CLA–2 OT:RR:CTF:TCM H266971 NCD
Demetrius D. Jones
Yusen Global Logistics
691 Airport S. Parkway
College Park, GA 30349
Re: Revocation of HQ H055635, dated November 23, 2009, HQ H055636, dated November 23, 2009, HQ H031396, dated January 5, 2010, and NY N121378, dated September 30, 2010; Classification of photomask pellicles
Dear Ms. Jones:
This is in reference Headquarters Ruling Letter (HQ) H055635, issued to you on November 23, 2009, involving classification of photomask pellicles under the Harmonized Tariff Schedule of the United States (HTSUS). We have reviewed HQ H055635, determined that it is incorrect, and, for the reasons set forth below, are revoking that ruling.
We have also reviewed HQ H055636, dated November 23, 2009, HQ H031396, dated January 5, 2010, and New York Ruling Letter (NY) N121378, dated September 30, 2010, all of which similarly involve classification of photomask pellicles under the HTSUS. As with HQ H055635, we have determined that those rulings are incorrect and are accordingly revoking them.
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. 33, on August 17, 2016. One comment opposing the proposed action, submitted by Intel Corp. (“Intel”), was received. Intel’s comment will be addressed in this decision.
FACTS:
At issue in HQ H055635, HQ H055636, HQ H031396, and NY N121378 alike are photomask pellicles, which consist of ultra-thin plastic films mounted to frames of various materials. See Semiconductor Equip. and Materials Int’l, SEMI International Standards: Compilation of Terms 172 (2008) (defining “pellicle”). The frames of the pellicles at issue in HQ H055635 and NY N121378 are of aluminum alloy, and the frames of the pellicles at issue in HQ H055636 are of plastic. The material of the pellicle frames in HQ H031396 is not identified in the ruling, but our research indicates that this material is aluminum alloy. See U.S. Patent No. 5,834,143 (issued Nov. 10, 1998).
Pellicles function as protective covers for photomasks, which are quartz substrates onto which unique circuitry patterns have been etched. When placed in a photolithography device such as a stepper or aligner, a photomask filters ultraviolet light projected by the device onto an underlying wafer, to the effect that the patterns displayed on the wafer correspond to those etched onto the photomask. These patterns are subsequently etched into the wafer, which is then incorporated into an integrated circuit.
A photomask pellicle is effectively joined with a photomask by the adhesion of its frame to the photomask substrate (see Figure 1 below). When so attached, a pellicle seals out dust and other contaminants from the photomask, thereby preventing potential distortion of the patterns projected upon the underlying wafers. Its optical properties are such that most of the ultraviolet light projected by the photolithography device passes through evenly, and only a minimal portion of this light is reflected. Notably, the pellicle attaches only to the photomask, and is not joined with the photolithography equipment with which the photomask is used.
Figure 1
The photomask pellicles at issue in HQ H055635, HQ H055636, HQ H031396, and NY N121378 were classified by U.S. Customs and Border Protection (CBP) in heading 8486, HTSUS. They were specifically classified in subheading 8486.90.00, HTSUS, which provides for: “Machines and apparatus of a kind used solely or principally for the manufacture of semiconductor boules or wafers, semiconductor devices, electronic integrated circuits or flat panel displays; machines and apparatus specified in Note 9 (C) to this chapter; parts and accessories: Parts and accessories.”
ISSUE:
Whether the subject photomask pellicles are classified as “other articles of plastic” in heading 3926, HTSUS, as “other articles of aluminum” in heading 7616, HTSUS, or as “parts of machines and apparatus of a kind used solely for the manufacture of electronic integrated circuits” in heading 8486, HTSUS.
LAW AND ANALYSIS:
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 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 their appropriate order. GRI 3 governs the classification of goods that are prima facie classifiable in two or more headings, including, inter alia, composite goods. GRI 3(b) provides, in relevant part, that “composite goods consisting of different materials or made up of different components…shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.”
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs), constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of the headings. It is CBP’s practice to consult, whenever possible, the terms of the ENs when interpreting the HTSUS. See T.D. 89–80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The 2016 HTSUS provisions under consideration are as follows:
3926 Other articles of plastics and articles of other materials of headings 3901 to 3914:
3926.90 Other:
3926.90.99 Other
7616 Other articles of aluminum:
Other:
7616.99 Other:
7616.99.50 Other
8486 Machines and apparatus of a kind used solely or principally for the manufacture of semiconductor boules or wafers, semiconductor devices, electronic integrated circuits or flat panel displays; machines and apparatus specified in Note 9 (C) to this chapter; parts and accessories:
8486.90.00 Parts and accessories
As stated above, the subject photomask pellicles in the rulings at issue were classified in heading 8486, HTSUS, which provides, inter alia, for parts of machines and apparatus of a kind used solely for the manufacture of electronic integrated circuits. EN 84.86 provides, in relevant part, as follows:
(B) MACHINES AND APPARATUS FOR THE MANUFACTURE OF SEMICONDUCTOR DEVICES OR OF ELECTRONIC INTEGRATED CIRCUITS
This group covers machines and apparatus for the manufacture of semiconductor devices or of electronic integrated circuits such as:
***
Lithography equipment, which transfer the circuit designs to the photoresist-coated surface of the semiconductor wafer such as:
***
Equipment for exposing the photoresist coated wafer with circuit design (or a part thereof):
Using a mask or reticle and exposing the photoresist to light (generally ultraviolet) or, in some instances, X-rays:
***
Scanning aligners, which use projection techniques to expose a continuously moving slit across the mask and wafer.
Step and repeat aligners, which use projection techniques to expose the wafer a portion at a time. Exposure can be by reduction from the mask to the wafer or 1:1. Enhancements include the use of an excimer laser.
***
(E) PARTS AND ACCESSORIES
Subject to the general provisions regarding the classification of parts (see the General Explanatory Note to Section XVI), the heading includes parts and accessories for the machines and apparatus of this heading. Parts and accessories falling in this heading thus include, inter alia, work or tool holders and other special attachments which are solely or principally used for the machines and apparatus of this heading.
Additionally, Statistical Note 1 to Section XVI states, in pertinent part: “Provisions for semiconductor manufacturing and testing machines and apparatus cover products for…the processing of such materials into semiconductor devices…” It describes “Lithography equipment” as articles “used to transfer the circuit designs to the photoresist coated surface of the semiconductor wafer,” and lists examples of this equipment that are identical to those included in EN 84.86.
The term “part” is not defined in the HTSUS. In the absence of a statutory definition, the courts have fashioned two distinct but reconcilable tests for determining whether a particular item qualifies as a “part” for tariff classification purposes. Bauerhin Techs. Ltd. Pshp. v. United States, 110 F.3d 774, 779 (Fed. Cir. 1997). Under the test initially promulgated in United States v. Willoughby Camera Stores, Inc. (“Willoughby”), 21 C.C.P.A. 322, 324 (1933), an imported item qualifies as a part only if can be described as an “integral, constituent, or component part, without which the article to which it is to be joined, could not function as such article.” Bauerhin, 110 F.3d at 779. Pursuant to the test set forth in United States v. Pompeo, 43 C.C.P.A. 9, 14 (1955), a good is a “part” if it is “dedicated solely for use” with a particular article and, “when applied to that use…meets the Willoughby test.” Bauerhin, 110 F.3d at 779 (citing Pompeo, 43 C.C.P.A. at 14); Ludvig Svensson, Inc. v. United States, 63 F. Supp. 2d 1171, 1178 (Ct. Int'l Trade 1999) (holding that a purported part must satisfy both the Willoughby and Pompeo tests).
Under both of the above-described tests, a part must be “joined” to an article, in some way or another, and “integral” to that article’s continued use. See Rollerblade, Inc. v. United States, 282 F.3d 1349, 1354 (Fed. Cir. 2002) (noting, in concluding that inline skating pads are not parts, that “the roller skates work in the same manner whether the skater wears the protective gear or not”). Thus, the pellicles can only be described as parts of heading 8486, HTSUS, if they attach to, and enable the operation of, machines and apparatus of a kind used solely for the manufacture of electronic integrated circuits. See EN 84.86 (“Parts and accessories falling in this heading thus include, inter alia, work or tool holders and other special attachments.” (emphasis added)). EN 84.86 states that such machines or apparatus include lithography equipment, such as scanners and steppers, used to transfer circuit designs from a photomask to an underlying wafer. However, the EN does not indicate that photomasks or other articles which are incapable of actively performing a particular function, and are instead passively manipulated, can be described as such machines or apparatus. For this reason and several others, we determined in HQ H264336, dated March 15, 2016, that photomasks themselves cannot be described as machines or apparatus of heading 8486. See also HQ H264769, dated June 28, 2016 (affirming and adopting the rationale set forth in HQ H264336 in classifying photomask blanks in heading 3701, HTSUS, rather than heading 8486, HTSUS).
Here, the subject photomask pellicles are not actually “joined” with scanners, steppers, or any other kind of equipment enumerated in EN 84.86. Rather, they are attached to photomasks, which, as we held in HQ H264336, supra, are not machines or apparatus of heading 8486. Moreover, the pellicles certainly are not “integral” to the operation of photolithography equipment, insofar as their removal from this equipment, along with the photomasks to which they are attached, does not inhibit or cease the equipment’s functioning. As we noted in HQ H264336, supra, these machines continue to project light after a given photomask is removed, and replacement of photomasks may in fact constitute a necessary step in the production cycle for a multilayered integrated circuit. As such, the subject photomask pellicles cannot be described as parts of machines and apparatus of a kind used solely for the manufacture of electronic integrated circuits. They consequently fall outside the scope of heading 8486, HTSUS.
In its comment, Intel asserts that the instant photomask pellicles are in fact classifiable in heading 8486 as parts of machines of the heading. For support, Intel cites HQ H267349, dated May 2, 2016, in which CBP classified antenna shields in heading 9017, HTSUS, as parts of geophysical instruments. However, because photomask pellicles are not substantially similar to antenna shields, HQ H267349 is not binding for purposes of the instant decision. Moreover, contrary to Intel’s assertions, the antenna shields at issue in HQ H267349 cannot be analogized to photomask pellicles. Whereas the former are physically integrated into geophysical instruments, and are indispensable to the continual transmission of data among the instruments’ components, the latter are not actually joined to any photolithography equipment. As discussed above, they are instead joined only to photomasks, whose removal from scanners or steppers does not inhibit the capacity of these machines to project light onto other photomasks in the course of a single integrated circuit production cycle.
Intel also contends that CBP, in determining that the photomask pellicles are excluded from heading 8486, HTSUS, has adopted an impermissibly narrow interpretation of the heading. Citing Midwest of Cannon Falls, Inc. v. United States, 122 F.3d 1423 (Fed. Cir. 1997), and Otter Products LLC v. United States, No. 15-1866 (Fed. Cir. August 24, 2016), Intel states that “it is improper to limit the scope of a tariff item to the examples listed in the Explanatory Notes.” However, we do not in fact construe heading 8486 as restricted in scope to the articles identified by name in EN 84.86. It is instead our position, as explained in HQ H267349, supra, that the heading applies not only to the named exemplars, but also to articles which similarly perform active functions in the production of electronic integrated circuits and other materials. This interpretation is supported by the heading’s drafting history, EN 84.86, and Statistical Note 1 to Section XVI, all of which indicate that articles of the heading share the underlying characteristic of active functionality. See id. As the U.S. Court of Appeals for the Federal Circuit (CAFC) has held, the application of ENs in this manner, i.e., to identify requisite characteristics of articles classifiable in a particular heading, is entirely appropriate. See LeMans Corp. v. United States, 660 F.3d 1320-21 (Fed. Cir. 2011). As such, because photomasks lack the active functionality required for classification in heading 8486, HTSUS, the instant pellicles cannot be described as parts of articles classified in the heading.
Intel asserts that even if the photomask pellicles do not constitute a “part” for purposes of heading 8486, HTSUS, they can alternatively be described as an “accessory” classifiable in the heading. However, in Rollerblade, Inc. v. United States, which Intel itself cites for support, the CAFC held that an accessory “must bear a direct relationship to the primary article that it accessorizes,” insofar as the former directly affects the operation of the latter. 282 F.3d at 1352-53; see also HQ H068286, dated November 19, 2010 (“Accessories…must…somehow contribute to the effectiveness of the principal article (e.g., facilitate the use or handling of the principal article, widen the range of its uses, or improve its operation).”). While the instant pellicles ensure the surface integrity of the photomasks to which they are attached, they do not improve the capacity of scanners or steppers to project light onto photomasks. Nor do they enhance or otherwise affect the operation of any other article that qualifies as a machine or apparatus of heading 8486. Accordingly, we remain unconvinced that the instant pellicles are classifiable in heading 8486.
We therefore consider heading 3926, which provides, inter alia, for “other articles of plastic.” The General EN to Chapter 39 states, in pertinent part, as follows:
Plates, sheets, film, foil and strip of heading 39.20 or 39.21
The expression “plates, sheets, film, foil and strip”, used in headings 39.20 and 39.21 is defined in Note 10 to the Chapter.
Such plates, sheets, etc., whether or not surface worked (including squares and other rectangles cut therefrom), with ground edges, drilled, milled, hemmed, twisted, framed or otherwise worked or cut into shapes other than rectangular (including square), are generally classified in headings 39.18, 39.19 or 39.22 to 39.26.
EN 39.26 states, in pertinent part, as follows:
This heading covers articles, not elsewhere specified or included, of plastics (as defined in Note 1 to the Chapter) or of other materials of headings 39.01 to 39.14.
According to the above-cited ENs, plastic articles, including plastic frames and plastic film that has been “worked” by virtue of having been framed, are classified in heading 3926 if not described elsewhere in the HTSUS. Cf. HQ 964780, dated January 31, 2002 (classifying plastic sheets with diagonal cuts in heading 3926); NY N106616, dated June 7, 2010 (classifying protective plastic iPad frame in heading 3926); and NY 802111, dated October 3, 1994 (classifying plastic overhead transparencies with single rounded edges in heading 3926). As stated above, the photomask pellicles at issue consist of thin plastic films mounted to plastic or aluminum frames. The plastic film and plastic frames cannot be classified anywhere but in heading 3926, HTSUS, and are therefore articles of that heading. In effect, the pellicles at issue in HQ H055636, the frames of which are plastic, are articles of plastic that are prima facie classified in heading 3926, HTSUS. However, because the pellicles of HQ H055635, HQ H031396, and NY N121378 contain non-plastic materials, in the form of the aluminum frames, they are described only in part by heading 3926, HTSUS, and are therefore not classifiable there solely by reference to GRI 1.
We accordingly consider heading 7616, HTSUS, which provides for “other articles of aluminum.” EN 76.16 provides, in pertinent part, as follows:
This heading covers all articles of aluminium other than those covered by the preceding headings of this Chapter, or by Note 1 to Section XV, or articles specified or included in Chapter 82 or 83, or more specifically covered elsewhere in the Nomenclature.
Similar to heading 3926, HTSUS, heading 7616 covers aluminum articles, including frames, that do not fall within more specific headings of the HTSUS. See NY N186281, dated October 12, 2011; NY N139353, dated January 13, 2011; and NY N044024, dated November 20, 2008 (all classifying aluminum frames in heading 7616). In HQ H055636, HQ H031396, and NY N121378, the pellicles at issue consist of plastic films mounted to aluminum frames. These frames are not described elsewhere within Chapter 73 or the HTSUS, and are consequently articles of heading 7616, HTSUS. However, because the pellicles in those rulings also contain non-aluminum material, in the form of the plastic films, they are described only in part by heading 7616. They therefore cannot be classified there solely by application of GRI 1.
As such, the pellicles of HQ H055636, HQ H031396, and NY N121378 are classified, pursuant to GRI 3(b), “as if they consisted of the material…which gives them their essential character.” See Home Depot USA, Inc. v. United States, 491 F.3d 1334, 1336 (Fed. Cir. 2007). With respect to “essential character” for purposes of GRI 3(b), EN (VIII) to GRI 3(b) states as follows:
The factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.
While application of the “essential character test” requires a fact-intensive analysis, courts have consistently applied some or all of the factors listed in the above-cited EN in identifying various articles’ essential characters. See Alcan Food Packaging (Shelbyville) v. United States, 771 F.3d 1364, 1367 (Fed. Cir. 2014); Home Depot USA, Inc. v. United States, 491 F.3d 1334, 1337 (Fed. Cir. 2007). More recent court decisions have emphasized the importance of the last of these listed factors, i.e., the role of the constituent materials or components in relation to the use of the goods, in determining essential character. See Structural Industries v. United States, 360 F. Supp. 2d 1330, 1337-1338 (Ct. Int’l Trade 2005); Conair Corp. v. United States, 29 C.I.T. 888 (2005); Home Depot USA, Inc. v. United States, 427 F. Supp. 2d 1278, 1295-1356 (Ct. Int’l Trade 2006), aff'd 491 F.3d 1334 (Fed. Cir. 2007). Consistent with this, CBP has previously ruled, with all other factors being equal, that a composite good’s essential character is imparted by the material that most directly enables the good’s promoted use, rather than any materials that serve structural or support functions. See, e.g., HQ H250830, dated February 22, 2015 (finding that a camping tent’s essential character was imparted by its textile canopy, rather than its steel frame, because only the former could “provide temporary shade and minimal cover for users in fair weather”); and HQ H056243, dated September 2, 2009 (ruling that the steel wire, rather than the plastic frame, of a clothing hanger imparted the article’s essential character because the former “performs the principal function of the device”).
Here, the relative bulks, weights, and values of the plastic films and aluminum frames in HQ H055636, HQ H031396, and NY N121378 are unknown. In the absence of such information, and in view of the courts’ recent treatment of GRI 3(b), the pellicles’ “essential character” is imparted by the material that plays the greatest role in relation to the pellicles’ use. As stated above, the pellicles’ sole use is as protective sealants for photomasks that prevent distortion of the circuitry patterns projected onto the underlying photomasks. The plastic film functions as the actual sealant for this end, repelling dust and other contaminants from the photomask’s surface. In contrast, the aluminum frame secures the plastic film to the photomask but contributes only minimally, if at all, to the protection of the photomask. Therefore, consistent with our analyses in HQ H250830 and HQ H056243, we conclude that the plastic film imparts the essential character of the pellicles. As a result, the pellicles at issue in HQ H055636, HQ H031396, and NY N121378 are classified in heading 3926, HTSUS.
Intel asserts that application of GRI 3(b) is inappropriate in this case because classification of the instant pellicles can be resolved by reference to GRI 3(a), pursuant to which ”[t]he heading which provides the most specific description shall be preferred to headings providing a more general description.” Intel specifically contends that because heading 8486, HTSUS, contains a more specific description than does heading 3926, HTSUS, classification in the former is appropriate. However, the pellicles cannot be classified in heading 8486, as explained above, and are not described in whole by any other heading of the HTSUS. As such, GRI 3(a) does not have application in the instant case, and reliance on GRI 3(b) to determine the pellicles’ classification is both appropriate and necessary.
HOLDING:
By application of GRIs 1 and 3(b), the instant photomask pellicles are classified in heading 3926, HTSUS, specifically in subheading 3926.90.9995, HTSUS (Annotated), which provides for: “Other articles of plastics and articles of other materials of headings 3901 to 3914: Other: Other: Other.” The column one, general rate of duty is 5.3% ad valorem.
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 www.usitc.gov.
EFFECT ON OTHER RULINGS:
HQ H055635, dated November 23, 2009, HQ H055636, dated November 23, 2009, HQ H031396, dated January 5, 2010, and NY N121378, dated September 30, 2010 are hereby REVOKED in accordance with the above analysis.
In accordance with 19 U.S.C. §1625(c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division
CC: Garth Atchley
Senior Manager
Expediters Tradewin LLC
150 Raratin Center Parkway
Edison, NJ 08837
Port Director
Port of Anchorage
U.S. Customs and Border Protection
605 W. Fourth Avenue, Room 203
Anchorage, AK 99501
Cramer Hegeman
KM ACT Corp.
2340 West Braker Lane, Suite A
Austin, TX 78758