CLA-2 CO: R:C:G: 083733 JLJ, 835140
Category: Classification
Mr. Gordon Leontowich, Director
Western Wood Preservers, Ltd.
26035 31B Avenue
Aldergrove, British Columbia, VOX IAO
Canada
RE: Tariff classification of drilled lumber sent to Canada
to be microincised and pressure treated with a preserative
Dear Mr. Leontowich:
You requested a tariff classification under the Harmonized
Tariff Schedule of the United States Annotated (HTSUSA) for
United States drilled lumber which is shipped to Canada to be
microincised and pressure treated with a preservative, then
imported into the United States.
FACTS:
You state that Bellingham Marine Industries Inc., of
Bellingham, Washington, has sent its United States cut and
drilled Douglas fir (i.e., softwood) lumber to your firm in
British Columbia, Canada, for treatment for more than three
years. Under the Tariff Schedules of the United States (TSUS),
the lumber was imported into the United States under the tariff
provision for lumber and wood siding, drilled or treated:
softwood lumber and siding, drilled, or pressure treated with
wood creosote or other wood preservative, or both, but not
otherwise treated, in item 202.52, TSUS, which was a duty-free
provision. We note that item 202.52, TSUS, specifically provided
for drilled softwood lumber which had been pressure treated with
a wood preservative.
Under the HTSUSA, you have been advised by a Customs import
specialist that the returning lumber is subject to duty under the
provision for builders' joinery and carpentry of wood, other,
other, in subheading 4418.90.40, HTSUSA, which carries a 5.1
percent ad valorem duty rate. You believe that this subheading
is incorrect because merchandise classified accordingly is
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subject to duty, while the instant lumber was duty-free under the
TSUS. You ask that Customs reconsider this advice.
The exact details of the finishing of the lumber are as
follows:
1. United States softwood lumber cut to dimensional
stock sizes and drilled with as many as 6 holes per
piece are sent from Bellingham Marine Industries
(BMI) in Washington state to Western Wood
Preservers, Ltd. (WWP), in British Columbia, Canada.
2. In Canada, WWP microincises and pressure treats the
lumber with chromated copper arsenate (CCA), a water
borne preservative purchased from a United States
firm.
3. Once the lumber has been treated, it is exported to
the United States.
Once back in the United States, BMI uses the drilled and pressure
treated lumber for making flotation units and docks for marinas.
(You advise that the end use of the instant lumber is such that
the drilling and cutting to dimensional stock size must be done
before the pressure treatment with CCA. The drilled holes are
used for fasteners, such as bolts and pins, necessary to assemble
the docks.)
ISSUE:
What is the tariff classification of such drilled and
treated lumber under the HTSUSA?
LAW AND ANALYSIS:
You argue that subheading 4418.90.40, HTSUSA, is not
applicable to the drilled lumber in question because it results
in the merchandise being subject to duty. You believe that this
is an inequitable result, particularly since the United States-
Canada Free Trade Agreement (CFTA) was intended to lower and
eliminate duty rates between the two countries and since the CFTA
was inaugurated at the same time as the HTSUSA.
Heading 4418, HTSUSA, reads as follows:
Builders' joinery and carpentry of wood, including cellular
wood panels and assembled parquet panels; shingles and
shakes.
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The Explanatory Notes, HTSUSA, for Heading 4418 state that:
This heading applies to woodwork, including that of wood
marquetry or inlaid wood, used in the construction of
any kind of building, etc., in the form of assembled
goods or as recognizable unassembled pieces (e.g.,
prepared with tenons, mortises, dovetails or other
similar joints for assembly), whether or not with their
metal fittings such as hinges, locks, etc.
The term..."carpentry" refers to woodwork (such as
beams, rafters and roofstruts) used for structural
purposes...
Inasmuch as the instant drilled, treated lumber is used for
structural purposes in the construction of flotation units and
docks for marinas and fits within Heading 4418, it must be
classified accordingly. Since the instant lumber does not fit
within any of the eo nomine subheading in Heading 4418 and is not
edge-glued lumber, it is classified as builders' joinery and
carpentry of wood, other, other, in subheading 4418.90.40,
HTSUSA.
We note that another letter concerning the instant lumber,
from Mr. Robert L. Wenman, a member of the Canadian Parliament,
raises two other possible HTSUSA classifications, in Heading 4403
or Heading 4407, HTSUSA. Heading 4403 provides for wood in the
rough, whether or not stripped of bark or sapwood, or roughly
squared; it covers wood in the rough prior to being made into
lumber, e.g., timber, poles and logs. The Explanatory Notes to
Heading 4403 state that this heading excludes wood cut in the
form of planks, beams, etc., which are covered in either Heading
4407 or 4418, depending upon what has been done to the wood.
Heading 4407 covers wood sawn or chipped lenghwise, sliced or
peeled, whether or not planed, sanded or finger-jointed, of a
thickness exceeding 6 millimeters. The Explanatory Notes to
Heading 4407 indicate that this heading covers such products as
sawn beams, planks, flitches and boards. Wood classified in
Heading 4407 may only be planed, sanded or finger-jointed; it may
not be further processed. Again, the Explanatory Notes to
Heading 4407 specifically state that the heading excludes
builders' joinery and carpentry, which is classified in Heading
4418.
Mr. Wenman also argues that subheading 9802.00.40, HTSUSA,
may be applicable to the instant lumber. Subheading 9802.00.40
provides for articles exported for repairs or alterations; it is
the successor of item 806.20, TSUS, with identical language.
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Concerning the application of item 806.20, TSUS, it has been
held that the operations performed on the articles must not
constitute a part of the total manufacturing process begun in the
United States. Dolliff & Company, Inc. v. United States, 66 CCPA
77, C.A.D. 1225 (1979).
Lumber which is specifically intended for exterior
construction, ground contact areas or marine use is not a
finished product until it has been further manufactured by being
pressure treated with a wood preservative.
The instant lumber exported to Canada is not a finished
product ready for its intended use. The microincising and
pressure treatment of the lumber in Canada constitutes a part of
the manufacturing process begun in the United States.
The Canadian finishing operations exceed the scope of the
term "repairs or alterations" under item 806.20, TSUS, and hence
under subheading 9802.00.40, HTSUSA. Guardian Industries
Corporation v. United States, 3 CIT 9, Slip Op. 82-4 (1982).
Therefore, the drilled and pressure treated lumber is not
entitled to the benefits of this provision.
Goods classified in subheading 4418.90.40, HTSUSA, which
originate in Canada are entitled to a 4.5 percent ad valorem rate
of duty under the CFTA upon compliance with all applicable
regulations.
HOLDING:
The instant drilled, treated lumber is classified as other
carpentry in subheading 4418.90.40, HTSUSA.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc: A.D. N.Y. Seaport (NIS-234)
Johnson library
name: 083733JLJ