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HQ 089006


May 12, 1993

CLA-2 CO:R:C:M 089006 NLP

CATEGORY: CLASSIFICATION

TARIFF NO.: 6804.22.40; 6804.22.60

District Director
U.S. Customs Service
Main and Stebbins Sts, PO Building
P.O. Box 1490
St. Albans, Vermont 05478

RE: Protest and Request For Further Review No. 0201-90-000383; Grindstones of natural stone; grindstones of agglomerated abrasives; subheadings 6804.22.10 and 6804.23.00; explanatory notes to heading 6804; resins; synthetic binders; U.S.-Canada Free Trade Agreement; General Note

Dear Sir:

This is in response to your Protest and Request for Further Review No. 0201-90-000383. At issue is the classification of grindstones under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The articles subject to protest consist of various abrasive wheels, bricks and segments. The abrasives in question are used to grind and polish granite, marble and other stones. The products are generally composed of the following materials:

1) xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

2) Inert fillers-xxxxxxxxxxxxxxxxxxxxxxxxxxxx

3) Emery or silicon carbide

4) Phenolic resin

All of the above products are sourced in either the United States or Canada, with the exception of the xxxxxxxxx, which is manufactured in various countries in Europe. In Canada, the abrasive, fillers and binder are combined together to form the grindstones and they are then imported into the United States.

Upon importation, Customs classified some of the entries under subheading 6804.22.40, HTSUS, which provides for "[m]illstones, grindstones, grinding wheels and the like, without frameworks, for grinding, sharpening, polishing, trueing or cutting, hand sharpening or polishing stones, and parts thereof, of natural stone, of agglomerated natural or artificial abrasives, or of ceramics, with or without parts of other materials: [o]ther millstones, grindstones, grinding wheels and the like: [o]f other agglomerated abrasives or of ceramics: [o]ther: [a]brasive wheels." The bricks and segments were classified in subheading 6804.22.60, HTSUS. However, after discussions with the National Import Specialist Customs determined that the grindstones are classifiable in subheading 6804.22.10, HTSUS, which provides for "[m]illstones, grindstones, grinding wheels and the like...: [o]ther millstones, grindstones, grinding wheels and the like: [o]f other agglomerated abrasives or of ceramics: [b]onded with synthetic resins."

Counsel for the protestant contends that the grindstones are bonded together with xxxxxxxxx and the majority of the balance of the product is abrasive. Therefore, the grindstones are classifiable in subheading 6804.23.00, HTSUS, which provides for "[m]illstones, grindstones, grinding wheels and the like...: [o]ther millstones, grindstones, grinding wheels and the like, of natural stone." In the alternative, counsel contends that the grindstones are classifiable in either subheadings 6804.22.40, HTSUS, or 6804.22.60, HTSUS, as the amount of synthetic resin used in the grindstones is minor xxxxxx.

The initial entries were liquidated on September 7, 1990, and the protest timely filed on November 20, 1990.

ISSUE:

Are the grindstones comprised of xxxxxxx?

If the grindstones are comprised of xxxx, are they classifiable in subheading 6804.22.10, HTSUS, or in subheading 6804.22.40/60, HTSUS?

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI's) set forth the manner in which merchandise is to be classified under the HTSUS. GRI 1 requires that classification be determined first according to the terms if the headings of the tariff and any relative section or chapter notes and, unless otherwise required, according to the remaining GRI's.

Heading 6804 provides for "[m]illstones, grindstones, grinding wheels and the like, without frameworks, for grinding, sharpening, polishing, trueing or cutting, hand sharpening or polishing stones, and parts thereof, of natural stone, of agglomerated natural or artificial abrasives, or of ceramics, with or without parts of other materials." The Harmonized Commodity Description and Coding System Explanatory Notes to heading 6804 state, on page 900, the following:

Grinding stones, grinding wheels, etc., must be made essentially of natural stone, agglomerated or not, (e.g., sandstone, granite, lava, flint, molasse, dolomite, quartz, trachyte), of agglomerated natural or artificial abrasives (e.g., emery, pumice, tripoli...silicon carbide....) or of ceramics....

Agglomerated grinding wheels, etc., are made by mixing ground abrasive or stone with binders such as...cement (especially magnesian cement) or less rigid cementing materials (such as rubber, shellac or plastics)....

The subject grindstones are made by mixing an abrasive material, either emery or silicon carbide xxxxx. Therefore, the grindstones are considered agglomerated abrasives and as such, are classified in subheading 6804.22, HTSUS.

The next issue to be resolved concerns the applicable eight digit subheading. The possible eight digit subheadings for this merchandise are the following:

6804.22.10 other millstones, grindstones, grinding wheels and the like: of other agglomerated abrasives or of ceramics: bonded with synthetic resin

6804.22.40 other millstones, grindstones, grinding wheels and the like: of other agglomerated abrasives or of ceramics: other: abrasive wheels

6804.22.60 other millstones, grindstones, grinding wheels and the like: of other agglomerated abrasives or of ceramics: other: other

The protestant has submitted a technical report on the issue of whether the xxxxx present in the grindstones is used as a xxxx, as earlier Customs laboratory reports have suggested. See, Laboratory Report No, 2-90-22831-002. The supplemental information provides detailed explanations and scientific references to support the position that the xxxx contained in the grindstones is not xxxx. We forwarded this technical report to the Customs laboratory in New York for their analysis.

To support their position, the protestant included in the report a discussion on xxxx for a grinding wheel with a similar composition to the subject grindstones. The grinding wheel subject xxxx was composed of silicon carbide xxxx. The amount of xxxx present was xxxx. The second of the two patents describes the subject of the patent as follows:

Abrasive for hard stones [granite, marble, etc.]

The compn. is the same as in the main specification but is further improved by choosing xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

The submission also demonstrated that the amount of xxxx needed to serve as xxxx in grinding wheels is usually xxxx. This figure is significantly higher than the amount of resin present in the subject grindstones.

It is our conclusion that the additional information in its totality is persuasive of the fact that, given the composition of the subject grindstones, the xxxx grindstones and it does not act xxxx. xxxx the grindstones. Therefore, the abrasive wheels are classified in subheading 6804.22.40, HTSUS, and the other grindstones are classified in subheading 6804.22.60, HTSUS.

United States-Canada Free Trade Agreement

Articles which are imported from Canada may be entitled to certain tariff preferences under the United States-Canada Free Trade Agreement ("CFTA") if the articles are "originating goods" as defined by General Note 3(c)(vii)(B), HTSUS, which explains how articles imported into the United States may be "goods originating in the territory of Canada." The first method is if goods are "wholly obtained or produced in the territory of Canada and/or the United States." General Note 3(c)(vii)(B)(1), HTSUS. The second method is if the goods are "transformed in the territory of Canada and/or the United States." General Note

A product which is "wholly obtained or produced in the territory of Canada and/or United States" is one which is grown, mined, harvested, born and raised in Canada and/or the United States, or otherwise intimately connected to the two countries and their land, air and sea territories as defined in General Note 3(c)(vii)(L), HTSUS. Since the grindstones are manufactured in part from xxxx manufactured in European countries, the grindstone is not "wholly obtained or produced in the territory of Canada and/or United States."

The second method through which an article can become an originating good for CFTA purposes is for an article made of foreign materials to be transformed in Canada and/or the United States in accordance with General Note 3(c)(vii)(B)(2), HTSUS. A transformation is evident when a change in tariff classification occurs that is authorized by General Note 3(c)(vii)(R), HTSUS.

In this instance, all of the grindstones' components are either wholly obtained or produced in Canada or the U.S., with the exception of the xxxx, which is manufactured in Europe. Therefore, for the grindstones to be considered originating goods for CFTA purposes, they must be transformed in accordance with General Note 3(c)(vii(B)(2), HTSUS. Specifically, the relevant provision in General Note 3(c)(vii)(R), HTSUS, reads:

Change in Tariff Classification Rules
(13) Section XIII: Chapters 68 through 70.

(aa) A change from one chapter to another.

On importation into Canada, the xxxx is classified in subheading xxxx, HTSUS, which provides for xxxx. The xxxx is classified in subheading xxxx, which provides xxxx. The xxxx is classified in subheading xxxx, HTSUS, and the xxxx is classified in subheading xxxx, HTSUS. The emery is classified in subheading 2513.21.00, HTSUS, and the xxxx is classified in subheading xxxx, HTSUS. These materials are combined to form a grindstone which is classifiable in heading 6804, HTSUS. This is a change in classification which results in a recognized transformation under the CFTA. Therefore, the grindstone would be considered of Canadian origin for purposes of the CFTA and would be entitled to preferential treatment under the CFTA.

HOLDING:

The grindstones are classified in subheading 6804.22.40, HTSUS, if they are in the shape of wheels. If the grindstones are in the shape of bricks, they are classified in subheading 6802.22.60, HTSUS. The grindstones are considered originating goods for CFTA purposes in accordance with General Note 3(c)(vii)(b)(2) and General Note 3(c)(vii)(R). They are entitled to the CFTA tariff preferences for goods classified in the above subheadings, upon compliance with all applicable regulations.

The protest should be granted in full. A copy of this decision should be attached to the Customs Form 19 and mailed to the protestant as part of the notice of action on the protest.

Sincerely,

John Durant, Director
Commercial Rulings Division

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