CLA-2 OT:RR:CTF:TCM H244174 ALS
Ms. Julie Vair
Senior Consultant
Expeditors Tradewin, LLC
1015 3rd Avenue, 12th Floor
Seattle, Washington 98104
RE: Modification of Customs and Border Protection (CBP) Ruling NY N230615 (September 13, 2012); Revocation of CBP Ruling NY N200119 (February 10, 2012); tariff classification of composite articles consisting of aluminum alloy sheets and polyethylene
Dear Ms. Vair:
This letter is in response to your request for reconsideration of CBP Ruling NY N230615 (September 13, 2012), as noted above, on behalf of Right Brain Materials, LLC. The ruling and your request concern the legal tariff classification of beBond painted ACP sheets having peelable plastic protective film on both sides. During our review, we have found CBP Ruling NY N200119 also merits reconsideration along with NY N230615. Based on our review, we published a Proposed Notice of Action in the Customs Bulletin, Vol. 50, Nos. 2 and 3, on January 20, 2016, which proposed to modify NY N230615 and revoke NY N200119. No comments were received in response to that notice. Our discussion of both cases and our decision are set forth below.
FACTS:
These are the facts as were noted in NY N230615:
The products under consideration are described as beBond ACP sheets, composite articles comprised of a polyethylene core sandwiched and permanently bonded between two Alloy 1100 aluminum sheets. These sheets meet the Chapter 76, Subheading Note 1(a) definition of not alloyed and range in thickness from 0.1 mm to 0.2 mm. They are available in a variety of cut sizes (4’ X 8’, 4’ X 10’ and 5’ X 10’) and are used in the signs and graphics industry. In your request, you indicate that the sheets are imported two different ways depending on customer requirements. The aluminum is either mill finished (no finish) or painted with a polyester paint. In the case of the painted versions, a clean peel, protective, plastic covering will be applied to either one or both sides of the aluminum sheets. You state the function of the plastic film is to protect the painted surface during transit and will be removed before delivery to the end user.
Historically, peelable plastic film that is protective in nature has been considered backing material when applied to one side of an aluminum foil product. However, when the same film, or some other type of backing material, is applied to both sides of a foil product, the foil is no longer viewed as backed.
You request reconsideration of NY N230615 with regard to the painted beBond ACP sheets with a thickness of 0.1 mm or more but not exceeding 0.15 mm and having a peelable protective plastic film on both sides and the painted beBond ACP sheets with a thickness of at least 0.16 mm or more but not exceeding 0.2 mm and having a peelable protective plastic film on both sides. You contend “that there were certain facts that were misunderstood or not taken into consideration....”
You expressly state that you agree with the ruling in NY N230615 with regard to mill finished (non-painted) beBond aluminum composite sheets and painted beBond aluminum composite sheets having a peelable protective plastic film on only one side as being properly classified under HTSUS subheading 7607.20.50.
As noted above, NY N200119 also merits reconsideration in light of our review of this case. The facts of that case were described in that decision as follows:
The product to be imported is SIGNABOND®, a composite article comprised of a polyethylene core sandwiched between two Alloy 1100 aluminum sheets. The exposed sides of the aluminum sheets will be covered with a peelable protective film. These sheets meet the Chapter 76, Subheading Note 1(a) definition of not alloyed and will have a thickness of .15 mm, .20 mm or .30 mm. SIGNABOND® is available in a variety of cut sizes, colors and textures and is used in the sign and graphics industry.
ISSUES:
Are the painted beBond aluminum composite panel sheets with a thickness of 0.1 mm or more but not exceeding 0.15 mm and having a peelable protective plastic film on both sides properly classified under HTSUS subheading 7607.19.30 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Not backed: Other: Cut to shape, of a thickness not exceeding 01.5mm,” or under HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other”?
Are the painted beBond aluminum composite panel sheets with a thickness of at least 0.16 mm or more but not exceeding 0.2 mm and having a peelable protective plastic film on both sides properly classified under HTSUS subheading 7607.19.60 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Not backed: Other: Other,” or under HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other”?
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 HTSUS provisions are under consideration:
7607 Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness (excluding any backing) not exceeding 0.2 mm:
Not backed:
7607.19 Other:
7607.19.30 Cut to shape, of a thickness not exceeding 0.15 mm..........
7607.19.60 Other................
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7607.20 Backed:
7607.20.50 Other................
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GRI 1 provides the following:
1. The table of contents, alphabetical index, and titles of sections, chapters and sub-chapters are provided for ease of reference only; for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to the following provisions:...
GRI 3(b) provides the following:
3. When, by application of rule 2(b) or for any other reason, goods are, prima facie, classifiable under two or more headings, classification shall be effected as follows:
(b) Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
GRI 6 provides the following:
6. For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
Subheading Note 1(a) to Chapter 76, HTSUS, provides the following:
1. In this chapter the following expressions have the meanings hereby assigned to them:
(a) Aluminum, not alloyed
Metal containing by weight at least 99 percent of aluminum, provided that the content by weight of any other element does not exceed the limit specified in the following table:
TABLE - Other elements
Element Limiting content percent by weight
___________________________________________________________
Fe + Si (iron plus silicon) 1
Other elements(1), each 0.1(2)
___________________________________________________________
(1) Other elements are, for example, Cr, Cu, Mg, Mn, Ni, Zn.
(2) Copper is permitted in a proportion greater than 0.1 percent but not more than
0.2 percent, provided that neither the chromium nor manganese content exceeds
0.05 percent.
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Before we consider whether the subject article is backed or not, we must address the significance of the protective plastic packaging in this case. You state that “in accordance with GRI [5(b)], it is [CBP’s] precedent to not take into consideration protective plastic packaging when determining the HTS assuming its meets both criteria of GRI [5(b)]: - that it is the type normally used for packing such goods; and that it is not suitable for repetitive use.” You cite to CBP Ruling NY N004056 (December 21, 2006) (plastic film found to be display material) and CBP Ruling NY D81573 (September 29, 1998) (plastic cap found to be protective covering). You also cite to CBP Ruling NY 889128 (September 14, 1993) to distinguish it from the present case, noting that CBP ruled in NY 889128 that “GRI 5b requires that the packing material meet two qualifications: that it is the type normally used for packing such goods; and that it is not suitable for repetitive use”, and as such the article at issue therein did not qualify.
GRI 5(b) states the following:
5. In addition to the foregoing provisions, the following rules shall apply in respect of the goods referred to therein:
(b) Subject to the provisions of rule 5(a) above, packing materials and packing containers entered with the goods therein shall be classified with the goods if they are of a kind normally used for packing such goods. However, this provision is not binding when such packing materials or packing containers are clearly suitable for repetitive use.
Upon further review and consideration of the foregoing, we find that the peelable plastic film applied to the ACP sheets before shipment is in fact packing material of the kind to which GRI 5(b) is applicable. It is normally used for packing the ACP sheets as a protection of the painted side or sides of the ACP sheets during shipment, and since it is discarded upon unpacking, it is not suitable for repetitive use. Thus, the peelable plastic film is not a backing material of the beBond ACP sheets. We find such to be the case whether or not the plastic film is applied to one side of the ACP sheet because only one side is painted, or to both sides when both sides are painted.
With regard to whether or not the subject article is backed or not, you state that “the only difference between the beBond ACP sheets that CBP classified as being ‘not backed’ is whether or not they were painted. The products are otherwise identical.” You quote the following from CBP Ruling HQ H045859 (February 5, 2009):
The tariff does not define the term "backed." When a tariff term is not defined by the HTSUS or the legislative history, its correct meaning is its common, or commercial, meaning. Rocknel Fastener, Inc. v. United States, 267 F.3d 1354, 1356 (Fed. Cir. 2001). "To ascertain the common meaning of a term, a court may consult 'dictionaries, scientific authorities, and other reliable information sources' and 'lexicographic and other materials.'" Id. (quoting C.J. Tower & Sons of Buffalo, Inc. v. United States, 673 F.2d 1268, 1271, 69 C.C.P.A. 128 (C.C.P.A. 1982); Simod Am. Corp. v. United States, 872 F.2d 1572, 1576 (Fed. Cir. 1989)). The Random House Dictionary of the English Language defines "backing" as "that which forms the back or is placed at or attached to the back of anything to support, strengthen, or protect it. The aluminum industry defines the term "backed foil" as "a lamination composed of foil and a coherent substrate. The substrates or backing may be either self-adherent or bonded to the foil by means of an interposed adhesive. Paper, woven fabrics, cellophane, polyethylene film and the like are typical examples of such backings or substrates." (Cited in HQ 965210, March 20, 2002, and HQ 966769, January 5, 2004.) Based on these sources, CBP has previously found that the word "backed" is defined, in pertinent part, as "having a back, setting or support." Id. We now note that the Oxford English Dictionary (Oxford University Press, 2008) defines the noun "back" as: "3. a. gen. That side or surface of any part … of any object, which answers in position to the back; that opposite to the face or front, or side approached, contemplated or exposed to view; e.g. the back of the head, of the leg; the back of a house, door, picture, bill, tablet, etc." Also, "5. a. The side of any object away from the spectator, or spectators generally, the other or far side, at the back of: behind, on the farther side of[.]"
Furthermore, EN 74.10 (which applies, mutatis mutandis, to heading 76.07 (see EN 76.07)) explains that "backing" may be added to a good to facilitate handling or transport or in order to facilitate subsequent treatment. Based on the common and commercial meaning of the word "backed" and the explanation provided in the ENs, we find that foil to one side of which a coherent substrate has been added (the "back") in order to strengthen, support, or protect the foil or to facilitate handing, transport or subsequent treatment may be classified in heading 7607 as "backed" foil on the basis of GRI 1. (Emphasis added.)
We note at this point that the Explanatory Notes (EN) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989). The EN for heading 7607 is as follows:
76.07 Aluminium foil (whether or not printed or backed with paper, paperboard, plastics or similar backing materials) of a thickness (excluding any backing) not exceeding 0.2 mm (+).
Not backed :
7607 -- Rolled but not further worked
7607.19 -- Other
7607.20 -- Backed
This heading covers the products defined in Chapter Note 1 (d), when of a thickness not exceeding 0.2 mm.
The provisions of the Explanatory Note to heading 74.10 relating to copper foil apply, mutatis mutandis, to this heading.
Aluminium foil is used in the manufacture of bottle caps and capsules, for packing foodstuffs, cigars, cigarettes, tobacco, etc. Aluminium foil is also used for the manufacture of the finely divided powder of heading 76.03, in crinkled sheets for thermal insulation, for artificial silvering, and as a wound dressing in veterinary surgery.
The heading does not cover:
(a) Stamping foils (also known as blocking foils) composed of aluminium powder agglomerated with gelatin, glue or other binder, or of aluminium deposited on paper, plastics or other support, and used for printing book covers, hat bands, etc. (heading 32.12).
(b) Paper and paperboard for the manufacture of containers for milk, fruit juice or other food products and lined with aluminium foil (i.e., on the face which will form the inside of the containers) provided they retain the essential character of paper or paperboard (heading 48.11).
(c) Printed aluminium foil labels being identifiable individual articles by virtue of the printing (heading 49.11).
(d) Plates, sheets and strip, of a thickness exceeding 0.2 mm (heading 76.06).
(e) Foil in the form of Christmas tree decorations (heading 95.05). (Emphasis added.)
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The guidance of the World Customs Organization’s (WCO’s) Harmonized System Committee (HSC) is also relevant and helpful in this case. As stated in T.D. 89-80, CBP accords HSC opinions the same weight as that of ENs, i.e., while not legally dispositive nor binding, these opinions are generally indicative of the proper interpretation of these headings. The HSC just recently issued an official position at its 56th Session on reflective insulation consisting of a layer of polyethylene air bubble wrap sandwiched between two layers of aluminum foil. The HSC concluded that the aluminum foil/polyethylene air bubble wrap/aluminum foil article should be classified “under [HTSUS] heading 76.07 (subheading 7607.20) by application of GIRs [GRIs] 1, 3(b) and 6...” The HSC finds that the aluminum foil imparts the essential character of the article and that the inner layer bubble wrap functions as an insulator and as a backing, citing, mutatis mutandis, [Harmonized Tariff Schedule Explanatory Note] 74.10.
In this case, we find the aluminum sheet/polyethylene/aluminum sheet construction of the ACP sheets to be sufficiently similar to that of the article that the HSC recently issued its opinion on. In that regard the ACP sheet’s polyethylene inner layer provides backing to the aluminum sheet layers to prevent “bowing, warping, swelling, and delamination” as is marketed by at least one retailer. Consequently, we find that our ruling in CBP Ruling HQ 960276 (August 1, 1997), that an article comprised of aluminum/polypropylene/aluminum is properly classified under HTSUS subheading 7607.20.50 as “Aluminum foil...: Backed: Other” is correct and dispositive in this case.
Based on these findings, the proper legal tariff classification of painted beBond aluminum composite panel sheets with a thickness of 0.1 mm or more but not exceeding 0.15 mm and having a peelable protective plastic film on both sides is HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other......” The proper legal tariff classification of painted beBond aluminum composite panel sheets with a thickness of 0.16 mm or more but not exceeding 0.2 mm and having a peelable protective plastic film on both sides is also HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other......” Accordingly, CBP Ruling NY N230615 should be modified only with respect to the beBond ACP sheets discussed in this paragraph.
As noted above, there are other rulings that warrant reconsideration in light of our findings here along with the underlying case. In CBP Ruling HQ H045859 (February 5, 2009), we held that a tri-laminate foil of PET (polyethylene terephthalate)/aluminum foil/peelable HDPE (high-density polyethylene) was not backed aluminum foil because the plastic composite layers comprised the two outer sides of the article, rather than one side of the aluminum foil layer. We distinguish H045859 from the present case in noting that the subject article is comprised of one inner layer of plastic composite with the two outer sides being aluminum sheets, and that the peelable plastic protective film is immaterial to its tariff classification, whether it is applied to one side or both sides.
In CBP Ruling NY N200119 (February 10, 2012), CBP held that a composite article called SIGNABOND®, which consists of a polyethylene core sandwiched between two aluminum sheets and covered with peelable protective film on both outer sides was not aluminum foil because the peelable protective film was applied to both sides, rather than just one side. As we now find such peelable protective film to be packing as defined under GRI 5(b), and given the very similar constitution of SIGNABOND® to beBond ACP sheets, we conclude that CBP Ruling NY N200119 should be revoked.
HOLDING:
In accordance with GRI 1, GRI 3(b), GRI 5(b), GRI 6, and Subheading Note 1(a) to Chapter 76, HTSUS, painted beBond aluminum composite panel sheets with a thickness of 0.1 mm or more but not exceeding 0.15 mm and having a peelable protective plastic film on both sides are properly classified under HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other......”
In accordance with GRI 1, 3(b), GRI 5(b), GRI 6, and Subheading Note 1(a) to Chapter 76, HTSUS, painted beBond aluminum composite panel sheets with a thickness of 0.16 mm or more but not exceeding 0.2 mm and having a peelable protective plastic film on both sides are properly classified under HTSUS subheading 7607.20.50 as “Aluminum foil (whether or not printed, or backed with paper, paperboard, plastics or similar backing materials) of a thickness excluding any backing) not exceeding 0.2 mm: Backed: Other......”
The general column one rate of duty, for merchandise classified under HTSUS subheading 7607.20.50 is “Free.”
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.
EFFECT ON OTHER RULINGS:
CBP Ruling NY N230615 (September 13, 2012) is hereby modified as noted above.
CBP Ruling NY N200119 (February 10, 2012) is hereby revoked.
In accordance with 19 U.S.C. §1625(c), this ruling will become effective 60 days after publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division