HQ 0950067 - Bulb flats; Scandinavian angles; angles with unequal flanges; welded sections; Chapter 72, note 1(n); ENs 72.16; H. Conf. Rep. No. 576; Chapter 72, note 1(f); Chapter 72, note 1(k); 19 CFR 152.103 (a)(5); VRAs. - United States International Trade Commision Rulings

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HQ 950067

November 21, 1991

CLA-2 CO:R:C:M 950067 AJS

CATEGORY: CLASSIFICATION

TARIFF NO.: 7216.50.00; 7228.70.30; 7208.42.00; 7211.22.00; 7216.40.00; 7301.20.10.

Mr. K. K. Christensen
President
Oceanic Marine Consultants International, Inc. 3739 Mt. Ariane Drive
San Diego, CA 92111

RE: Bulb flats; Scandinavian angles; angles with unequal flanges; welded sections; Chapter 72, note 1(n); ENs 72.16; H. Conf. Rep. No. 576; Chapter 72, note 1(f); Chapter 72, note 1(k); 19 CFR 152.103 (a)(5); VRAs.

Dear Mr. Christensen:

Your letter of July 31, 1991, regarding the duty rate for certain steel products and related questions has been referred to this office for reply.

FACTS:

The subject products consist of steel bulb flats which are produced by hot-rolling continuous cast blooms. They are made of nonalloy or carbon grade steels with the exception of certain bulb flats which contain 1.65 percent by weight of manganese. The subject bulb flats are used in the shipbuilding industry and range from 6 mm to 17 mm in thickness and from 100 mm to 430 mm in width.

The products at issue also consist of flats and universals, "Scandinavian" angles, angles with unequal flanges and welded sections. These products are made from the same grades of steel used to produce the bulb flats and they are all hot-rolled. The flats and universals range in thickness from 12 mm to 40 mm and in width from 200 mm to 1000 mm. They will be imported in cut lengths. The

"Scandinavian" angles and the angles with unequal flanges measure at least 150 mm in height. The welded sections include butt-fillet welded L-sections, fillet welded T- sections and fillet welded I-sections.

ISSUE:

What is the proper classification of the subject products within Chapters 72 and 73 of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA).

Are duty rates applicable to the price FOB mill or are they applicable to freight costs as well.

Are these products subject to quota limitations.

LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRIs). GRI 1 provides that classification is determined first in accordance with terms of the headings and any relative Section or Chapter notes.

Heading 7216, HTSUSA, provides for angles, shapes and sections of nonalloy steel. These are products having a uniform solid cross section along their whole length which do not conform to any of the definitions of semifinished products, flat-rolled products, bars and rods, or wire in the other lettered items of Chapter 72, note 1. Chapter 72, note 1(n). The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) state that the products of this heading may have edges which are "bulbed" (bulb angles or shipbuilding beams). ENs 72.16, p. 1003 (1991). The subject bulb flats satisfy this description. They are bulbed shipbuilding shapes or sections, and generally made of nonalloy or carbon steel. While the ENs are not dispositive, they provide a commentary on the scope of each heading and offer guidance for interpretation of the HTSUSA. H. Conf. Rep. No. 576, 100th Cong., 2d Sess., p. 549, reprinted in 1988 U.S. CODE CONG. & ADMIN. NEWS p. 1582. Accordingly, we consider the above ENs instructive for determining that the subject bulb flats satisfy the terms of heading 7216, HTSUSA.

Subheading 7216.50.00, HTSUSA, provides for "[o]ther angles, shapes and sections, not further worked than hot- rolled, hot-drawn or extruded." The bulb flats satisfy the terms of this subheading. They are shapes or sections produced by hot-rolling. Accordingly, the subject bulb flats are classifiable within this subheading.

Steel which contains 1.65 percent or more of manganese is an alloy steel for tariff purposes. Chapter 72, note 1(f). The submitted literature indicates that steel grades 275K, 365K, NV2-4, and NV4-4 used to produce the bulb flats contain 1.65 percent of manganese. Consequently, bulb flats produced with these grades cannot be classified within heading 7216, HTSUSA, as products of nonalloy steel. In addition, any of the other products made from these grades are "of alloy steel" for tariff purposes.

Heading 7228, HTSUSA, provides for angles, shapes and sections of other alloy steel. The subject bulbs made of alloy steel satisfy the terms of this heading. Subheading 7228.70.30, HTSUSA, provides for "[a]ngles, shapes, and sections: hot-rolled . . ." The above bulb flats satisfy the terms of this subheading. They are hot-rolled shapes or sections of alloy steel. Accordingly, the subject bulb flats made of alloy steel are properly classifiable within the above subheading.

Heading 7208, HTSUSA, provides for "[f]lat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, hot-rolled . . ."

It was stated that the other products at issue are all made from nonalloy grades of steel, and are also hot-rolled. Flat-rolled products are articles of solid rectangular (other than square) cross section, which are not semifinished products, in the form of straight lengths which if of a thickness of 4.75 mm or more are of a width which exceeds 150 mm and measures at least twice the thickness. Chapter 72, note 1(k). The subject flats and universals satisfy this description. They range in thickness from 12 - 40 mm and in width from 200 - 1000 mm.

The subject flats and universals which are of a width of 600 mm or more satisfy the terms of heading 7208, HTSUSA. Subheading 7208.42.00, HTSUSA, provides for "other" flat- rolled products of a thickness exceeding 10 mm. The subject flats and universals all measure at least 12 mm in thickness. Accordingly, the flats and universals which are of a width of 600 mm or more satisfy the terms of this subheading and are classifiable therein.

Heading 7211, HTSUSA, provides for flat-rolled products of nonalloy steel of a width of less than 600 mm. The subject flats and universals which are of a width of less than 600 mm satisfy the terms of this heading. Subheading 7211.22.00, provides for "other" flat-rolled products of a thickness exceeding 4.75 mm. As stated previously, the subject products all measure at least 12 mm in thickness. Therefore, these products are properly classifiable within the above subheading.

Heading 7216, HTSUSA, provides for sections of nonalloy steel. The subject "Scandinavian" angles and angles with unequal flanges satisfy the terms of this heading. Sub- heading 7216.40.00, HTSUSA, provides for L sections which are not further worked than hot-rolled and of a height of 80 mm or more. The above angles satisfy the terms of this subheading. They are hot-rolled L sections which measure at least 150 mm in height. Accordingly, the subject angles are properly classifiable within the above subheading.

Heading 7301, HTSUSA, provides for welded angles, shapes and sections of steel. The subject welded sections satisfy the terms of this heading. They are welded L, T and I sections of nonalloy steel. More specifically, they are described within subheading 7301.20.10, HTSUSA, which provides for sections of nonalloy steel. Thus, the subject sections satisfy the terms of this subheading and are properly classifiable therein.

With regard to your question on the duty of freight costs, foreign inland freight and other charges for services incident to the international shipment of the merchandise from the country of exportation to the place of importation in the U.S. are nondutiable. 19 CFR 152.103 (a)(5). Any questions regarding this matter should be directed to the Value & Marking Branch of this Office at (202) 566-2938.

Regarding your question about quota limitations, the importation of steel products is controlled by Voluntary Restraint Arrangements (VRAs). We understand that products classifiable under the above subheadings from Norway and Sweden are currently not subject to the VRAs. However, the VRAs are periodically amended so you should check with the Commerce Department's Office of Agreements Compliance at (202) 377-1385 before beginning importation.

HOLDING:

The subject bulb flats of nonalloy steel are classifiable within subheading 7216.50.00, HTSUSA, which provides for "[o]ther angles, shapes and sections, not further worked than hot-rolled . . ."; dutiable at the rate of 0.9 percent ad valorem.

The subject bulb flats of alloy steel are classifiable within subheading 7228.70.30, HTSUSA, which provide for hot- rolled angles, shapes and sections; dutiable at the rate of 2.1 percent ad valorem.

The subject flats and universals are classifiable within either subheadings 7208.42.00 or 7211.22.00, HTSUSA, depending on their respective widths. Products classifiable within these subheading are dutiable at the rate of 6 percent ad valorem.

The subject "Scandinavian" angles and angles with unequal flanges are classifiable within subheading 7216.40.00, HTSUSA, which provides for L sections which are not further worked than hot-rolled and of a height of 80 mm or more; dutiable at the rate of 0.9 percent ad valorem.

The subject welded L, T and I sections are classifiable within subheading 7301.20.10, HTSUSA, which provides for sections of nonalloy steel; dutiable at the rate of 2.8 percent ad valorem.

Sincerely,

John Durant, Director
Commercial Rulings Division

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