HQ 0081795 - Decision on Application For Further Review of Protest No. 1001-7-009254, a petroleum product from Romania - United States International Trade Commision Rulings

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HQ 081795

May 11,1990

CLA-2 CO:R:C:G 081795 JGH

CATEGORY: CLASSIFICATION

TARIFF NO.: 475.25

Area Director of Customs
U.S. Customs Service
New York Seaport
6 World Trade Center
New York, N.Y. 10048

RE: Decision on Application For Further Review of Protest No. 1001-7-009254, a petroleum product from Romania

Dear Sir:

This protest involves the tariff classification of a petroleum product imported to be used as a motor fuel.

FACTS:

This petroleum product was imported in November 1985 and entered by the importer as a benzenoid mixture in item 407.16, TSUS, (a GSP eligible tariff number at a time when Romania enjoyed GSP status). A Customs laboratory report stated that on the basis of the API gravity, distillation range, reid vapor pressure and lead analysis, a sample of the import met the ASTM specifications for unleaded gasoline. The octane rating (R+M/2) was given as 85.6.

ISSUE:

Whether the imported petroleum product is classifiable as motor fuel in item 475.25, TSUS, or a benzenoid mixture in item 407.16, TSUS.

LAW AND ANALYSIS:

It is claimed that the imported petroleum product cannot as classified as motor fuel, as the octane rating is too low. Headnote 2(b), Part 10, Schedule 4, TSUS, defines motor fuel as a petroleum product which is chiefly used as a fuel for internal combustion or other engines. It is asserted that
the data published by the National Institute for Petrolem and Energy Research (NIPER) on motor gasolines for 1985 established that only 2 percent had an octane rating as low or lower than the octane levels shown for the imported product. Thus, it is concluded that the product is not chiefly used as motor fuel in the United States. Customs uses the standards set forth in ASTM D-439 for automotive gasoline as a guideline for determining whether an imported petroleum product meets the headnote definition of motor fuel. ASTM D-439 divides unleaded gasoline in 3 grades based on octane rating: unleaded gasoline with an octane rating greater than 90, unleaded gasoline with an octane rating greater than 87, and octane rating greater than 85. The Niper Report shows that for 1985 there were 213 unleaded gasolines with an antiknock index below 90. Thirty eight of them had an octane range of between 85.0 and 86.9.

This is not an product which was physically incapable of being used as a motor fuel, as mentioned by the court in United States v. Exxon Corp., 66 CCPA 129. Rather, in contrast, this product is clearly within the range of petroleum products being commercially used as motor fuels as imported. Thus, it is of a class or kind chiefly used for motor fuel. Admittedly with the steady improvement in engine performance, octane ratings have increased; however, ASTM standards still reflect, for the period in question, a commercial use within a designated area for an automotive gasoline with an octane rating such as the one in issue.

HOLDING:

You are directed to deny the protest in full.

The protestant should be furnished a copy of this decision with the Form 19 Notice of Action.

Sincerely,

John Durant, Director

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