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HQ 085422


October 23, 1989

CLA-2 CO:R:C:G 085422 JMH

CATEGORY: CLASSIFICATION

TARIFF NO.: 8404.20.00

Mr. Joseph Mendelson
Project Manager
GEA Power Cooling Systems, Inc.
10240 Sorrento Valley Road
San Diego, California 92121

RE: Steam Condensers from South Africa

Dear Mr. Mendelson:

Your letter of August 29, 1989, requesting a classification and importation ruling under the Harmonized Tariff Schedule of the United States (HTSUSA) for the steam condensers manufactured by your GEA facility in South Africa has been referred to this office for a reply.

FACTS:

The merchandise in question are steam condensers to be imported from the Union of South Africa. The steam condensers are to be used with large steam boilers which are employed by large electric utilities in power generation. Arrays of these condensers condense steam for reuse within the boilers.

The steam condensers are made from standard steel tubes, ASTM ST-214 alloy, purchased locally in South Africa. The steel is reworked into a proprietary elliptical shape by a GEA plant within South Africa. Steel fins, made by GEA in South Africa or imported from West Germany, are attached to the elliptical shape. The finned elliptical tubes are then galvanized, formed, trimmed and inserted into a steel frame section which incorporates header nozzles and sidewalls. The steel frame sections are later assembled into the array format.

ISSUES:

Under which heading of the Harmonized Tariff Schedule of the United States (HTSUSA) should the steam condensers be classified and whether U.S. sanctions against the Union of South Africa apply to these goods.

LAW AND ANALYSIS:

The classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's). GRI 1 states in part that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes..." The relevant heading in this case is 8404, HTSUSA. This heading describes:

8404 Auxiliary plant for use with boilers of heading 8402 or 8403...condensers for steam or other vapor power units; parts thereof...

8404.20.00 Condensers for steam or other vapor power units...

Since the goods are imported from South Africa, the question arises whether the goods are excluded from entry into the United States pursuant to the Comprehensive Anti-Apartheid Act of October 2, 1986 (Pub. L. 99-440). "No article which is grown, produced, manufactured, marketed, or otherwise exported by a parastatal organization of South Africa may be imported into the United States.." South African Transactions Regulations, 31 CFR 545.208(a) (1988). According to the latest State Department listing, GEA Power Cooling Systems, Inc. is not a parastatal organization. Therefore, the condensers are not excluded by these regulations.

Importation of certain steel and iron products from South Africa is prohibited, regardless of the producer. 31 CFR 545.206 (1988). The U.S. Customs Headquarters Unclassified Telex 00438 of January 12, 1989, lists all affected HTSUSA headings. Heading 8404, HTSUSA, is not included on the list. Thus, the assembled steam condensers are not prohibited from entry into the U.S.

HOLDING:

The steam condensers imported from South Africa are not prohibited from importation into the United States pursuant to the Comprehensive Anti-Apartheid Act of 1986. The steam
condensers are classifiable within subheading 8404.20.00, HTSUSA. The rate of duty is 7 percent ad valorem.

Sincerely,

John Durant, Director
Commercial Rulings Division

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