HQ H286670
July 23. 2019
CLA-2 OT:RR:CTF:TCM H286670 CkG
TARIFF NO: 7326.90.86
Center Director
Base Metals CEE
U.S. Customs and Border Protection
610 South Canal Street
Chicago, IL 60607
ATTN: Ilse Rousseau, Import Specialist
Re: Request for Internal Advice; classification of iron grates
Dear Center Director,
This is in response to a request by the Center of Excellence and Expertise for Base Metals, dated May 18, 2017, on the classification of cast ductile iron grates. The Base Metals CEE submitted its request following receipt of a January 13, 2017 request by D&S Castings, Inc., that the CEE seek internal advice from our office pursuant to 19 C.F.R. §177.11(a) (“internal advice request”). Our determination as to the classification of the subject merchandise is set forth below.
FACTS:
The ductile cast iron grates at issue are manufactured at a foundry through a casting process whereby liquid iron is poured into a mold where it solidifies. The mold itself is lined with a fine layer of sand before the molten iron is poured into the mold. The grate is removed from the mold after the molten iron has solidified. The solidified ductile cast iron is grinded and shot-blasted to remove any sand from the mold. The grate is then sprayed with a thin layer of paint for cosmetic purposes.
The grates are used in the United States as covers to various outdoor drains at locations such as golf courses, athletic complexes and turf fields. The grates are also used to cover drains in various industrial and commercial buildings. The applied paint wears off shortly after the grate is installed.
ISSUE:
Whether the iron grates at issue are classified in heading 7325, HTSUS, as other cast articles of iron or steel, or in heading 7326, HTSUS, as other articles of iron or steel.
LAW AND ANALYSIS:
Classification of goods under the HTSUS is governed by the General Rules of
Interpretation (GRI). GRI 1 provides that classification 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 HTSUS provisions under consideration are as follows:
7325: Other cast articles of iron or steel:
7325.99: Other: 7325.99.10: Of cast iron… 7326: Other articles of iron or steel: 7326.90: Other:
Other:
Other:
7326.90.86: Other…
* * * *
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 follow, 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 Explanatory Note to heading 7325 provides as follows:
This heading covers all cast articles of iron or steel, not elsewhere specified or included.
The heading includes, inspection traps, gratings, drain covers and similar castings for sewage, water, etc. systems; hydrant pillars and covers; drinking fountains; pillar boxes, fire alarm pillars, bollards, etc.; gutters and gutter spouts; mine tubbing; balls for use in grinding and crushing mills; metallurgical pots and crucibles not fitted with mechanical or thermal equipment; counterweights; imitation flowers, foliage, etc. (except articles of heading 83.06); mercury bottles.
This heading does not cover castings which are products falling in other headings of the Nomenclature (e.g., recognisable parts of machinery or mechanical appliances) or unfinished castings which require further working but have the essential character of such finished products.
The heading also excludes :
(a) Articles of a kind described above obtained by processes other than casting (e.g., sintering) (heading 73.26).
(b) Statues, vases, urns and crosses of the type used for decoration (heading 83.06).
* * * *
The applicable legal notes and section notes do not provide a definition for “cast articles”. Heading 7325, HTSUS, covers all cast articles not elsewhere specified or included in the Nomenclature. Generally, casting is characterized by molten blast furnace iron being bottom poured into a mold. After sufficient time for solidification and cooling, the castings are removed from the mold by a shakeout machine. The casting process is considered complete when surface imperfections are removed by blast cleaning, chipping, burning or combinations of these processes. See Headquarters Letter Ruling (HQ) 960783, dated May 13, 1998 (citing HQ 959315, dated October 1, 1996).
“Drain covers and similar castings for sewage, water, etc. systems” are included in EN 73.25 as examples of iron or steel cast articles of heading 7325, HTSUS. However, articles subjected to processes in addition to “casting” are beyond the scope of heading 7325, HTSUS. See e.g., HQ W968382, dated July 21, 2008 (“processes in addition to ‘casting’ will serve to advance cast articles of 7325, HTSUS, to the point where they are no longer covered by that heading”). Certain independent processes not merely incidental to the general foundry work are considered to advance an article beyond casting. See also HQ 963283 (May 11, 2000), which stated as follows: “Customs longstanding position on the issue of advancements in castings is that the casting process is considered complete when, after the casting solidifies and cools, surface imperfections are removed by ballast cleaning, chipping, burning or combination of these processes.”
CBP has consistently held that coating, laquering and painting are processes not incidental to general foundry work and which advance cast products beyond the scope of heading 7325. See e.g., Treasury Decision (T.D.) 32506, 22 Treas. Dec. 806, decided May 9, 1912, finding that cast-iron nails galvanized in zinc are no longer dutiable as “castings” because the process of galvanization advanced the cast-iron nails to the point where they were considered “manufactures of metal not specially provided for.” See also HQ 959315, dated October 1, 1996, in which CBP held that that zinc-coated castings used as socket caps were not classifiable in heading 7325, HTSUS. Likewise, in HQ 963283, dated May 11, 2000, we held that coating cast-iron platens with lacquer advanced the platens to the extent that they were no longer classifiable as cast articles of heading 7325, HTSUS. In HQ W968382, CBP directly addressed the question of whether painting is, like coating or laquering, a process which precludes classification in heading 7325, finding that “Painting, like coating with lacquer or zinc, accomplishes the purpose of inhibiting rust from developing on the subject cast-iron products. Also like zinc or lacquer coating, painting is a process entirely independent from casting. As such, even if the subject merchandise is painted as opposed to coated with lacquer, it has still been advanced beyond the condition allowed for classification in heading 7325, HTSUS.”
Whether the paint is applied for decorative purposes or to inhibit rust, painting, like coating or laquering, it accomplishes a specific purpose unrelated to the casting itself. Coating, painting, and laquering are thus all processes which are entirely independent from casting, and which have been deemed by CBP to advance a product beyond the scope of heading 7325. The subject merchandise, in its condition as imported, is classifiable as “[o]ther articles of iron or steel” in heading 7326, HTSUS.
In its internal advice request, D&S Castings cites to Ross Machine & Mill Supply, Inc. et al. v. United States, (“Ross Machine”) 69 Cust. Ct. 160 (Cust. Ct. 1972), in which the court held that “painting” cast-iron rollers for machines to protect them against oxidation did not advance them beyond being cleaned.
At issue in Ross Machine was whether painted iron castings were classified in the TSUS provision 680.60, which provided for “Cast-iron (except malleable cast-iron) rollers for machines, not alloyed and not advanced beyond cleaning, and machined only for the removal of fins, gates, sprues, and risers or to permit location in finishing machinery.”
Decisions by the Customs Service and the courts interpreting nomenclature under the TSUS are not deemed dispositive in interpreting the HTSUS. Nevertheless, on a case-by-case basis prior decisions should be considered instructive in interpreting the HTSUS, particularly where the nomenclature previously interpreted in those decisions remains unchanged and no dissimilar interpretation is required by the text of the HTSUS. Omnibus Trade and Competitiveness Act of 1988, Enacted H.R. 4848, 102 Stat. 1107, P.L. 100-418. See also, Hewlett-Packard Co. v. United States, 189 F. 3d. 1346; 22 Ct. Int’l. Trade 514 (CIT 1999).
In the instant case, we note that not only is the language used in TSUS provision 680.60 not substantially identical to HTSUS heading 7325, but also that heading 7325 is not the successor to 680.60; under the TSUS, cast articles not elsewhere provided for were classified in various subheadings under Part 3, Subpart G of the TSUS, which provided simply for “articles of metal which are not more specifically provided for elsewhere in the tariff schedules.” Under the HTSUS, “other” cast iron or steel articles are grouped together under heading 7325. The structure and language of the HTSUS with regards to cast iron or steel articles therefore differs significantly from that of the TSUS; prior interpretations of TSUS provisions involving cast iron articles are therefore not dispositive or especially instructive in determining the current classification under heading 7325 of such articles. See also Irwin Indus. Tool Co. v. United States, 920 F.3d 1356, (Fed. Cir. 2018) (Court not bound by prior interpretation of TSUS provision not identical to the HTSUS provision at issue therein).
Similarly, D&S cites to HQ H015186, dated October 17, 2008, in which CBP determined that painted cast iron machine parts were classified in subheading 8466.93.15, HTSUS, which is identical to the TSUS subheading at issue in Ross Machine. As HQ H015186 did not involve the classification of any article under heading 7325 or an interpretation of the specific language at issue in the Explanatory Notes to heading 7325, it is neither dispositive nor especially relevant in determining the scope of heading 7325.
D&S further cites to HQ 959521, issued to DMD Importers, Inc. on December 3, 1996, in which CBP classified cast iron grates in heading 7325. However, there is no indication in either HQ 959521 or the ruling it revoked, NY A84658, dated June 10, 1996, that these cast iron grates were coated or painted in any way. The grates are described in HQ 959521 as “cast articles of alloyed ductile iron…designed to fit over a PVC body in a drainage system of the type used on golf courses, in athletic complexes, industrial and commercial buildings, and for turf maintenance” and the issue under consideration was whether castings of ductile iron were considered nonmalleable for tariff purposes. Whether the products at issue were subject to any additional processes that could have advanced them beyond the scope of heading 7325 was not addressed in either ruling. HQ 959521 is thus inapplicable to the current matter.
Finally, D&S puts forth a claim of prior treatment under 19 U.S.C. §
1625(c), which provides, in pertinent part, as follows:
(c) Modification and revocation. A proposed interpretive ruling or decision which would –
(1) modify (other than to correct a clerical error) or revoke a prior
interpretative ruling or decision which has been in effect for at least 60 days; or
(2) have the effect of modifying the treatment previously accorded by the
Customs Service to substantially identical transactions;
shall be published in the Customs Bulletin. The Secretary shall give interested parties an opportunity to submit, during not less than the 30-day period after the date of such publication, comments on the correctness of the proposed ruling or decision. After consideration of any comments received, the Secretary shall publish a final ruling or decision in the Customs Bulletin within 30 days after the closing of the comment period. The final ruling or decision shall become effective 60 days after the date of its publication.
* * * *
The modification or revocation of interpretive rulings, protest review decisions,
and previous treatment of substantially identical transactions is discussed at 19 C.F.R. § 177.12(c), which provides, in pertinent part, as follows:
(c) Treatment previously accorded to substantially identical transactions – (1) General.
The issuance of an interpretive ruling that has the effect of modifying or revoking the treatment previously accorded by Customs to substantially identical transactions must be in accordance with the procedures set forth in paragraph (c)(2) of this section. The following rules will apply for purposes of determining under this section whether a treatment was previously accorded by Customs to substantially identical transactions of a person:
There must be evidence to establish that: …
There was an actual determination by a Customs officer regarding the facts and issues involved in the claimed treatment;
The Customs officer making the actual determination was responsible for the
subject matter on which the determination was made; and
Over a 2-year period immediately preceding the claim of treatment, Customs
consistently applied that determination on a national basis as reflected in liquidations of entries or reconciliations or other Customs actions with respect to all or substantially all of that person's Customs transactions involving materially identical facts and issues;
The determination of whether the requisite treatment occurred will be made by Customs on a case-by-case basis and will involve an assessment of all relevant factors. In particular, Customs will focus on the past transactions to determine whether there was an examination of the merchandise (where applicable) by Customs or the extent to which those transactions were otherwise reviewed by Customs to determine the proper application of the Customs laws and regulations. For purposes of establishing whether the requisite treatment occurred, Customs will give diminished weight to transactions involving small quantities or values, and Customs will give no weight whatsoever to informal entries and to other entries or transactions which Customs, in the interest of commercial facilitation and accommodation, processes expeditiously and without examination or Customs officer review;
…
The evidentiary burden as regards the existence of the previous treatment is on the person claiming that treatment. The evidence of previous treatment by Customs must include a list of all materially identical transactions by entry number (or other Customs assigned number), the quantity and value of merchandise covered by each transaction (where applicable), the ports of entry, the dates of final action by Customs, and, if known, the name and location of the Customs officer who made the determination on which the claimed treatment is based. In addition, in cases in which an entry is liquidated without any Customs review (for example, the entry is liquidated automatically as entered), the person claiming a previous treatment must be prepared to submit to Customs written or other appropriate evidence of the earlier actual determination of a Customs officer that the person relied on in preparing the entry and that is consistent with the liquidation of the entry.
* * * *
D&S Castings has provided CBP with documentation regarding only one entry of cast iron grates, which were liquidated in heading 7325 after D&S responded to a CF 28 Notice issued by CBP. Treatment of one entry is insufficient to meet a claim of prior treatment under §1625 and §177.12(c). Furthermore, there is no evidence that the cast iron grates at issue in the indicated entry were identical to the ones at issue herein, or otherwise painted, coated or processed in a similar manner. Nor has the protestant submitted any evidence that CBP has ever considered whether painting advances a product beyond the coverage of heading 7325 in connection with any entry by D&S Castings. As such, we find that the requestor has failed to meet its evidentiary burden to establish a claim of treatment under 19 U.S.C. §1625 or 19 C.F.R. § 177.12.
HOLDING:
The ductile cast iron grates at issue are classified in heading 7326, HTSUS, specifically subheading 7326.90.86, HTSUS, which provides for “Other articles of iron or steel: Other: Other: Other: Other.” The 2018 column one, general rate of duty is 2.9% ad valorem.
You are directed to mail this decision to the internal advice applicant, no later
than 60 days from the date of this letter. On that date the Office of Regulations and Rulings will make the public version of the decision available to CBP personnel, and to the public on the CBP Home Page online at www.cbp.gov, by means of the Freedom of Information Act, and other public methods of distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division