CLA-2 OT:RR:CTF:TCM H245899 TNA
Port Director, Service Port-Hartford
U.S. Customs and Border Protection
Bradley International Airport
International Arrivals Building
Windsor Locks, CT 06096
Attn: John Cox, Import Specialist
RE: Application for Further Review of Protest No: 0411-13-100020; Classification of thermal transfer ribbon; Revocation of HQ 088950, NY 850825, HQ 952401, and HQ 952835 by operation of law
Dear Port Director:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest No. 0411-13-100020, timely filed on July 12, 2013, on behalf of Kurtz Transfer Products (“Kurtz” or “Protestant”). The AFR concerns the classification of thermal transfer ribbons under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of two styles of thermal transfer ribbons: the Gerber, which measures 308 millimeters in width, and the Linford, which measures 311 millimeters in width. Each thermal transfer ribbon is imported on a cardboard core roll and is cut to the customer’s specific dimensions at the time of importation. Each roll contains one long ribbon wound around the core. They are not imported with a mechanical cartridge or any other mechanism.
These thermal transfer ribbons are mainly used to create product labels in a digital process called thermal transfer printing. This type of printing transfers the ink on the subject thermal transfer ribbons to a substrate material through the use of heat, but without the use of any pressure. This heat melts the thermal transfer ribbons’ coating onto the substrate. The substrate is usually made of paper, but can also be made from other materials, such as plastic.
The thermal transfer printers with which the subject merchandise is used contain a fixed-width thermal print head that traverses the substrate. The subject thermal transfer ribbons lie between the print head and the label, and consist of three layers: a thin layer of polyester film, the ink transfer layer, and the backside coating. The “ink” layer is not actual ink. Rather, its composition varies depending on the type of thermal transfer ribbon at issue and consists of either pure wax, pure resin, or a mixture of wax and resin. The substrate material and the thermal transfer ribbons run beneath the printer’s print head, which has a thermal element that heats the “ink” off of the polyester film, melting it onto the surface of the substrate and thereby creating the printed label.
The subject merchandise entered on April 25, 2012, under subheading 9612.10.10, HTSUS, which provides for “Typewriter or similar ribbons, inked or otherwise prepared for giving impressions, whether or not on spools or in cartridges; ink pads, whether or not inked, with or without boxes: Ribbons: Measuring less than 30 mm in width, permanently put up in plastic or metal cartridges (whether or not containing spools) of a kind used in typewriters, automatic data processing or other machines.” Subject to a Notice of Action dated January 9, 2013, U.S. Customs and Border Protection (“CBP”) liquidated the merchandise on February 15, 2013 in subheading 9612.10.90, HTSUS, which provides for “Typewriter or similar ribbons, inked or otherwise prepared for giving impressions, whether or not on spools or in cartridges; ink pads, whether or not inked, with or without boxes: Ribbons: Other.” The importer filed its protest on July 12, 2013, claiming classification under subheading 3702.44.01, HTSUS, which provides for “Photographic film in rolls, sensitized, unexposed, of any material other than paper, paperboard or textiles; instant print film in rolls, sensitized, unexposed: Other film, without perforations, of a width exceeding105 mm: Of a width exceeding 105 mm but not exceeding 610 mm.”
ISSUE:
Whether thermal transfer ribbons are classified in heading 3702, HTSUS, as “Photographic film in rolls” or in heading 9612, HTSUS, which provides for “Typewriter or similar ribbons, inked or otherwise prepared for giving impressions, whether or not on spools or in cartridges?”
LAW AND ANALYSIS:
Initially, we note that the matter is protestable under 19 U.S.C. §1514(a)(2) against your decision on classification. The protest was timely filed, within 180 days of liquidation. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006)).
Further Review of Protest No. 0411-13-100020 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed is alleged to be inconsistent with a ruling of the Commissioner of CBP or his designee, or with a decision made at any port with respect to the same or substantially similar merchandise. Specifically, the Protestant argues that CBP’s liquidation of the subject merchandise in heading 9612, HTSUS, is contrary to NY N094576, dated February 25, 2010, NY L87275, dated September 27, 2005, and NY K87956, dated August 10, 2004.
Classification under the Harmonized Tariff Schedule of the United States (HTSUS) is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods 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 GRIs may then be applied.
The HTSUS provisions under consideration are as follows:
3702 Photographic film in rolls, sensitized, unexposed, of any material other than paper, paperboard or textiles; instant print film in rolls, sensitized, unexposed:
9612 Typewriter or similar ribbons, inked or otherwise prepared for giving impressions, whether or not on spools or in cartridges; ink pads, whether or not inked, with or without boxes:
Note 2 to Chapter 37, HTSUS, provides that:
In this chapter the word “photographic” relates to the process by which visible images are formed, directly or indirectly, by the action of light or other forms of radiation on photosensitive surfaces.
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not 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 (Aug. 23, 1989).
The EN to heading 3702, HTSUS, provides, in pertinent part:
This heading covers:
(A) Photographic film in rolls, of any material other than paper, paperboard or textiles.
Photographic film in rolls (i.e., other than flat), sensitised, unexposed is usually of poly(ethylene terephthalate), cellulose acetate or similar flexible materials and normally provides for a number of exposures. The heading does not cover such film of paper (e.g., paper “films” used to make negatives), paperboard or textiles (heading 37.03).
Film in rolls falls in this heading with or without perforations; it must be protected from the light by paper backing or other suitable packing…
Like the photographic plates of heading 37.01, this film may be used for amateur, professional photomechanical, scientific, radiographic, etc., purposes. X-ray film in rolls is generally sensitised on both sides.
The EN to heading 9612, HTSUS, provides, in pertinent part:
This heading covers:
Ribbons, whether or not on spools or in cartridges, for typewriters,
calculating machines, or for any other machines incorporating a device for printing by means of such ribbons (automatic balances, tabulating machines, teleprinters, etc.).
The heading also includes inked, etc., ribbons, usually having metal fixing fittings, used in barographs, thermographs, etc., to print and record the movement of the recording machine needle.
These ribbons are usually of woven textiles, but sometimes they are made of plastics or paper. To fall in the heading, they must have been inked or otherwise prepared to give impressions (e.g., impregnation of textile ribbons, or coating of plastics strip or paper with colouring matter, ink, etc.).
The heading does not cover:
(a) Rolls of carbon or other copying paper strip, not suitable for use as typewriter, etc., ribbons, but designed to produce duplicate copies in accounting machines, cash registers, etc. This strip, which is usually much wider than typewriter ribbons (generally more than 3 cm in width), falls in Chapter 48.
(b) Ribbons not prepared by inking, impregnation, coating, etc., to give an impression; these are classified in Chapter 39, Section XI, etc., according to the constituent material.
(c) Empty spools (classified according to their constituent material).
In QMS, Inc., v. United States, 19 C.I.T. 551; 17 Int’l Trade Rep. (BNA) 1510; 1995 Ct. Intl. Trade LEXIS 104; SLIP OP. 95-65 (Ct. Int’l Trade 1995), the court examined the classification of color ink sheet rolls (“ISRs”), also known as thermal transfer ribbons in the trade. See QMS, Inc., v. United States, 19 C.I.T. 551, 552 (“QMS”). These ISRs were specially designed solely for use in color thermal transfer printers that were used to print graphics with automatic data processing equipment. The printers could not function as intended without color ISRs. Id. at 551. In their condition as imported, the ISRs consisted of a thin polymer (i.e., plastic) film to which paraffin wax pigments (or “inks”) in varying color configurations (i.e., yellow, magenta, cyan, and black) had been applied. Id. at 551. The ISRs varied in size, depending on the color thermal transfer printers for which they are specially designed. They were between 228 and 325 millimeters in width, between 105 and 297 meters in length, and between 50 and 74 millimeters in diameter when tightly wound around a reinforced cardboard core. Id. at 551-552.
The court first considered classification in heading 9612, HTSUS, as typewriters or similar ribbons, and found that the subject ISRs could not be classified there because of the differences in physical characteristics and printing processes between ISRS and typewriter ribbons. Id. at 556. The court reasoned that typewriter ribbons are typically narrow while the ISRs were wide. Id. at 559. The court also noted that when typewriter ribbons are used, the ink is transferred to paper by impression which occurs when the ribbon is directly impacted by a mechanical striker. Thus, the court stated that the purpose of such ribbons is to serve as a medium for printing on paper by impression from impact, not the general purpose of printing. Id. at 559-560. By contrast, the court found that the purpose of the ISRs was to serve as a medium for the printing of graphic images on paper by use of heat. In the thermal printing process, pigmented wax is never transferred to the paper by means of impact. Id. at 560. As a result, the court found that the subject ISRs could not be classified in heading 9612, HTSUS.
In the present case, the subject thermal transfer ribbons also cannot be classified as typewriter ribbons of heading 9612, HTSUS, because they too are not similar enough to typewriter ribbons to be classified there. Not only are the subject thermal transfer ribbons longer and wider than typewriter ribbons, they also function as a medium for printing images onto various media by way of heat. This is in contrast to typewriter ribbon, which functions by transferring an image by way of impact. As a result, the subject thermal transfer ribbons cannot be classified in heading 9612, HTSUS. Hence, HQ 088950, dated July 1, 1991 and NY 850825, dated April 3, 1990, on which the port relied in the liquidating the subject merchandise, are revoked by operation of law. In addition, HQ 952401, dated November 18, 1992, and HQ 952835, dated March 18, 1993 also classified thermal transfer ribbons in heading 9612, HTSUS. These rulings, which were issued before the QMS case was decided, are also revoked by operation of law.
Under Note 2 to Chapter 37, HTSUS, and supporting lexicographic materials, the court found that the term “photographic” was broad enough to include more than just conventional photography. The court also found that the thermal transfer process that the ISRs utilized was a “photographic” process because it was sufficient that the ISRs permitted the formation of visible images directly or indirectly by the action of light or other forms of radiation on sensitive surfaces. The court concluded that the ISRs were described by the terms of heading 3702, HTSUS, because they were “photographic film” in that they were in rolls, sensitized to heat radiation, unexposed to heat radiation, and made of a material other than paper, paperboard or textiles. Accordingly, the court classified the ISRs under heading 3702, HTSUS. Id. at 562.
Likewise, in the present case, the subject thermal transfer ribbons meet the terms of heading 3702, HTSUS. These ribbons transfer visible images onto sensitive surfaces directly by way of heat. They are also imported in rolls, and are sensitized to heat. Furthermore, while the subject merchandise’s substrate can be made of paper, it can also be made of plastic, and the subject merchandise’s other components include resin and wax. As such, the subject merchandise meets the definition of the term “photographic” as defined by the QMS court. As a result, the subject merchandise is classified in heading 3702, HTSUS, which provides for “Photographic film in rolls, sensitized, unexposed, of any material other than paper, paperboard or textiles; instant print film in rolls, sensitized, unexposed.” This conclusion is consistent with prior CBP rulings. See HQ 960328, dated February 4, 1998; HQ 963093, dated September 22, 1999; NY N094576, dated February 25, 2010; NY K87956, dated August 10, 2004; NY L87275, dated September 27, 2005; NY D80198, dated August 6, 1998.
HOLDING:
Under the authority of GRIs 1, the subject thermal transfer ribbons are classified in heading 3702, HTSUS. Specifically, they are classified in subheading 3702.44.01, HTSUS, which provides for: “Photographic film in rolls, sensitized, unexposed, of any material other than paper, paperboard or textiles; instant print film in rolls, sensitized, unexposed: Other film, without perforations, of a width exceeding 105 mm: Of a width exceeding 105 mm but not exceeding 610 mm.” The column one general rate of duty is 3.7% 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/.
You are instructed to ALLOW the protest.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision, the Office International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP website 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