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HQ 950490


March 20, 1992

CLA-2 CO:R:C:F 950490 EAB

CATEGORY: CLASSIFICATION

TARIFF NO.: 3915.90

District Director
U.S. Customs Service
111 West Huron Street
Buffalo, New York 14202

RE: Application for Further Review of Protest No. 0901-91- 1-00211, dated June 24, 1991, concerning waste of plastics; waste; scrap; primary form

Dear Sir:

This is a decision on a protest filed June 24, 1991, against your decision in the classification of merchandise liquidated June 7, 1991 and June 21, 1991.

FACTS:

The protestant entered all goods in subheading 3915.90.0000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), a provision for waste and scrap of plastics, other [not polymers of ethylene, styrene or vinyl chloride], free of duty. Customs reclassified all goods under subheading 3902.10, HTSUSA, as a polymer of polypropylene in primary form. The goods qualified for special duty treatment under the U.S.-Canada Free Trade Agreement and were liquidated at the rate of duty of 5 percent ad valorem.

A sample of the merchandise has been provided to this office for purposes of visual examination. It consists of desired polypropylene chips of differing colors (red, blue, black, green and white) obtained by crushing or chopping up discarded battery cases, mixed with impurities identified as wood chips, floor sweepings, phenolic battery cell separators and other foreign matter, all collected by the protestant for its purposes, in this case, as a seller of recyclable plastics.

Independent technical analysis submitted to this office by and on behalf of the protestant finds that the impurities must be removed by further processing before the product can be considered usable in recycling applications. Such further processing would include washing, chopping and crushing, second washing and degreasing, thermomelting and compounding, coloring and chemical stabilization with extenders and anti-oxidants, extruding, cutting and, sizing and drying.

A second independent technical analysis submitted to this office by and on behalf of the protestant concludes that the subject merchandise is not "virgin material," as that phrase is defined in Society of the Plastics Industry, Plastics Engineering Handbook of the Society of the Plastics Industry, Inc., 5th Edition, to wit: "Plastic resin or compound that has not been processed except to prepare it for its intended use."

Finally, Customs has liquidated similar merchandise for the protestant under the Tariff Schedules of the United States as plastic waste and scrap n.s.p.f. and, more recently, under the claimed subheading at this port.

ISSUE:

What is the proper classification under the HTSUSA of a dry mixture of polypropylene chips of differing colors (red, blue, black, green and white) obtained by crushing or chopping up discarded battery cases, wood chips, floor sweepings, phenolic battery cell separators and other foreign matter, to be subjected to further remanufacturing processes to make it usable as an article of plastic to be recycled?

LAW AND ANALYSIS:

The tariff classification of merchandise under the HTSUSA is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUSA and are to be considered statutory provisions of law for all purposes. GRI 1 requires that classification be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in order.

The Explanatory Notes to the Harmonized Commodity Description and Coding System represent the official interpretation of the Customs Cooperation Council on the scope of each heading; although neither binding upon the contracting parties to the Harmonized System Convention nor considered to be dispositive interpretations, they should be consulted on the proper scope of the System.

Note 6, chapter 39, for purposes of headings 3901-3914, lists "primary forms" as liquids and pastes, including dispersions, blocks of irregular shape, lumps, powders, granules, flakes and similar bulk forms. Note 7 to the chapter emphasizes that heading 3915 does not apply to waste, parings and scrap of a single thermoplastic, transformed into primary forms, and directs one to headings 3901-3914.

Heading 3915, HTSUSA, describes waste, parings and scrap of plastics.

Explanatory Note 39.15 states that the products of heading 3915 may consist of broken or worn articles of plastics, clearly not usable for their original purposes.

We find that the subject merchandise is not composed of a single thermoplastic material that has been "transformed into" a primary form. Dismissing the actual collection and packaging of the subject goods as irrelevant, the only meaningful labor expended upon the plastic substance in the dry mixture has been the breaking of plastic battery cases into small pieces. We are of the opinion that the plastic in the mixture has not been transformed into primary form and will not be until it is subjected to further processing that would include washing; chopping and crushing; second washing and degreasing; thermomelting and compounding; coloring and chemical stabilization with extenders and anti-oxidants; extruding; cutting; and, sizing and drying. We find, therefore, that Note 7, Chapter 39, HTSUSA, does not operate to require that the subject merchandise fall to be classified under heading 3902.

Based upon our visual examination of the material submitted, we conclude that the subject goods consist of a mixture of broken articles of plastics (battery cases) clearly not usable for their original purposes. See Explanatory Note 39.15, HTSUSA. Pursuant to GRI 1, we are of the opinion that the subject goods are specifically described by heading 3915 as waste of plastics. Since the plastic in the waste is a polymer of polypropylene, we find that the subject goods are classifiable under subheading 3915.90, HTSUSA.

HOLDING:

Polypropylene chips of differing colors (red, blue, black, green and white) obtained by crushing or chopping up discarded battery cases mixed with wood chips, floor sweepings, phenolic battery cell separators and other foreign matter that must be removed by further extensive processing in order to make an article of plastic suitable for recycling is properly classifiable under subheading 3915.90, HTSUSA, a provision for waste of plastics, other. Articles classified under this subheading in 1991 were to have been entered free of duty.

Since reclassification of the merchandise as indicated above will result in a lower rate of duty than as liquidated, you are instructed to allow the protest in full.

A copy of this decision should be attached to the Customs Form 19 and provided to the protestant as part of the notice of action on the protest.

Sincerely,

John Durant, Director
Commercial Rulings Division

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