United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 1992 HQ Rulings > HQ 0000112 - HQ 0088511 > HQ 0088342

Previous Ruling Next Ruling


HQ 088342


December 23, 1991

CLA-2 CO:R:C:F 088342

CATEGORY: CLASSIFICATION

TARIFF NO.: 2710.0015

Steven H. Becker, Esq.
Coudert Brothers
200 Park Ave
New York, N.Y. 10166

RE: Classification of High Aromatic Content Motor Fuel

Dear Mr. Becker:

Your letter of November 19, 1990, concerns the classification under the Harmonized Tariff Schedules of the United States (HTSUS) of a motor fuel in which the weight of the aromatic constituents exceeds that of the nonaromatic.

FACTS:

You state that Vitol S.A., Inc., intends to import motor fuel having aromatic constituent content which exceeds the weight of the nonaromatic. Some shipments, it is stated, will contain predominantly aromatic constituents obtained solely as a result of the production at the refinery of a predominantly aromatic gasoline. Other shipments will be of a gasoline which have aromatic constituents added in the blending operation.

ISSUE:

Classification of a motor fuel which has a high aromatic content, in the light of Note 2, Chapter 27, HTSUS.

LAW AND ANALYSIS:

It is acknowledged that the products meet the commercial definition for motor fuel. However, it is contended that since Note 2, Chapter 27, HTSUS, limits the aromatic content petroleum oils may contain, this type of gasoline is not classifiable as a motor fuel because of its high aromatic content, but rather as an aromatic mixture in heading 2707, HTSUS. It is further contended that this view is supported by the Explanatory Notes for heading 2710, where it states that petroleum oils consist predominantly of non-aromatic hydrocarbons.

Furthermore, this view is supported, it is claimed, by two New York rulings--NYL 829932 (May 20, 1988) and NYL 831879 (October 11, 1988). In the former, it was concluded that the weight of the aromatics in the platformate and the heavy aromatic constituents exceeds the weight of the nonaromatic constituents. Classification was stated to be in heading 2707.50.000, HTSUS, or 2707.99.5000, HTSUS, depending percentage of distillation. In the second case, which dealt with the classification of a C-9 resin oil feed stock in view of the weight of the aromatic constituents, the product was said to be classifiable in 2707.50.000, HTSUS. Both of these decisions, of course, were issued before the HTSUS went into effect and reflect Customs opinion at the time. Shortly after the HTSUS became law, Customs had the opportunity to examine this issue, and, as a result, set forth in Internal Advice 49/90 its present position on the classification of motor fuel and motor fuel blendstock; this decision had the effect of reversing NYL 829932. Since it was not clear that the other ruling involved a blendstock, its status would not necessarily be changed.

As you note, note 2, Chapter 27, HTSUS, states that "petroleum oils and oils obtained from bituminous minerals" include not only petroleum oils and oils obtained from bituminous minerals, but also similar oils, as well as those consisting mainly of mixed unsaturated hydrocarbons, obtained by any process, provided that the weight of the nonaromatic constituents exceeds that of the aromatic constituents."

It is your opinion that the language of this note, along with the interpretive views expressed in the Explanatory Notes to Chapter 27, mandates that a petroeum product containing a predominance of aromatic constituents must be classified in heading 2707.

We disagree. The Explanatory Notes divide heading 2710 into three sections: (A) which includes not only crudes but also the distilled products such as petroleum spirits, kerosene, gas oils, lubricating oils, etc.; (B) Similar Oils, examples of which are given as mixed alkylbenzenes (mixtures of unsaturated hydrocarbons and saturated acyclic hydrocarbons); and (C) the oils described in (A) and (B) to which various substances have been added to render them suitable for for particular uses, provided that the products contain 70% or more of petroleum oils as a basis.

Gasoline is a petroleum preparation described in (C), containing by weight more than 70% or more of "petroleum oils" (the basic constituents of the preparation); it is a preparation to which a mixed blend of aromatics have been added, regardless of amount, (as well as other additives) to make the finished gasoline. Furthermore, it cannot be ignored that regardless of what might have been the drafters' intention in the chapter note, the language fails as a matter of grammatical construction to establish that the limitation does, in fact, apply to petroleum oils; rather it is concluded that the limitation modifies only the nearest antecedent: "similar oils". Where the arrangement and punctuation of a paragraph give rise to conflicting constructions, one of which leads to an absurdity, the other will be adopted. International Forwarding Co. v. United States, 12 Cust. Ct. Appls. 539, T.D. 43264 (1929). We are of the opinion that Congress had no intention of making what is becoming the bulk of the motor fuel imports duty free, and to so conclude, we feel, would be an absurd result.

HOLDING:

Gasoline which meets the requisite specifications for motor fuel, following U.S. Note 3, Chapter 27, HTSUS, is classifiable in Subheading 2710.00.15, HTSUS, regardless of aromatic content.

Sincerely,

John Durant, Director

Previous Ruling Next Ruling

See also: