CLA-2 RR:CR:GC 961975 EAB
Port Director
U.S. Customs Service
605 W. Fourth Avenue
Anchorage, Alaska 995016
Re: Protest 3196-98-100005, magnesium oxide (MgO) crystals
Dear Port Director:
This is our decision on protest 3196-98-100005, timely filed on May 7, 1998, against your decision on the classification under the Harmonized Tariff Schedule of the United States (HTSUS), of merchandise entered in 1996 and 1997.
FACTS:
On various documents associated with the entry process, the merchandise has been described as “FUSED & DEAD-BURNED MAGNESIA” or as “MGO SINGLE CRYSTAL”. It was entered in subheading 2519.90.1000, HTSUS, the eo nomine provision for, inter alia, fused and dead-burned (sintered) magnesia.
Customs Laboratory Report 8-98-40004-001, dated November 25, 1997, described a sample from one of the protested entries as
. . . two colorless discs, one of which is polished and transparent, the other [of] which is neither. Both weigh more than 2.5 grams each [sic]. Laboratory analysis indicates that they are composed of single crystal magnesium oxide. In our opinion, such single crystals may be regarded as “cultured” . . . .
Attached thereto was a patent, in Japanese, and patent abstract information, in English.
The polished and transparent disc is used as a substrate for printed microcircuits used in cellular telecommunications devices. The unpolished and opaque disc is a blank, to be further processed into another substrate. Neither has been etched, coated or imprinted, and protestant assures us that neither one nor any like them is used as an optical crystal.
Customs liquidated the entries in subheading 3824.90.1900, HTSUS, the provision for cultured crystals (other than optical elements of chapter 90), weighing not less than 2.5 grams each, other than in the form of ingots.
On February 2, 1999, a meeting among counsel and the chairman & CEO of the importer/protestant and members of this Office was held in Customs Headquarters. During this meeting, the actual manufacturing process used to obtain the single magnesium oxide (MgO) crystal was discussed at length. In short, crude MgO bearing material is subjected to a controlled melt which drives off impurities and fuses the MgO molecules. As the melt slowly cools and solidifies, the core cools much slower than does the surface. This results in multiple crystals forming on the surface and one large crystal developing at the core. Once the melt has cooled to specification, the outer crystalline, pseudo-granular shell is removed by the process of choice to reveal the large single crystal that will be further worked to yield discs (and rectangles) that are, of course, themselves each, one MgO crystal.
On March 5, 1999, we were provided with samples of the imported goods, other samples of protestant’s merchandise and a supplemental brief in support of classification of the merchandise in either subheading 2519.90.1000, HTSUS, or in subheading 8542.30.0040, HTSUS, the provision in part for “other” monolithic integrated circuits, unmounted. This further submission concerns, in addition to the merchandise that is the subject of this protest, merchandise that is a highly polished, small rectangular piece that is also a single MgO crystal, but one that weighs less than 2.5 grams, and is ultimately used in research and development processes involving micro circuitry (but not as an optical crystal). In the interest of the efficient administration of the tariff schedule, while this is our decision on the protest, we offer guidance on the classification of the sample presented outside of the protest process.
Again, the discs weighing at least 2.5 grams each and the rectangular slides weighing less than 2.5 grams each are single MgO crystals cut from a single MgO crystal made by the controlled melting of a magnesium oxide clinker in an arc furnace.
ISSUE:
Whether highly polished discs or unpolished blanks, each being a single magnesium oxide (MgO) crystal weighing no less than 2.5 grams, not used in optical applications, cut from a much larger single MgO crystal created by the controlled melting in an arc furnace of a magnesium oxide clinker, are classifiable as fused magnesia of chapter 25, as a cultured crystal of chapter 38, as a printed circuit of chapter 85, or as a metal oxide of chapter 28, HTSUS.
LAW AND ANALYSIS:
Merchandise imported into the U.S. is classified under the HTSUS. Tariff classification 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 HTSUS and are to be considered statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in order.
The Explanatory Notes to the Harmonized Commodity Description and Coding System [Explanatory Notes or ENS], including the Subheading Explanatory Notes, although not dispositive or legally binding, provide a commentary on the scope of each heading and certain subheadings of the HTSUS, and are generally indicative of the proper interpretation of such headings and subheadings. See T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
Heading 2519, HTSUS, provides, in part, as follows:
2519 Natural magnesium carbonate (magnesite); fused magnesia; dead-burned (sintered) magnesia, whether or not containing small quantities of other oxides added before sintering; other magnesium oxide, whether or not pure:
2519.10 Natural magnesium carbonate (magnesite)
2519.90 Other:
2519.90.10 Fused magnesia and dead-burned (sintered) magnesia
Legal Note 1, chapter 25, HTSUS, provides as follows:
Except where their context . . . otherwise requires, the headings of this chapter cover only products which are in the crude state or which have been washed [as provided herein], crushed, ground, powdered, levigated, sifted, screened, [or] concentrated by flotation, magnetic separation or other mechanical or physical processes (except crystallization), but not products which have been roasted, calcined, obtained by mixing or subjected to processing beyond that mentioned in each heading [emphasis supplied].
Heading 2825, HTSUS, provides in part as follows:
2825 Hydrazine and hydroxylamine and their inorganic salts; other inorganic bases; other metal oxides, hydroxides and peroxides:
2825.10.0000 Hydrazine and hydroxylamine and their inorganic salts
2825.20.0000 Lithium oxide and hydroxide
.
.
.
2825.90 Other:
2825.90.1000 Beryllium oxide and hydroxide
.
.
.
2825.90.9000 Other
Legal Note 3(a), Chapter 28, provides as follows:
Subject to the provisions of note 1 to section VI, this chapter does not cover:
(a) Sodium chloride or magnesium oxide, whether or not pure, or other products of section V
Generally, metal oxide bearing materials subjected to industrial processes not generally permitted by Legal Note 1, Chapter 25, HTSUS, or not contextually allowed by the terms of a given heading in chapter 25 are not classified in chapter 25, but are frequently classified in Chapter 28, HTSUS. Legal Note 3(a), Chapter 28, HTSUS, expressly prohibits, however, the classification of “magnesium oxide, whether or not pure,” in chapter 28. There is no language here that saves classification in chapter 28 for magnesium oxide that may be in crystalline form, and, thus, the matter of whether or not the crystal would be “cultured” is irrelevant. We find, therefore, that the subject goods, each being a single crystal of MgO, are not classifiable in chapter 28, HTSUS.
Magnesia is magnesium oxide that has been specially processed, either by a relatively low-temperature dehydration of naturally occurring magnesium oxide, or by high-temperature furnacing of the intermediate oxide formed from magnesium carbonate or magnesium hydroxide. See Hawley’s Condensed Chemical Dictionary, 12th Ed., Van Nostrand Reinhold Company, at 716 and 720. Although not generally permitted by Legal Note 1, chapter 25, low-temperature dehydration or high-temperature furnacing of crude magnesium oxide is permissible in the context of heading 2519, which expressly provides for fused and sintered magnesia (as well as “other magnesium oxide, whether or not pure”). Furthermore, Legal Note 2(g), Chapter 25, HTSUS, expressly provides that
This chapter does not cover: . . . Cultured crystals (other than optical elements) weighing not less than 2.5 g each, of sodium chloride or of magnesium oxide, of heading 3824; optical elements of sodium chloride or of magnesium oxide (heading 9001)[.]”
Heading 6815, HTSUS, includes, inter alia, “articles . . . of mineral substances . . . not elsewhere specified or included.” Legal Note 1(a), Chapter 68, HTSUS, provides that the “chapter does not cover: (a) Goods of chapter 25.” The General EN to chapter 68 explains that
This Chapter covers:
(A) Various products of Chapter 25 worked to a degree beyond that permitted by Note 1 to that Chapter.
(B) The products excluded from Chapter 25 by Note 2(e) to that Chapter.
. . .
Most of these products and finished articles are obtained by operations . . . which alter the form rather than the nature of the constituent material. . . . The Chapter also includes certain goods obtained by processes involving a more radical transformation of the original raw material (e.g. fusion . . .).
We believe that the classification scheme presented by the foregoing is as follows: all optical elements of MgO, regardless of size, are to be classified in heading 9001, HTSUS; cultured crystals (other than optical elements) of MgO are to be classified in heading 2519 if they weigh less than 2.5 grams and are not excluded by reason of certain processing to which they have been subjected (Legal Note 1, Chapter 25, HTSUS), but if excluded by such processing, are to be classified in heading 6815, HTSUS; cultured crystals (other than optical elements) of MgO are to be classified in heading 3824 if they weigh at least 2.5 grams. If, therefore, the merchandise at issue was a cultured crystal (other than an optical element) of MgO (heading 9001, HTSUS) weighing less than 2.5 grams and not processed beyond that permitted by Legal Note 1, Chapter 25, HTSUS, then it would be classifiable in subheading 2519.90.1000, HTSUS, as claimed. We find, however, that the merchandise is not such a product because each disc weighs not less than 2.5 grams. We note also that this product is not magnesium oxide, whether or not pure, either in the crude state or simply washed or otherwise processed as allowed by Legal Note 1, Chapter 25, supra, but a cut to shape, highly polished and fully finished product that is used as a substrate in the production of telecommunication micro circuitry. For purposes of our ultimate decision, we note here that we find the unpolished disc, being a single cultured MgO crystal, to be classifiable as the polished and finished disc, pursuant to GRI 2(a), which provides in part that an unfinished good possessing the essential character of its finished counterpart shall be classified as would be the finished good. We find that the merchandise is not classifiable in subheading 2519.90.1000, HTSUS.
Heading 8542 covers electronic integrated circuits and micro assemblies:
8542 Electronic integrated circuits and microassemblies; parts thereof:
Monolithic digital integrated circuits:
8542.12.0000 Cards incorporating electronic integrated circuits ("smart" cards)
8542.13 Metal oxide semiconductors
(MOS technology):
[etc.]
8542.19 Other, including circuits obtained by a combination of bipolar and MOS technologies (BIMOS technology):
[etc.]
8542.30.00 Other monolithic integrated circuits
8542.30.0040 Unmounted chips, dice and wafers
[et seq.]
The scope of the heading encompasses “devices having a high passive and active element or component density, which are regarded as single units.” EN 85.42. The scope of the heading, however, does not extend beyond those articles permitted by the terms of the heading and relative section and chapter notes (GRI 1). On this point, Legal Note 5(b), Chapter 85, HTSUS, provides in part as follows:
5. For the purposes of headings 8541 and 8542:
(a) "Diodes, transistors and similar semiconductor devices" are semiconductor devices the operation of which depends on variations in resistivity on the application of an electric field;
(b) "Electronic integrated circuits and microassemblies" are:
(i) Monolithic integrated circuits in which the circuit elements (diodes, transistors, resistors, capacitors, interconnections, etc.) are created in the mass (essentially) and on the surface of a semiconductor material (doped silicon, for example) and are inseparably associated
Thus, to be classified in subheading 8542.30.0040, HTSUS, as proposed by the protestant, the articles must be “monolithic integrated circuits” within heading 8542, HTSUS, as defined by Legal Note 5(b)(i), Chapter 85. The merchandise at issue is not such a product. The MgO crystal discs under consideration are not circuits, nor do they have any circuit elements, such as those described in the foregoing definition; rather, they are the platform upon which such a circuit may be created. As such, they are not monolithic integrated circuits of heading 8542, HTSUS, nor do they exhibit the essential character of the articles of that heading, such that classification in heading 8542 could be saved by application of GRI 2(a), which provides in part that a reference in a heading to an article shall be taken to include a reference to the article incomplete or unfinished, if it has the essential character of the complete or finished article. Further the subject discs are not parts of heading 8542 (i.e., articles of subheading 8542.90.0000), HTSUS, because it is not established that they are “solely or principally used as a part” of articles of heading 8542. Furthermore, as shown below, there is a specific provision for them, and a provision for parts may not prevail over a specific provision. See Additional U.S. Rule of Interpretation 1(c), HTSUS. We find that the merchandise is not goods of heading 8542, HTSUS.
Heading 3824, HTSUS, provides in part as follows:
3824 Prepared binders for foundry molds or cores; chemical products and preparations of the chemical or allied industries (including those consisting of mixtures of natural products), not elsewhere specified or included; residual products of the chemical or allied industries, not elsewhere specified or included:
3824.10 Prepared binders [etc.]
.
.
.
3824.90 Other:
Cultured crystals (other than optical elements of chapter 90), weighing not less than 2.5 g each:
3824.90.11 In the form of ingots
3824.90.19 Other
Counsel for protestant is of the opinion that the adjective “cultured” is a term of limitation upon “crystal” and that the imported goods are not “cultured crystals” because
. . . the imported fused magnesium oxide crystals are not “grown.” A mass of crystals form as the molten liquid cools and solidifies after the melt process used to manufacture the fused magnesium oxide. The crystals are not uniquely “grown” and the process does not involve the introduction of a foreign nucleating “seed.”
The ENs offer no guidance on the scope of the term “cultured crystals” used in subheadings 3824.90.11 and 3824.90.19, HTSUS. We note, however, from the McGraw-Hill Encyclopedia of Science and Technology, Crystal Growth: Growth Methods:
The advent of semiconductor-based technology generated a demand for large, high-quality single crystals. . . . Thin, multilayered single-crystal structures . . . are often required.
Bulk single crystals are usually grown from a liquid phase. . . .
The most important bulk crystal growth technique is the crystal-pulling or Czochralski method, in which a rotating seed crystal is dipped into the melt. Rotation reduces radial temperature gradients, and slow withdrawal of the rotating seed results in growth of a cylinder of single-crystal material. The conditions for optimum growth vary widely, and pulling rates range up to a few inches per hour. . . .
There are several other variations of the melt-growth technique. One of them is the zone-refining method, in which a narrow molten region is passed through a solid rod of single crystal or polycrystalline material. Another is the Bridgman technique, in which single-crystal growth is achieved for some materials by moving the melt through a temperature gradient. Generally the container has a restricted region where the first solidification takes place as the liquidus temperature moves past it. An initially formed crystallite in that region propagates with the moving liquidus front, and a single crystal consisting of the entire volume of the melt can result. . . .
We find that the articles making up the imported merchandise are each a single MgO crystal that is a “cultured crystal” as that phrase is commonly and commercially understood, and that the articles, weighing no less than 2.5 grams each and not used as optical elements, are described by the terms of subheading 3824.90.19, HTSUS.
As to the articles outside the scope of this protest decision but submitted as samples to this Office, i.e., the non-optical, single cultured magnesium oxide (MgO) crystal rectangular slides each weighing less than 2.5 grams, we note that the HTSUS treats magnesium oxide with a degree of particularity and uniqueness separate from other metal oxides and similar mineral substances. In view of that particular treatment, we are presently inclined to believe that each MgO crystal slide has been so processed as to be beyond the scope of heading 2519, and may well be classified in heading 6815, HTSUS. This statement is not issued pursuant to 19 C.F.R Part 174 or 177 (Customs Regulations, Part 174 or 177), and is not binding.
HOLDING:
Polished and unpolished discs not used in optical applications, each consisting of a single magnesium oxide (MgO) crystal weighing no less than 2.5 grams, cut from a much larger single MgO crystal created by the controlled melting of a magnesium oxide clinker in an arc furnace, are classifiable in subheading 3824.90.19, HTSUS, the provision for cultured crystals, other than optical elements of chapter 90, weighing not less than 2.5 grams each.
The protest should be DENIED. In accordance with section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1992, Subject: Revised Protest Directive, 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.
Sixty days from the date of this decision, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
[Marvin Amernick, for]
John A. Durant, Director Commercial Rulings Division