CLA-2 OT:RR:CTF:TCM H100675 IOR/LWF
Daniel J. Gluck
Simon Gluck Kane LLP
One Penn Plaza
250 West 34th Street, Suite 4615
New York, NY 10119
RE: Request for Reconsideration of New York Ruling Letter N073512; Classification of cast iron ring carriers, also known as inserts, for use in spark-ignition engine pistons
Dear Mr. Gluck:
On September 24, 2009, U.S. Customs and Border Protection (“CBP”) issued New York Ruling Letter (“NY”) N073512 to you on behalf of Karl Schmidt Unisia (“KUS”), classifying cast iron ring carriers, also known as inserts, for use in spark-ignition engine pistons (“ring carriers”) under subheading 8409.91.50, of the Harmonized Tariff Schedule of the United States (“HTSUS”), which provides for “Parts suitable for use solely or principally with the engines of heading 8407 or 8408: Other: Suitable for use solely or principally with spark-ignition internal combustion piston engines (including rotary engines): Other: For vehicles of subheading 8701.20, or heading 8702,8703 or 8704: Other.” CBP has been provided additional information regarding the pre and post-importation processing of the subject ring carriers. Accordingly, we have reviewed NY N073512 and find it to be incorrect for the reasons set forth below.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. §1625(c)(1)), as amended by section 623 of Title VI, notice of the proposed action was published in the Customs Bulletin, Vol. 50, No. 23, on June 23, 2016. No comments were received in response to the notice.
FACTS:
The subject ring carriers are round in shape, smooth and machine finished on all sides. They are imported with or without ledges depending on the type of piston with which the item is designed to be used. In ruling letter NY N073512, CBP described the subject merchandise as follows:
The item under consideration has been identified as a ring carrier specifically designed to be installed on the “Marathon Engine.” The Marathon Engine is a unique, long life, spark ignition engine designed to be run continuously for long periods of time. You state in your request that the Marathon Engine can run “24 hours a day, 7 days a week, for 4,000 continuous hours.”
You state that this ring carrier is made of cast iron with the following metallurgical profile:
Carbon 2.2-3.0%
Silicon 1.5-2.5%
Manganese 0.8-1.5%
Nickel 13.5-17.0%
Phosphorus =0.1
Sulfur <0.1
Chromium 1.0-1.6%
Copper 5.0-7.0%
Iron Remainder (68-75.8%)
The ring carrier has an outer diameter of approximately 80mm, an inner diameter of 60mm and a thickness of 5mm.
The ring carrier is designed to be incorporated as part of the piston, and is used in the casting process. Prior to installation the ring carrier will be heat treated and bead blasted, which are not considered to be major finishing operations.
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Additionally, in Protest No. 3901-09-100819, filed June 5, 2009, KUS provided a detailed description of a substantially similar ring carrier identified as the “Ni-resist ring carrier.” Via email dated January 6, 2016, you have confirmed that the following description of the manufacture and pre-importation processing of the Ni-resist ring carrier, originally submitted in support of Protest No. 3901-09-100819, is equally applicable to the subject Marathon engine ring carrier:
The piston ring carriers are cast by pouring the liquid ni-resist alloy into a centrifugal casting machine. The casted circular tubes are subjected only to turning in a lathe until it meets a rough estimation of the specific outside dimension. Once the circular tubes are allowed to cool, the cast iron “tubes” are then sliced into rings to the proper size. The rings are then cleaned and packaged for shipping. The turning, cooling, slicing and cleaning of the piston ring carriers are processes and operations that are all integral to the casting process; with each operation designed to prepare the piston ring carriers to ultimately allow the piston ring carrier to be cast with the piston casting mold. Any “machining” or cleaning is done so as to allow the piston ring carrier to locate itself and to fit within the piston casting mold, the finishing machinery.
***
The carriers are not machined other than to remove excess material in order to obtain a rough final outside dimension per print specifications.
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CBP received a letter dated October 14, 2009 from your office on behalf of your client KUS in support of Protest No. 3901-09-100819. In that letter you stated that the decision in ruling letter NY N073512 involving the subject ring carriers (also referred to as “inserts” within the trade industry) was incorrect and that you intended to appeal that ruling. In your submission dated October 14, 2009, you described the post-importation finishing treatment of the imported “inserts” as follows:
After importation, the cast iron inserts are heat treated and then shot blasted. However more is done to the insert. The heat treatment and shot blasting operations prepare the cast iron inserts for the first significant post-importation operation, the process of alfinization. Alfinization is a process that prepares the cast iron inserts for bonding to the base piston alloy. In the alfinization process, the cast iron insert is completely submerged into a temperature-controlled, aluminum-silicon bath for a prescribed period of time. In the aluminum-silicon bath, aluminum atoms diffuse into the surface of the cast iron and completely change the surface composition, microstructure and properties of the cast iron insert. The newly-formed intermetallic alloy is necessary for the manufacture of the piston. This iron-aluminum alloy serves as a “glue” that enable the cast iron insert to fasten itself to the base piston alloy, thus creating a strong metallurgical bond. Without this metallurgical bond that results from the alfinization process, the cast iron insert cannot be bonded to or locate itself in its essential position in the piston, nor will it withstand the extreme conditions within the engine.
***
The second significant post-importation operation that the cast iron inserts must undergo is the final machining process. As KUS is largely responsible for piston design, one of the most critical design features on the piston is the shape of the top groove on the cast iron inserts, which is machined at KUS’ domestic facility, post-importation. In high-pressure engines, the top ring groove is lovated within the cast iron insert. [Footnote omitted]. The geometry of the top ring groove on the cast iron insert is critical for the combustion process which is measured by emission types and levels, oil-consumption and blow-by. The top ring groove must support the critical top ring, which is responsible for generating the high cylinder pressures immediately prior to combustion. Without the proper geometry and the specific grooving and finishing of the cast iron insert, which is different for every engine, the cast iron inserts are useless.
When the cast iron insert undergoes the final machining process, an average of 50% of the cast iron insert is removed in the process. In other words, only 50% of the cast iron insert remains from the original imported cast iron insert. (Emphasis original).
***
The term “ring carrier” or “piston ring carrier” is used loosely within the industry. However, the articles are truly “cast iron inserts” upon importation and then become ring carriers after the articles are processed through heat treating, shot blasting, alfinization and then finally machined to the specific size necessary to be cast with the piston.
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KUS therefore asserts that as imported, the cast iron inserts are not advanced beyond cleaning and machining, as described in the text of subheadings 8404.91.10 or 8409.99.10, HTSUS. Our own review indicates that as imported, the inserts are in the necessary round shape and finished by machining on all sides. They are imported with and without inner “ledges” depending on the characteristics of the piston for which they are designed to be used, as well as the characteristics of the mold for said pistons.
ISSUE:
Whether cast iron ring carriers, also known as inserts, for use in spark-ignition engine pistons are classifiable under subheading 8409.91.10, HTSUS, as cast iron parts not advanced beyond cleaning, and machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery, or under subheading 8409.91.99, HTSUS, as other parts.
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). 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 2 through 6 may then be applied in order.
GRI 6 provides that the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only those subheadings at the same level are comparable.
The 2016 HTSUS provisions under consideration are as follows:
8409 Parts suitable for use solely or principally with the engines of heading 8407 or 8408:
Other:
8409.91 Suitable for use solely or principally with spark-ignition internal combustion piston engines (including rotary engines):
8409.91.10 Cast-iron parts, not advanced beyond cleaning, and machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery
Other:
8409.91.99 Other
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The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While not legally binding or dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
There is no dispute that by application of GRI 1, the subject ring carriers are classified in heading 8409, HTSUS, which provides for: “Parts suitable for use solely or principally with engines of heading 8407 or 8408.” There is also no dispute that the subject parts are classified in subheading 8409.91, HTSUS, as parts “suitable for use solely or principally with spark-ignition internal combustion piston engines (including rotary engines). At issue is classification at the eight-digit level by application of GRI 6. Specifically, resolution of this matter rests upon whether the subject merchandise is advanced beyond cleaning, and machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery.
According to the pre-importation processing description, the turning and cooling operations are integral to the casting process, and the slicing and cleaning of the piston ring carriers are processes and operations that at most, prepare and permit the piston ring carriers to be cast with the piston casting mold, the finishing machinery. See ruling letter HQ 954989, dated September 28, 1993, which found that processing integral to the casting process did not constitute an advancement beyond cleaning for the purposes of subheading 8409.99.10, HTSUS. Consequently, while the description of the post-importation processing operation does not indicate whether the merchandise, as imported, was advanced beyond what is permitted in subheading 8409.91.10, HTSUS, those post-importation processes and finishing machinery descriptions are relevant to the classification determination of the ring carriers.
Upon examination of the condition of the ring carriers at the time of importation and the subsequent post-importation processes performed on the merchandise, CBP finds that the imported articles were not advanced beyond cleaning, and they were machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery. Accordingly, the ring carriers are fully described by the terms of subheading 8409.91.10, HTSUS, and are therefore classifiable in subheading 8409.91.10, by application of GRI 6 and GRI 1.
HOLDING:
By application of GRI 1, the ring carriers are classified under heading 8409, HTSUS. Specifically, by application of GRI 6 and GRI 1, they are classified in subheading 8409.91.10, HTSUS, which provides for “Parts suitable for use solely or principally with engines of heading 8407 or 8408: Other: Suitable for use solely or principally with spark-ignition internal combustion piston engines (including rotary engines): Cast-iron parts, not advanced beyond cleaning and machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery.” The 2016 column one, general rate of duty is Free.
Duty rates are provided for convenience only 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 http://www.usitc.gov.
EFFECT ON OTHER RULINGS:
In accordance with the above analysis, NY N073512, dated September 24, 2009, is hereby REVOKED.
In accordance with 19 U.S.C. §1625(c), this ruling will become effective 60 days after publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division