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HQ 088357


February 11, 1991

CLA-2 CO:R:C:M 088357 JMH

CATEGORY: CLASSIFICATION

TARIFF NO.: 7210.90.60, 7212.50.00

Mr. C.K Murphy
Manager
Export and Import Services
Eveready Battery Company, Inc.
P.O. Box 450777
Westlake, Ohio 44145-2536

RE: Reconsideration of New York Ruling Letter 856239, dated October 5, 1990; lithographed tinplate imported from Japan for use in dry cell batteries; flat-rolled products of iron or nonalloy steel; clad, plated or coated; electrolytically coated or plated with base metal; lithography; prior administrative decisions under TSUS are only instructive; tariff rate increase after conversion from TSUS to HTSUSA

Dear Mr. Murphy:

Your request for the reconsideration of New York Ruling Letter 856239 ("NY 856239") has been forwarded to this office for a reply. NY 856239 concerned the classification of certain lithographed tinplate from Japan.

FACTS:

The article in question is lithographed tinplate imported from Japan. The tinplate is to be used in the manufacture of dry cell batteries. It consists of flat-rolled steel which is cut to shape, coated with tin, and then the lithograph design is painted onto the tin. The design is painted with a substance that will retain ink so that the design may be printed onto paper. The lithographed tinplate will be imported in various widths.

NY 856239 classified the lithographed tinplate in two provisions depending upon the tinplate's width. The first classification is subheading 7210.90.60, Harmonized Tariff Schedule of the United States Annotated ("HTSUSA"), as "Flat- rolled products of iron or nonalloy steel, of a width of 600 mm or more, clad, plated or coated...Other...Other... Electrolytically coated or plated with base metal..." The second
classification is subheading 7212.50.00, HTSUSA, as "Flat- rolled products of iron or nonalloy steel, of a width of less than 600 mm, clad plated or coated...Otherwise plated or coated..."

You believe that the tinplate is properly classified in subheading 7326.90, HTSUSA, as "Other articles of iron or steel..." This classification is premised on the fact that the goods were classified in item 657.25, Tariff Schedules of the United States ("TSUS"), and that the International Trade Commission ("ITC") conversion study stated that subheading 7326.90 HTSUSA, is appropriate for articles that were classified under item 657.25, TSUS. You state that the majority of items that were classified under item 657.25 are now classified under subheading 7326.90. Furthermore, you argue that the change to the HTSUSA was to be "trade neutral" and tariff rate neutral.

ISSUE:

Whether the lithographed tinplate is properly classified in subheadings 7210.90.60 and 7212.50.00 as "Flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, clad, plated or coated...Other...Other...Electrolytically coated or plated with base metal..." and as "Flat-rolled products of iron or nonalloy steel, of a width of less than 600 mm, clad plated or coated...Otherwise plated or coated...", or whether they should be classified in subheading 7326.90 as "Other articles of iron or steel..."

LAW AND ANALYSIS:

You argue that the lithographed tinplates, once classified in TSUS item 657.25, should be classified under what you believe to be the corresponding HTSUSA provision, heading 7326. This is incorrect for several reasons.

First, in the prior tariff, lithographed flat-rolled steel was precluded from classification under the provisions for plates, sheets and strip of steel in Schedule 6, Part 2, Subpart B, TSUS. This exclusion was based on the fact that the operation of lithographing or printing designs on steel went beyond the permissible processing set forth in Schedule 6, Part 2, Headnote 1, TSUS. This classification principle has not been included in the HTSUSA.

Secondly, this office is not bound by the fact that most products formerly classified in item 657.25 may be classified under heading 7326. The HTSUSA created headings which more specifically describe certain goods. However, some goods will exist that are never specifically described by any heading.

Such articles will remain classified in "basket" provisions such as heading 7326. However, this is not the case for the lithographed tinplate under consideration.

Thirdly, you argue that the conversion to the HTSUSA was meant to be "trade neutral" and "rate neutral", and thus the tariff rate change concerning the lithographed tinplate should not have occurred. Trade and rate neutrality was the intention of Congress to the extent that such neutrality was possible. However, some anomalies have occurred since a new tariff which includes new legal guidelines is being implemented. The legislative history of the Omnibus Trade and Competitiveness Act of 1988 states the following:

In light of the significant number and nature of changes in nomenclature from the 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 100-576 to Pub. L. 100-418, p. 1582- 1583.

Prior decisions by the Customs Service and the courts are instructive only when the tariff language remains unchanged and there is no dissimilar interpretation by the text of the HTS.

The prior provision at issue, item 657.25, TSUS, described "Articles of iron or steel, not coated or plated with precious metal...Other articles...Other..." This provision is a change in the tariff language caused by the conversion to the HTSUSA. Since the language is different, this office is not bound by prior administrative decisions.

Finally, the classification principles of merchandise under the HTSUSA as found in the General Rules of Interpretation ("GRIs"), dictate that the lithographed tinplate cannot be classified in heading 7326. GRI 1, HTSUSA, 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 and...according ..to the following provisions." The headings in contention are heading 7210, 7212, and 7326, HTSUSA. These headings describe the following:

7210 Flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, clad, plated or coated...

7212 Flat-rolled products of iron or nonalloy steel, of a width of less than 600 mm, clad plated or coated...

7326 Other articles of iron or steel...

The section and legal notes do not provide any guidance for the coverage of the headings. The tinplate cannot be classified by GRI 1 and the "headings and any relative section or chapter notes.." GRI 3, HTSUSA, one of "the following provisions" must be utilized. When goods are prima facie classifiable under two or more headings GRI 3(a), HTSUSA, requires that the heading which provides the most specific description shall be preferred.

You do not dispute that these products are flat-rolled products which are clad, plated or coated. Although heading 7326 does describe the lithographed tinplate, headings 7210 and 7212 provide a more specific description. Classification in headings 7210 and 7212 is further supported by the Explanatory Notes to the HTSUSA. The Explanatory Notes, although not dispositive, are to be looked to for guidance in the proper interpretation of the HTSUSA. 54 Fed. Reg. 35127, 35128 (August 23, 1989).

Explanatory Note 72.10 states that "clad, plated or coated" as used in heading 7210 applies to products which have been subjected to coating with metal (including electroplating), coating with non-metallic substances (including surface painting) and cladding. Harmonized Commodity Description and Coding System ("HCDCS") Vol. 3, p. 997. These processes are described in Part (C)(2), Items (d)(iv), (d)(v), and (e) of the General Explanatory Note to Chapter 72. HCDCS, Vol. 3, p. 982. The same meaning is given to the terms "clad, plated or coated" of heading 7212. Explanatory Note 72.12, HCDCS, Vol. 3, p. 1000. Thus, is it evident that articles which have been clad, plated or coated are to be included within Chapter 72 if described by a heading. Furthermore, Explanatory Note 73.26 states that articles are to be classified in heading 7326 if they are not "more specifically covered elsewhere in the Nomenclature." HCDCS, Vol. 3, p. 1037. The lithographed tinplate is more specifically described in heading 7210 and 7212.

The lithographed tinplate is a flat-rolled article of steel which is clad, plated or coated. In accordance with GRI 3(a), it is specifically described by headings 7210 and 7212. The proper classification for the lithographed tinplate is in subheading 7210.90.60 or subheading 7212.50.00 as "Flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, clad, plated or coated...Other...Other...Electrolytically coated or plated with base metal..." and as "Flat-rolled products of
iron or nonalloy steel, of a width of less than 600 mm, clad plated or coated...Otherwise plated or coated..." See Headquarters Ruling Letter 084650, dated September 15, 1989.

HOLDING:

The lithographed tinplate are flat-rolled articles of steel which are clad, plated or coated. In accordance with GRI 3(a), it is specifically described by headings 7210 and 7212. The proper classification for the lithographed tinplate is in subheading 7210.90.60 or subheading 7212.50.00 as "Flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, clad, plated or coated...Other...Other...Electrolytically coated or plated with base metal..." and as "Flat-rolled products of iron or nonalloy steel, of a width of less than 600 mm, clad plated or coated...Otherwise plated or coated..." NY 856239 is affirmed.

Sincerely,

John Durant, Director
Commercial Rulings Division

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