HQ 965250
NOVEMBER 20 2001
CLA-2 RR:CR:GC 965250 JAS
Juan B. Caballero
Martin, Drought & Torres
1111 First City Bank Tower
Mcallen, TX 78501
RE: HQ 557046 Modified; Magnesium Anodes for Cathodic Protection
Dear Mr. Caballero:
In HQ 557046, issued to you on May 17, 1993, on behalf of Thermal Reduction Company, certain anodes of cast alloy magnesium, products of Mexico, were held to be classifiable in provisions of heading 8104, Harmonized Tariff Schedule of the United States (HTSUS), as unwrought magnesium, depending on the percent content of magnesium, by weight. As products of Mexico, the anodes were also found to be eligible for duty-free treatment under the Generalized System of Preferences (GSP), upon compliance with applicable laws and Customs regulations.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. 1625(c)), as
amended by section 623 of Title VI (Customs Modernization) of the North
American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107
Stat. 2057, 2186 (1993), notice of the proposed modification of HQ 557046
was published on October 10, 2001, in the Customs Bulletin, Volume 35,
Number 41. Two comments were received in response to that notice, both
favoring Customs proposal. The commenters made factual and legal
arguments for the conclusion that cast magnesium alloy ingots for use in
cathodic protection systems are electrical machines and apparatus of
heading 8543. A relevant legal note precludes goods of Chapter 85 from
classification in Chapter 81. All factual and legal issues relevant to the
conclusion will be more fully discussed in this ruling.
- 2 -
FACTS:
The facts in HQ 557046 indicate that 99.8 percent by weight magnesium is mixed with lime or other fluxing agents, alloyed with manganese, zinc and aluminum in specified proportions, then cast into ingots. Some ingots are sold directly while others are designated for further processing into anodes for cathodic protection. This is a process that electrolytically restricts the development of rust and corrosion in underground storage tanks, piping systems, ships’ hulls and above-ground applications where high levels of moisture are found. Ingots for this application are melted and poured into molds in a variety of desired shapes the anode may take. A preheated steel rod is placed in the center of the mold and the molten magnesium poured around it, with only the tip of the rod showing. The resulting article is removed from the mold, rough edges trimmed, and the surfaces smoothed by burnishing.
After importation, a cable or wire connects the anode to the object being protected, the cathode. The magnesium/steel anode has a large enough natural voltage difference to independently produce an electrical current flow. Upon receiving current, negatively charged ions flow from the anode to the tank, pipeline or other object being protected, which serves as the cathode. This phenomenon initiates the buildup of a protective alkali layer on the cathode, thus arresting the buildup of corrosion on its surface, while gradually oxidizing or eroding the anode in the process.
The HTSUS provisions under consideration are as follows:
Magnesium and articles thereof, including waste and scrap:
Unwrought magnesium:
Containing at least 99.8 percent by weight of magnesium
8104.19.00 Other
8104.90.00 Other
- 3 -
* * * * *
8543 Electrical machines and apparatus, having individual functions, not specified or included elsewhere [in chapter 84]; parts thereof:
8543.30.00 Machines and apparatus for electroplating, electrolysis or electrophoresis:
Other machines and apparatus:
8543.89.96 Other
Parts:
8543.90.88 Other
ISSUE:
Whether magnesium anodes for use in sacrificial cathodic protection systems are unwrought forms of magnesium of heading 8104, machines and apparatus for electrolysis of heading 8543, or parts of such apparatus.
LAW AND ANALYSIS:
Under General Rule of Interpretation (GRI) 1, Harmonized Tariff Schedule of the United States (HTSUS), goods are to be classified according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. Though not dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS. Customs believes the ENs should always be consulted. See T.D. 89-80. 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
Goods that are identifiable as parts of machines or apparatus of chapters 84 or 85 are classifiable in accordance with Section XVI, Note 2, HTSUS. Note 2(a) states that parts which are goods included either in chapter 84 or in chapter 85 are in all cases to be classified in their respective headings. Note 2(b) states that other parts are to be classified with the machines with which they are solely or principally used, including machines of heading 8543. The classification
- 4 -
expressed in HQ 557046 was based on the fact that anodes are among the manufactured primary forms of metal listed in the Section XV, Additional U.S. Note 1, HTSUS, definition of the term “unwrought.” Customs was of the mistaken belief that the magnesium anodes at issue were within this definition. Clearly, molten magnesium cast around a steel rod does not qualify as a “form of metal” of the kind contemplated by Note 1.
Moreover, heading 8104 is in Section XV, HTSUS. Section XV, Note 1(f), HTSUS, excludes articles of Section XVI (machinery, mechanical appliances and electrical goods). In this respect, the ENs on p. 1518 state, among other things, that heading 8543, electrical machines and apparatus having individual functions, not specified or included elsewhere in [chapter 85], covers all electrical apparatus not falling in any other heading of chapter 85, nor excluded by an applicable legal note, or covered more specifically by a heading of any other chapter of the
Nomenclature. Most of the appliances of heading 8543 consist of an assembly of electrical goods or parts (valves, transformers, capacitors, chokes, resistors, etc.) operating wholly electrically. It is now clear that HQ 557046 did not give sufficient consideration to the electrical nature of the magnesium anodes the subject of that ruling. The magnesium ingots from which the anodes at issue came were alloyed and fluxed to impart certain efficiency and capacitance required of impressed current anodes. However, the presence of the steel rod in combination with the magnesium ensures the requisite electrochemical properties for this application.
We are satisfied that cast alloy magnesium anodes, as described, qualify as goods of heading 8543. It is important to note, however, that two common types of cathodic protection systems exist, impressed current and sacrificial. Both types of cathodic protection may be described as an electro-chemical process, a galvanic process or as electrolysis. The first type, impressed current cathodic protection, involves the application of an external current to operate. Cast magnesium anodes used with impressed current cathodic protection systems are connected to the external power source after importation. In such cases, the magnesium anodes would be considered parts solely or principally used with electrical machines and apparatus, and classifiable in subheading 8543.90.88, HTSUS. The second type occurs when one metal is coupled, usually through a metallic wire, to a more reactive (anodic) metal. This connection is referred to as a galvanic couple. The anode material must have a large enough natural voltage difference to produce an electrical flow through the wire to the cathode. No outside power is required for this system to be effective. The facts in HQ 557046 specifically stated that the anodes at issue were finished products which are buried in the ground and connected to underground pipes to
- 5 -
prevent their oxidation. Such anodes are for use in sacrificial cathodic protection systems and would be considered apparatus for electroplating, electrolysis or electrophoresis provided for in subheading 8543.30.00.
HOLDING:
Under the authority of GRI 1 and Section XVI, Note 2(a), HTSUS, the cast magnesium alloy anodes, as described, are provided for in heading 8543. They are classifiable in subheading 8543.30.00, HTSUS.
EFFECT ON OTHER RULINGS:
HQ 557046, dated May 17, 1993, is modified as to classification. In accordance with 19 U.S.C. 1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
John Durant, Director
Commercial Rulings Division