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HQ 085912


February 6, 1990

CLA-2 CO:R:C:G 085912 KWM

CATEGORY: CLASSIFICATION

TARIFF NO.: 3920.41.0000

Mr. Sherman Smith
Hudson Valley Tree, Inc.
840 Broadway
Newburgh, NY 12550

RE: Reconsideration of HRL 084775, classification of rigid PVC sheeting

Dear Mr. Smith:

We have received your letter of October 31, 1989, requesting reconsideration of Headquarters Ruling Letter (hereinafter "HRL") 084775, a binding ruling classification of rigid polyvinyl chloride sheeting. After careful review, we have determined that HRL 84775 is correct for the reasons discussed below.

FACTS

In a letter dated May 3, 1989, your company requested a binding classification ruling for polyvinyl chloride (hereinafter "PVC") sheeting. That ruling was issued in New York Ruling Letter (hereinafter "NYRL") 840657, dated May 30, 1989. NYRL 840657 classified the merchandise in question as rigid sheets of PVC under subheading 3920.41.0000, of the Harmonized Tariff Schedule of the United States (hereinafter "HTSUSA"), dutiable at the rate of 5.8 percent ad valorem.

Hudson Valley, in a letter dated June 6, 1989, expressed the opinion that NYRL 840657 was incorrect, and requested of the Commissioner of Customs a reconsideration of the New York Ruling. On October 12, 1989, this office issued HRL 084775, addressing the reconsideration of the PVC sheeting classification. In that ruling, the test for rigid PVC sheeting was established. This office, on the basis of that test, upheld NYRL 840657, and affirmed the classification of the subject "rigid" PVC sheeting under subheading 3920.41.0000, HTSUSA.

In your most recent letter, you have requested that Customs again reconsider our classification of PVC sheeting in NYRL 840657 and HRL 084775.

ISSUE

Is the classification of the PVC sheeting at issue in NYRL 840657 and HRL 084775 correct under the Harmonized Tariff Schedule of the United States?

LAW AND ANALYSIS

The gravamen of your requests for reconsideration is that Customs has failed to properly define and apply the terms "rigid" and "flexible" as they are used in the HTSUSA. That assertion, according to your October 31, 1989 letter, is based principally on the judicial precedent of Sekisui Products, Inc. v. United States, 63 Cust. Ct. 123, C.D. 3885 (1st Div. 1960). It is our opinion, however, that (1) the Sekisui decision is inapplicable to the issue in this case, and (2) assuming arguendo that Sekisui is applicable, Congress intended that the common, commercial or trade meaning be applied to the tariff term "rigid", rather than the dictionary definition.

The Sekisui Products case

We consider the case of Sekisui Products, Inc. v. United States, 63 Cust. Ct. 123, C.D. 3885 (1st Div. 1960) to be inapplicable to the merchandise at issue here. Sekisui and its progeny were decided under the auspices of the Tariff Schedule of the United States (hereinafter "TSUS"), which has since been superseded by the HTSUSA. While we consider case law such as Sekisui to be persuasive, it is not binding on this office. In enacting the HTSUSA, the United States Congress determined, by specific statements of legislative intent, the status of cases such as Sekisui:

In light of the significant number and nature of changes in nomenclature from TSUS to the HTS, decisions by the Customs Service and the courts interpreting nomenclature under the TSUS are not to be deemed dispositive in interpreting the HTS. House Conference Report on Omnibus Trade and Competitiveness Act of 1988, H.R. Rep. No. 100-576, 100th Cong., 2nd Sess., reprinted in 1988 U. S. Code Cong. & Ad. News 1547, 1582.

Indeed, many similar issues are decided in distinctly different ways under the HTSUSA, because the HTSUSA is an international tariff schedule, and its heading and subheading breakouts require different treatment of imported goods than has occurred in the past. For that reason, in those cases (such as this one) where a prior court decision deals with particular terms and goods under the old tariff schedule, we decline an invitation to place significant reliance on that decision.

Congressional Intent

Were we to consider the Sekisui case directly applicable in this instance, despite the fact that it is a TSUS decision, we cannot agree with your contention that the meaning of the term "flexible", and by negative implication the meaning of "rigid", is determined by the dictionary definition. While we agree that Sekisui so holds, we note that the rationale of the court in that case is not applicable in this instance.

As we understand your request, you believe that Congress, in drafting the HTSUSA language, substituted the term "rigid" for the TSUS term "other":

"PVC sheeting is either 'flexible' or 'rigid', there being no differentiation to fall into the category of 'other'." Hudson Valley letter of October 31, 1989, at 1.

Such an interpretation of the HTSUSA results in the simple equation of the terms "other" and "rigid". As our ruling letter of October 12, 1989, points out, we have found no language to indicate that Congress intended this interpretation. Further, Customs is not in a position, and would decline even if we were, to speculate upon any correlation between those terms. To the contrary, we are of the opinion that Congress intentionally used the term "rigid" in the HTSUSA to conform the tariff language to the common, commercial or trade meaning of the tariff terms.

The basis for our determination of the meaning of the tariff terms in subheadings 3920.41 and 3920.42, HTSUSA, is set forth in HRL 084775, and will not be repeated here in detail. Briefly, we do not find, in this instance, any of the judicially determined prerequisites for adopting the dictionary definition of a tariff term. Rather, it is our opinion that Congress clearly intended to define the scope of the goods included in 3920.41.000, HTSUSA, by definite, uniform and commercial standards. That intent is manifested in the adoption of "rigid" as a tariff term. The ASTM standards, set out in ASTM Designation D883-83a, for classifying goods based on their modulus of elasticity, provide a commercial designation commonly accepted in commerce and trade for "rigid" PVC sheeting. We are of the opinion that use of the ASTM standards will properly fulfill Congressional intent. The ASTM standards, therefore, take precedence over the Sekisui dictionary definition. In addition, we are of the opinion that the use of these standards provides clearly defined guidelines for determining whether PVC sheeting is "flexible" or "rigid", thereby preventing uncertainty among importers as to the proper HTSUSA classification. It also provides a readily available means by which items may be tested.

In summary, we are of the opinion that the Sekisui decision relied on by you in your October 31, 1989, correspondence is inapplicable to the present case. In addition, even if we were to accept that precedent as applicable, its rationale is distinguishable in light of the legislative intent regarding the meaning of the tariff terms in question. That intent, we believe, is manifest in the adoption of specific tariff terms and the implied refusal of Congress to legislatively ratify the Sekisui decision.

HOLDING

After considering your request for reconsideration of HRL 084775, we decline to modify or revoke our classification of PVC sheeting having a modulus of elasticity greater than 100,000 psi as other sheets of plastic, noncellular and not reinforced, of polymers of vinyl chloride, rigid, under subheading 3920.41.0000, HTSUSA.

Sincerely,

Harvey B. Fox
Director, Office of
Regulations and Rulings

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