CLA-2 OT:RR:CTF:TCM H122250 AMM
U.S. Customs and Border Protection
Pembina Service Port
10980 Hwy 29
Pembina, North Dakota 58271
RE: Tariff classification of two PVC laminated textile fabrics; Protest Number 3401-2010-100026
Dear Port Director:
This letter is in reply to protest, and application for further review (AFR), number 3401-2010-100026, dated June 24, 2010, filed on behalf of Inland Plastics, Ltd. (Inland Plastics), against U.S. Customs and Border Protection’s (CBP) reclassification and subsequent liquidation of two entries of poly-vinyl chloride plastic (PVC) laminated textile fabrics.
FACTS:
This protest pertains to two entries for PVC laminated polyester fabrics. The first entry took place on February 24, 2009, and was liquidated on December 27, 2009. The second took place on March 9, 2009, and was liquidated on January 8, 2010. Two different products are described in each entry, namely Style H1850 and Style H2250. Both styles consist of a woven polyester scrim with a PVC coating.
Inland Plastics has confirmed, in their letter to CBP dated February 14, 2011, that Style H1850 (as identified in the entry documents) is identical to Style IP1850H (as identified in the manufacturing specifications included with the protest). Also, in that letter, they have confirmed that Style H2250 (as identified in the entry documents) is identical to Style 2250H (as identified in the manufacturing specifications included with the protest).
The petitioner alleges that, based on the manufacturing specifications included with the protest documents, the overall weight of Style IP1850H is 18 ounces per square yard (oz./sq.yd.), and the weight of the textile is 5.2 oz./sq.yd. Thus, Style IP1850H allegedly contains 71.1% PVC by weight. The petitioner also alleges that the overall weight of Style 2250H is 22 ounces per square yard (oz./sq.yd.), and the weight of the textile is 6.0 oz./sq.yd. Thus, Style H2250 allegedly contains 72.7% PVC by weight. Both products contain only one type of textile fiber, namely polyester, which is a man-made fabric. No samples from either entry were retained by the port. No laboratory test data was provided.
The subject merchandise was entered under subheading 3921.90.11, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Other plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Products with textile components in which man-made fibers predominate by weight over any other single textile fiber: Over 70 percent by weight of plastics”. The entries identified above for the IP1850H and 2250H products were liquidated under subheading 3921.90.19, HTSUS, which provides for “Other plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Other: Other”, in accordance with New York Ruling Letter (NY) N035975, dated September 17, 2008.
ISSUE:
What is the correct classification of the subject PVC coated textile products at issue?
LAW AND ANALYSIS:
Initially we note that the matter is protestable under 19 U.S.C. §1514(a)(2) as a decision on classification and the rate and amount of duties chargeable. The protest was timely filed on June 24, 2010, within 180 days of liquidation, pursuant to 19 U.S.C. §1514(c)(3).
Further review of Protest 3401-2010-100026 was properly accorded to protestant pursuant to 19 C.F.R. §174.24. Specifically, in accordance with Section 174.24(c), the decision against which the protest was filed involves matters previously ruled upon by the Commissioner of Customs or his designee or by the Customs courts but facts are alleged or legal arguments presented which were not considered at the time of the original ruling.
Merchandise imported into the United States 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 requires otherwise, 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.
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.
The 2009 HTSUS provisions under consideration are as follows:
3921 Other plates, sheets, film, foil and strip, of plastics:
3921.90 Other:
Combined with textile materials and weighing not more than 1.492 kg/m2:
Products with textile components in which man-made fibers predominate by weight over any other single textile fiber:
3921.90.11 Over 70% percent by weight of plastics
3921.90.15 Other
3921.90.19 Other:
Note 10 to Chapter 39, HTSUS, states, in pertinent part:
In headings 3920 and 3921, the expression ‘plates, sheets, film, foil and strip’ applies only to plates, sheets, film, foil and strip (other than those of chapter 54) and to blocks of regular geometric shape, whether or not printed or otherwise surface-worked, uncut or cut into rectangles (including squares) but not further worked (even if when so cut they become articles ready for use).
There is no dispute that the instant merchandise is classified in heading 3921, HTSUS. Rather, the dispute is the proper 8-digit national tariff rate that is applicable. As a result, GRI 6 applies.
GRI 6 states: For legal purposes, 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 subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
The issue in this case is the interpretation of the phrase “products with textile components in which man-made fibers predominate by weight over any other single textile fiber”, as found in heading 3921.90, HTSUS.
NY N035975, dated September 17, 2008, was issued to Inland Plastics for the products at issue in this protest, namely Styles IP1850H and 2250H. This ruling interpreted the phrase “predominate by weight over any other single fiber” to apply only to material of at least two distinct types of fibers. To be included under 3921.90.11 HTSUS, there must be at least two types of fibers in the product. The products at issue only contain one type of fiber, namely polyester fiber. Therefore, the products were not classified under subheading 3921.90.11, HTSUS, and were instead classified under subheading 3921.90.19, HTSUS, as plastic sheet combined with textile materials other than those with man-made fibers which predominate by weight over any other single textile fiber.
The reasoning of NY N035975 was based on an interpretation of the word “predominate” found in Semperit Industrial Products, Inc. v. United States, 855 F.Supp. 1292 (Ct. Int’l. Trade 1994). In that case, the Court of International Trade interpreted subheading 4010.91.15, HTSUS (1994), which reads: “Conveyor or transmission belts or belting, of vulcanized rubber: Other: Of a width exceeding 20 cm: Combined with textile materials: With textile components in which man-made fibers predominate by weight over any other single textile fiber.” The Court interpreted the word “predominate” to mean “incorporat[e] a comparison between two or more entities and a determination that one of the entities outweighs the other.” Semperit, at 1298. Thus, because the product at issue in Semperit contained only man-made fibers, it could not be classified under 4010.91.15, HTSUS (1994). NY N035975 extended the holding of Semperit to encompass subheading 3921.90.11, HTSUS, because the language of the two headings is identical.
The petitioner alleges that recent case law overturns the reasoning of NY N035975. In Value Vinyls, Inc. v. United States, 31 C.I.T. 173, (Ct. Int’l Trade 2007), the Court of International Trade interpreted the word “predominate” as it appears in subheading 3921.90.11, HTSUS. Value Vinyls, Inc. (Value Vinyls) imported a product consisting of polyester fiber coated with PVC. CBP classified the goods under subheading 3921.90.19, HTSUS. See NY D85950, dated December 22, 1998. Value Vinyls protested, and CBP denied the protest. See Headquarters Ruling Letter (HQ) 963747, dated June 25, 2001; See also HQ 955343, dated October 12, 1994. Value Vinyls then challenged CBP’s classification in the Court of International Trade. The Court held for Value Vinyls, classifying the products under subheading 3921.90.11, HTSUS. Value Vinyls, 31 C.I.T. at 180. The Federal Circuit later affirmed that ruling, concluding that “the court correctly ruled that subheading 3921.90.11 embraces products whose textile component is made wholly of man-made fibers, and therefore applies to Value Vinyls’ goods.” Value Vinyls, Inc. v. United States, 568 F.3d 1374, 1380 (Fed. Cir. 2009).
The products at issue in Value Vinyls are similar to the products at issue in the instant case. Both products consist of a polyester textile coated with PVC. According to Value Vinyls, the language of 3921.90.11, HTSUS, encompasses products whose textile component contains only one man-made fiber. Thus, NY N035975 is overruled by operation of law, and the petitioner is correct in that classification of the instant products must proceed in accordance with the Federal Circuit’s Value Vinyls opinion.
The instant products, Styles IP1850H and 2250H, are sheets of PVC laminated polyester fabric. CBP agrees that both products contain less than 1.492kg/m2 of polyester. Because there is one type of man-made fiber and no natural fiber in the instant products, the Value Vinyls case prohibits classification under subheading 3921.90.19, HTSUS. Thus, classification in the competing subheadings at GRI 6 turns on whether the instant products contain over 70% by weight of plastics.
No lab reports or test data were submitted by the petitioner in support of their position that the products contain over 70% by weight of PVC. Conversations with the Pembina Service Port indicate that no samples were taken from the entries, and that the products which are the subject of the instant protest have already entered the normal stream of commerce.
The petitioner has submitted manufacturing specifications along with the protest in support of their position. These specifications indicate the weight of fabric to be used during the manufacturing process, and specify the final overall weight. From those numbers, the importer reasons that Style IP1850H contains 71.1% by weight of PVC and that Style 2250H contains 72.7% by weight of PVC. However, the manufacturing specifications also include the following disclaimer:
We believe this information is the best currently available on the subject. We make no guarantee of results and assume no obligation or liability in connection with this information. It is offered as possible helpful suggestion in any experimentation you may care to undertake along these lines.
As such, the petitioner has not submitted evidence of the actual percentage by weight of PVC. Because no proof has been submitted that the instant products contain over 70% by weight of plastic, and it is impossible to obtain samples for testing from the products actually entered, the merchandise entered in connection with Protest Number 3401-2010-100026 cannot be classified under subheading 3921.90.11, HTSUS. Thus, it falls to be classified under subheading 3921.90.15, HTSUS, which provides for “Other plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Products with textile components in which man-made fibers predominate by weight over any other single textile fiber: Other”.
HOLDING:
By application of GRI 6, Inland Plastic’s Style IP1850H and 2250H products which are the subject of protest number 3401-2010-100026 are classified in heading 3921, HTSUS, specifically under subheading 3921.90.15, HTSUS, which provides for: “Other plates, sheets, film, foil and strip, of plastics: Other: Combined with textile materials and weighing not more than 1.492 kg/m2: Products with textile components in which man-made fibers predominate by weight over any other single textile fiber: Other”. The column one, general rate of duty is 6.3% ad valorem.
Since the rate of duty under the classification indicated above is more than the liquidated rate, you are instructed to DENY the protest in full.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter.
Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision Regulations and Rulings of the Office of International Trade will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
We also note that NY N035975, dated September 17, 2008, NY D85950, dated December 22, 1998, HQ 963747, dated June 25, 2001, and HQ 955343, dated October 12, 1994, are revoked by operation of law in accordance with the Federal Circuit’s decision in Value Vinyls, Inc. v. United States, 568 F.3d 1374 (Fed. Cir. 2009).
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division