port Director: This is in reply to your correspondence forwarding Application for Further Review of Protest (AFR) 2704-04-150050, filed by A.N. Deringer, Inc., on behalf of Powertex Inc. The protest at issue is against Customs and Border Protection’s (CBP) liquidation and assessment of additional duties on one entry of bulk containers made from coated woven polyethylene material under subheading 6305.32.0010 of the Harmonized Tariff Schedule of the United States (HTSUS).
Protestant entered the merchandise subject to this protest in subheading 3923.21.0090, HTSUS, dutiable at 3% ad valorem. However, the merchandise was liquidated under subheading 6305.32.0010, HTSUS, on March 19, 2004, dutiable at 8.5% ad valorem.
Protestant filed a protest with an application for further review on May 25, 2004. The protest was timely filed pursuant to 19 U.S.C. 1514(c)(3) and 19 C.F.R. 174.12 (e)(1). The AFR request was approved on January 12, 2005.
In support of protestant’s application for further review, protestant alleges that the port’s decision is inconsistent with New York Ruling (NY) F84105, dated March 17, 2000, in which a container liner bag was classified in subheading 3923.21.0090, HTSUS. Accordingly, further review is warranted pursuant to 19 CFR §§174.24(a) and 174.25.
FACTS:
The merchandise at issue is 53 foot sea-bulk woven liners used to transport bulk merchandise in an ocean shipping container. The liners are made from a fabric woven of polyethylene strips which meet the dimensional requirements of man-made fiber textile strips. The strips are woven into a fabric and coated on both sides with a polyethylene plastics material measuring 2 mm in thickness per side. The liners have a loading sleeve through which a loading pipe is inserted. Dry, flowable materials are loaded into the liner via the loading pipe. The liner also has a discharge spout. It does not have lifting straps.
ISSUE: Whether the container liners are classified in subheading 3923.21.0090, HTSUS, as articles for the conveyance or packing of goods, of plastics, or in subheading 6305.32.0010, as sacks and bags, of a kind used for the packing of goods. LAW AND ANALYSIS: Classification of goods under the HTSUSA is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification shall be determined 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 headings and legal notes do not otherwise require, the remaining GRI may then be applied. The Harmonized Commodity Description and Coding System Explanatory Notes (EN), constitute the official interpretation at the international level. While neither legally binding nor dispositive, the EN provide a commentary on the scope of each heading of the HTSUSA and are generally indicative of the proper interpretation of the headings.
The relevant HTSUSA provisions at issue for the classification of the container liners are as follows:
3923 Articles for the conveyance or packing of goods, of plastics; stoppers, lids, caps and other closures, of plastics:
Sacks and bags (including cones):
3923.21.00 Of polymers of ethylene
* * *
Sacks and bags, of a kind used for the packing of goods:
Of man-made textile materials:
6305.32.00 Flexible intermediate bulk containers
Section XI, Note 1(g), HTSUS, states,
This Section [Chapters 50 to 63] does not cover:
Monofilament of which any cross-sectional dimension exceeds 1 mm or strip or the like (for example, artificial straw) of an apparent width exceeding 5 mm, of plastics (chapter 39), or plaits or fabrics or other basketware or wickerwork of such monofilament or strip (chapter 46).
Note 1(h) to Section XI states: This Section [Chapters 50 to 63] does not cover: (h) Woven, knitted or crocheted fabrics, felt or nonwovens, impregnated, coated, covered or laminated with plastics, or articles thereof, of Chapter 39.
Hence, the classification of the container liners is dependent upon whether the material from which the liner is made is a textile or plastic material. Without the coating, the strips from which the fabric is made meet the width requirement of Section XI, Note 1(g) for classification as textile materials and not plastics. Therefore, the fabric made from such strips is a textile fabric. For textile fabrics coated with plastic on both sides, however, the distinction between a textile and plastic material is whether the coating can be seen with the naked eye with no account being taken of any resulting change of color, i.e., if the coating can be seen with the naked eye, the product is classified in Chapter 39, HTSUSA (EN 59.03). See also HQ 950931, dated April 24, 1992, NY F84105, dated March 17, 2000, HQ 087253, dated June 1, 1990, HQ 082644, dated March 2, 1990, and HQ 088313, dated August 2, 1991. While other container liners of coated fabric were classified elsewhere in NY F84105, dated March 17, 2000, NY G86718, dated February 22, 2001, and NY J84889, dated June 12, 2003, we believe that the container liners of those rulings were made of fabrics with coatings that were visible to the naked eye. We believe the merchandise at issue is substantially similar to the samples of HQ 950931, dated April 24, 1992; HQ 088313, dated August 2, 1991; HQ 966630, dated January 16, 2004, which we have reexamined in conjunction with our determination herein.
Protestant argues that the plastic coating of the liners at issue is visible to the naked eye inasmuch as the coating imparts a stiffness, glossy appearance, a different feel and coats the gaps between the warp and weft of the fabric. Protestant further states that “the coating is clear but covers the substrate, fills the intersections of the strips, has it’s [sic] own existence, and is without question, visible to even the most casual observer.”
We note that plastic coatings will often lend a sheen to fabric, result in a change of color, or increase a fabric's stiffness; these are factors which, while indicative of the presence of plastic, may not be taken into account in determining whether the plastic itself is visible to the naked eye. Mere "effects" of plastic coating such as sheen and stiffness are not permissible grounds for determining that coating is visible. One may be able to discern between coated and uncoated fabric and still not see the plastic coating itself, but rather the effects of the coating. While there may be slight differences in appearance between the coated portion of the fabric at issue and the uncoated base fabric, this does not necessarily mean that the plastic coating is visible as within the standard dictated by the tariff. Physical examination of the subject fabric also reveals no blurring between the warp and weft of the fabric; the underlying weave of the fabric is distinct. Moreover, when comparing the coated portion of the fabric with the uncoated portion, both have equally distinct weaves. The coating is not visible which was the same conclusion reached in the cited rulings on substantially similar merchandise.
The EN for subheading 6305.32, HTSUS, states, in pertinent part, "Flexible intermediate bulk containers are usually made of polypropylene or polyethylene woven fabrics and generally have a capacity ranging from 250 kg to 3,000 kg. They may have lifting straps at the four top corners and may be fitted with openings at the top and bottom to facilitate loading and unloading. They are generally used for packing, storage, transport and handling of dry, flowable materials." The instant container liners are for the transportation of dry, flowable materials and contain spouts for loading and unloading. Hence, they are classified in subheading 6305.32.0010, HTSUS, the provision for "Sacks and bags, of a kind used for the packing of goods: Of man-made textile materials: Flexible intermediate bulk containers."
HOLDING:
The protest should be denied in full.
The container liners are classified in subhading 6305.32.0010, HTSUS, which provides for “Sacks and bags, of a kind used for the packing of goods: Of man-made textile materials: Flexible intermediate bulk containers, weighing more than one kg or more.” The general column one rate of duty applicable at the time of entry is 8.5% ad valorem. The textile category is 669.
Quota/visa requirements are no longer applicable for merchandise which is the product of a World Trade Organization (WTO) member countries. The textile category number above applies to merchandise produced in non-WTO member-countries. Quota and visa requirements are the result of international agreements that are subject to frequent renegotiations and changes. To obtain the most current information on quota and visa requirements applicable to this merchandise, we suggest you check, close to the time of shipment, the "Textile Status Report for Absolute Quotas", which is available on our web site at www.cbp.gov. For current information regarding possible textile safeguard actions and related issues, we refer you to the web site at the Office of Textiles and Apparel of the Department of Commerce at otexa.ita.doc.gov.
In accordance with the Protest/Petition Processing Handbook, (CIS HB, January 2002, pp 18 and 21), you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision the Office of 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