CLA-2 OT:RR:CTF:TCM H043740 ARM
TARIFF NO: 3905.99.80
Mr. John M. Petersen
Neville Peterson LLP
17 State Street, 19th Floor
New York, NY 10004
RE: Classification of Polyvinyl Alcohol/Sodium Alginate Gel; Reconsideration of New York Ruling Letter N024369, dated April 7, 2008
Dear Mr. Petersen:
This is in reply to your request, of October 28, 2008, on behalf of your client, Kuraray America, Inc., for reconsideration of New York Ruling Letter (NY) N024369, dated April 7, 2008, regarding the classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of Polyvinyl Alcohol (PVA)/Sodium Alginate Gel for use in purifying water.
FACTS:
NY N024369 describes the instant merchandise as follows:
Kuraray PVA-Gel PG-170-S hydrogel beads consist of cross-linked polyvinyl alcohol and sodium alginate (polysaccharide). Composed primarily of polyvinyl alcohol, the hydrogel is highly hydrophilic and has a porous, mesh-like structure with a high affinity for microorganisms. This affinity or adsorption property allows the spherical hydrogel beads with a diameter of 4 millimeters to hold up to 1 billion microorganisms. Microorganisms enter and multiply towards the inner part of the beads where they are entrapped and immobilized. PVA-Gel is used as an alternative to the activated sludge method in the treatment of wastewater.
The beads are manufactured as follows: (1)PVA and sodium alginate are mixed in water in a drop generator vessel and then passed through a nozzle to form gel drops containing polymer (2) the gel drops pass into a gelling vessel containing calcium chloride that converts the sodium alginate from solution into gel, stabilizing the drops and forming beads that encapsulate the polymer. (3) the beads are transferred to a
reactor vessel where the polymer is crosslinked by formaldehyde in combination with sulfuric acid and sodium sulfate acid.
Each PVA hydrogel bead is highly hydrophilic and has a porous, mesh-like structure with a high affinity for microorganisms. This affinity for adsorption allows the spherical hydrogel beads with a diameter of 4 millimeters to hold up to 1 billion microorganisms. Microorganisms enter and multiply towards the inner part of the bead where they are entrapped and immobilized. Because PVA hydrogel has a high moisture content and good oxygen permeability, it provides a favorable habitat for the microorganisms to grow. The concentration of bacteria is then increased, which allows the concentration of bacteria to metabolically treat the wastewater. Because the PVA hydrogel has been insolubilized by chemical cross linking, it is not easily biodegraded.
ISSUE:
Is PVA hydrogel bead a PVA of heading 3905, a water purifier of heading 8417, or a chemical preparation of heading 3824?
LAW AND ANALYSIS:
Classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) 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.
When interpreting and implementing the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. Customs and Border Protection (CBP) believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The following HTSUS provisions are relevant to the classification of this product:
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:
Other:
Other:
Other:
3824.90.92 Other.
* * * * *
3905: Polymers of vinyl acetate or of other vinyl esters, in primary forms; other vinyl polymers in primary forms:
* * *
3905.30.00 Poly(vinyl alcohol), whether or not containing unhydrolyzed acetate groups . . . .
* * *
Other:
3905.91 Copolymers:
3905.91.50 Other . . . .
* * *
3905.99 Other:
3905.99.80 Other. . . . .
* * * * *
8421: Centrifuges, including centrifugal dryers; filtering or purifying machinery and apparatus, for liquids or gases; parts thereof:
Filtering or purifying machinery and apparatus for liquids:
8421.21.00 For filtering or purifying water.
* * * * *
Chapter 39, Note 6(a) states that “In headings 3901 to 3914, the expression "primary forms" applies only to . . . Liquids and pastes, including dispersions (emulsions and suspensions) and solutions . . . .”
The ENs to heading 3905 state, in pertinent part, the following:
This heading covers all vinyl polymers other than those of heading 39.04. A vinyl polymer is one whose monomer has the formula
, where the C?X bond is neither a carbon-carbon bond nor a carbon-hydrogen bond. Polyvinyl ketones, where the C?X bond is a carbon-carbon bond are, therefore, excluded (heading 39.11).
* * * * *
Poly(vinyl alcohol) is usually prepared by the hydrolysis of poly(vinyl acetate). Poly(vinyl alcohol) is available in a number of grades depending upon the content of unhydrolysed vinyl acetate groups. These are excellent emulsifiers and dispersing agents and are used as protective colloids, adhesives, binders and thickeners in paints, pharmaceuticals and cosmetics and in textiles. Fibres produced from poly(vinyl alcohol) are suitable for making underwear, blankets, clothing, etc.
Polyvinyl acetals can be prepared by reacting poly(vinyl alcohol) with an aldehyde such as formaldehyde or butyraldehyde, or by reacting poly(vinyl acetate) with an aldehyde.
Other vinyl polymers include polyvinyl ethers, poly(vinyl carbazole) and poly(vinyl pyrrolidone).
For the classification of polymers (including copolymers), chemically modified polymers and polymer blends, see the General Explanatory Note to this Chapter.
* * * * *
The ENS to heading 8421 state, in pertinent part, the following:
(II) FILTERING OR PURIFYING MACHINERY AND APPARATUS, FOR LIQUIDS OR GASES
Much of the filtration or purification plant of this heading is purely static equipment with no moving parts. The heading covers filters and purifiers of all types (physical or mechanical, chemical, magnetic, electro magnetic, electrostatic, etc.). The heading covers not only large industrial plant, but also filters for internal combustion engines and small domestic appliances. The heading does not, however, include filter funnels, milk strainers, vessels, tanks, etc., simply equipped with metallic gauze or other straining material, nor general purpose vessels, tanks, etc., even if intended for use as filters after insertion of a layer of gravel, sand, charcoal, etc.
In general, filtering machinery and plant of this heading is of two distinct types according to whether it is intended for liquids or gases.
(A) Filtering and purifying machinery, etc., for liquids, including water softeners.
The liquid filters of this group separate solid, fatty, colloidal, etc., particles from a liquid, for example, by passing it through a sheet, membrane or mass of porous material (e.g., cloth, felt, wire cloth, skin, stoneware, porcelain, kieselguhr, sintered metallic powders, asbestos, paper pulp, cellulose, charcoal, animal black, sand). In the treatment of drinking water, some of these materials (e.g., porcelain and charcoal) remove bacteria, etc., in the process of filtration; filters using these materials are therefore sometimes called "water purifiers". Filters are also used to eliminate liquids from materials in the form of a slurry (e.g., from ceramic materials or ore concentrates). The heading covers liquid filters whether of the gravity, suction (or vacuum) or pressure types.
It includes, inter alia :
* * *
(8) Chemical water purifiers, e.g., permutite or zeolite softeners and lime water purifiers.
(9) Electro magnetic water purifiers. In these purifiers the action of an alternating magnetic field prevents the calcareous salts in the water from crystallising and forming deposits on the walls of the tubes; instead, the salts separate as sludges which can readily be removed.
In NY N024369, Customs and Border Protection (“CBP”) classified the PVA-Gel PG-170-S hydrogel beads in subheading 3905.99.80, HTSUS, which provides for “Polymers of vinyl acetate or of other vinyl esters, in primary forms; other vinyl polymers in primary forms: Other: Other” at a rate of duty of 5.3 percent ad valorem. You ask that we revoke NY R04494 in favor of classification in heading 8421, HTSUS, as an apparatus for purifying liquids, or in heading 3824, HTSUS, which provides for other chemical preparations. You also request that we consider classification in other subheadings of heading 3905, HTSUS, as a polyvinyl acetate or copolymer.
Initially, we note that the term “filter” is not defined in the HTSUS or its legislative history. The meaning of a tariff term, a matter of statutory construction, is a question of law. Bausch & Lomb, Inc. v. United States, 148 F.3d 1363, 1366 (Fed.Cir. 1998). When that term is not defined in either the HTSUS or its legislative history, its "correct meaning is its common meaning." Mita Copystar America v. United States, 21 F.3d 1079, 1082 (Fed.Cir. 1994). The common meaning of a term used in commerce is presumed to be the same as its commercial meaning. Simod America Corp. v. United States, 872 F.2d 1572, 1576 (Fed. Cir. 1989). To ascertain that common meaning, a court "may consult dictionaries, scientific authorities, and other reliable information sources" and "lexicographic and other materials." Id.
In C.J. Tower, Inc. v. United States, 27 C.I.T. 793 (Ct. Int'l Trade 2003), the court determined whether a disc or drum filter, used solely in the pulp making process in the papermaking industry, was classified as a filter or purifying apparatus of heading 8421, HTSUS. In so doing, the court noted the following definitions for the term filter:
McGraw-Hill Dictionary of Scientific and Technical Terms, p. 799 (6th ed. 2003)
"porous article or material for separating suspended particulate matter from liquids by passing the liquid through the pores in the filter and sieving out the solids".
Webster's Third New International Dictionary, p. 850 (1993)
"a porous article or mass (as of cloth, paper, or sand) that serves as a medium for separating from a liquid or gas passed through it matter held in suspension or dissolved impurities or coloring matter".
McGraw-Hill Encyclopedia of Science and Technology, V. 7, p. 119 (9th ed. 2002)
The separation of solid particles from a fluid-solids suspension of which they are a part by passage of most of the fluid through a septum or membrane that retains most of the solids on or within itself. The septum is called a filter medium, and the equipment assembly that holds the medium and provides space for the accumulated solids is called a filter. The fluid may be a gas or a liquid. The solid particles may be coarse or very fine, and their concentration in the suspension may be extremely low (a few parts per million) or quite high (>50%). The object of filtration may be to purify the fluid by clarification or to recover clean, fluid-free particles, or both. In most filtrations the solids-fluid separation is not perfect. In general, the closer the approach to perfection, the more costly the filtration; thus the operator of the process cannot justify a more thorough separation than is required.
*** Liquid filters are of two major classes, cake filters and clarifying filters. The former are so called because they separate slurries carrying relatively large amounts of solids. They build up on the filter medium as a visible, removable cake which normally is discharged "dry" (that is, as a moist mass), frequently after being washed in the filter. It is on the surface of this cake that filtration takes place after the first layer is formed on the medium
Van Nostrand's Scientific Encyclopedia, pp. 1146-48 (7th ed. 1989)
A very common requirement of several industries, such as chemical and biologicals manufacturing, food processing, ore processing, and water and waste treatment, is the separation of solids that are suspended in liquids. Filtration is a principal means for effecting such separation …. In filtration, the suspension containing the solids is caused to pass through a porous medium. Numerous filtering media are used, including paper, cloth, and wire cloth. Filtration may be conducted under positive pressure or vacuum.
Id. at 800-801. (See also, Airflow Technology, Inc v. United States, 524 F.3d 1287, 1292; 2008 U.S. App. LEXIS 9165; 30 Int’l Trade Rep. (BNA) 1065 (CAFC, 2008) citing the same text from Webster's Third New International Dictionary, p. 850 (1986)).
The hydrogel beads do not effect filtration as set out in C.J. Tower or in any of the ways described by the EN to heading 8421. The beads are not filtering out particles as a filtering media such as paper, cloth or wire cloth. (see, New York Ruling Letter (NY) F81194, dated January 24, 2000, NY 815060, dated September 28, 1995). The beads are not reacting chemically or electromagnetically with the wastewater to prevent the formation of waste deposits. (see, NY R03334, dated March 15, 2006, NY F89310, dated July 19, 2000, NY I87395, dated October 24, 2002). The PVA hydrogel beads are not incorporated into a machine as imported. They are not encompassed by a cartridge, column or other device for a filtering machine. (see, HQ 960142, dated August 14, 1997, HQ 088828, dated July 3, 1991, HQ 082462, dated November 12, 1999, HQ 966874, dated May 17, 2004). Unlike the products in the rulings cited by you and noted above, the beads themselves are not purifying the wastewater. They are simply providing an environment for microorganisms that, by their respiration, consume the harmful substances in wastewater.
The instant merchandise is created by encapsulating PVA into beads of sodium alginate reacted with calcium chloride and crosslinked with formaldehyde. The EN to heading 3905 confirms that PVA crosslinked with formaldehyde is described by the heading. Chapter 39, Note 6(a) provides for primary forms including dispersions and solutions. Therefore, the fact that the instant merchandise is contained in solution (water) does not effect the classification in heading 3905, HTSUS. Inasmuch as heading 3905, HTSUS, describes the merchandise, it cannot be classified in heading 3824, HTSUS.
You raise the possibility of classification of the PVA gel in subheadings 3905.30.00, HTSUS, or 3905.91.50, HTSUS. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, any related subheading notes and mutatis mutandis, to the GRIs. Subheading Note 1 to heading 3905 directs classification of polymer blends in the same subheading as if they were polymers of the same monomer units.
The merchandise cannot be classified as a PVA of subheading 3905.30.00, HTSUS, because the PVA has been crosslinked with formaldehyde and becomes polyvinyl acetal. Neither can the merchandise be described as a copolymer of subheading 3905.91.50, HTSUS. Copolymers are composed of at least two different monomer unit compositions connected in sequence along the main polymer chain. The instant product consists of polymer chains of repeating polyvinyl acetal monomer units only. By contrast, the rulings you cite are distinguishable in that they contain copolymers with no single monomer unit contributing 95% or more by weight to the total
polymer content. (see NY N016403, dated September 12, 2007, NY D86287, dated January 27, 1999 and NY F84707, dated March 27, 2000).
Hence, by application of GRI 1, the PVA hydrogel beads are classified in heading 3905, HTSUS, specifically in subheading 3905.99.80, HTSUS, which provides for: “Polymers of vinyl acetate or of other vinyl esters, in primary forms; other vinyl polymers in primary forms: Other: Other.”
HOLDING:
By application of GRI 1, the classification of the PVA hydrogel beads is in heading 3905, HTSUS, specifically in subheading 3905.99.80, HTSUS, which provides for: “Polymers of vinyl acetate or of other vinyl esters, in primary forms; other vinyl polymers in primary forms: Other: Other.” The column one general rate of duty is 5.3 percent 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 World Wide Web at www.usitc.gov.
EFFECT ON OTHER RULINGS:
NY N024369, dated April 7, 2008, is affirmed.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division