CLA-2 CO:R:C:F 088894 RFC
Mr. Donald W. Paley
Sharretts, Paley, Carter & Blauvelt
Sixty-Seven Broad Street
New York, NY 10004
RE: Methyl alcohol; methanol
Dear Mr. Paley:
This ruling letter is in response to your request of March
8, 1991, on behalf of Celanese Chemical Company, concerning the
tariff classification under the Harmonized Tariff Schedule of the
United States Annotated (HTSUSA) of methanol (methyl alcohol)
imported from Canada.
FACTS:
Celanese imports into the United States methanol that is
intended for use in producing a synthetic natural gas or for
direct use as a fuel. Celanese states that these importations
of methanol qualify for special-tariff treatment under the
United States-Canada Free-Trade Agreement ("FTA").
ISSUE:
Whether an importer of methanol qualifying for special-
tariff treatment under the FTA may enter the methanol under
subheading 2905.11.10 rather than under subheading 2905.11.20 and
receive the special-tariff treatment provided for under the FTA
when the methanol is intended for use in producing a synthetic
natural gas or for direct use as a fuel.
LAW AND ANALYSIS:
Merchandise imported into the United States is classified
under the Harmonized Tariff Schedule of the United States
Annotated (HTSUSA). The tariff classification of merchandise
under the HTSUSA is governed by the principles set forth in the
General Rules of Interpretation (GRIs) and, in the absence of
special language or context which otherwise requires, by the
Additional U.S. Rules of Interpretation. The GRIs and the
Additional U.S. Rules of Interpretation are part of the HTSUSA
and are to be considered statutory provisions of law for all
purposes. See Sections 1204(a) and 1204(c) of the Omnibus Trade
and Competitiveness Act of 1988 (19 U.S.C. 1204(a) and 1204(c)).
GRI 1 requires that classification be determined first
according to the terms of the headings of the tariff schedule
(i.e., (1) merchandise is to be classified under the 4-digit
heading that most specifically describes the merchandise; (2)
only 4-digit headings are comparable; and (3) merchandise must
first satisfy the provisions of a 4-digit heading before
consideration is given to classification under a subheading
within this 4-digit heading) and any relative section or chapter
notes and, provided such headings or notes do not otherwise
require, then according to the other GRIs.
GRI 6 prescribes that, for legal purposes, GRIs 1 to 5 shall
govern, mutatis mutandis, classification at subheading levels
within the same heading. Therefore, merchandise is to be
classified at equal subheading levels (i.e., at the same digit
level) within the same 4-digit heading under the subheading that
most specifically describes or identifies the merchandise.
Heading 2905 provides for acyclic alcohols and their
halogenated, sulfonated, nitrated or nitrosated derivatives.
Within that heading, subheading 2905.11 provides for methanol
(methyl alcohol). In turn, within that six-digit international
subheading, there exist two subheadings at the eight-digit
national level that provide for importations of methanol. The
first subheading is 2905.11.10. It provides for methanol that is
"imported only for use in producing synthetic natural gas or for
direct use as a fuel." There is a free rate of duty but one must
comply with the "actual-use" requirements set forth in Additional
U.S. Rule of Interpretation 1(b) to the HTSUSA and Customs
Regulations 10.131 through 10.139. The second subheading is
2905.11.20. It provides for methanol other than that described
in the terms of subheading 2905.11.10. The general rate of duty
for that subheading is 18 percent ad valorem. Pursuant to
Presidential Proclamation 6124 (which became effective as of
April 1, 1990), imports of methanol qualifying for special-tariff
treatment under the FTA and entered under subheading 2905.11.20
do so free of duty.
As indicated above, subheading 2905.11.10 is an "actual-use"
provision whereas subheading 2905.11.20 is a residual provision
(i.e., the merchandise is not specifically or eo nomine provided
for but is nonetheless properly classified under that
provision). In order to derive the benefits of an actual-use
provision, one must comply with the applicable actual-use
requirements. See Additional U.S. Rule of Interpretation 1(b) to
the HTSUSA and Customs Regulations 10.131 through 10.139. If one
chooses not to undertake the actual-use requirements, then entry
of the merchandise should be made under the applicable
alternative provision. Therefore, when an actual-use provision
is involved, an importer, at its option, may choose to enter its
merchandise either (1) under the actual-use provision or (2)
under the applicable alternative provision. In regard to the
instant case, then, an importer of methanol qualifying for
special-tariff treatment under the FTA may enter the methanol
under subheading 2905.11.20 (rather than under subheading
2905.11.10) and receive the special-tariff treatment provided for
under the FTA when the methanol is intended for use in producing
a synthetic natural gas or for direct use as a fuel.
HOLDING:
An importer of methanol qualifying for special-tariff
treatment under the FTA may enter the product under subheading
2905.11.20 and receive the special-tariff treatment provided for
under the FTA when the methanol is intended for use in producing
a synthetic natural gas or for direct use as a fuel.
Sincerely,
John Durant,
Commercial Rulings Division