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HQ 953912





March 7, 1995

CLA-2 CO:R:C:F 953912 EAB

CATEGORY: CLASSIFICATION

TARIFF NO.: 3823.90.1100

Area Director
U.S. Customs Service
6 World Trade Center
New York, New York 10048

RE: Application for further review of Protest No. 1001-3-100506, dated January 27, 1993; zirconia ingots not 2846.90

Dear Area Director:

This is a decision on a protest filed on January 27, 1993, against your decision in the classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) of merchandise entered on June 5, 1991, liquidated on November 30, 1992, and entered on July 8, 1992, liquidated on December 4, 1992.

FACTS:

The protestant entered the merchandise under subheading 3823.90.1100, HTSUSA, a residual provision for, among other goods, chemical products and preparations of the chemical or allied industries, not elsewhere specified or included, particularly, "Other: Cultured crystals (other than optical elements of chapter 90), weighing not less than 2.5 g each: In the form of ingots." The rate of duty claimed was "Free."

Customs reclassified the goods under subheading 2825.60.0000, HTSUSA, a provision for "Germanium oxides and zirconium dioxide." The rate of duty was advanced to the column one general rate of 3.7 percent ad valorem.

The Protestant seeks reclassification to subheading 3823.90 as aforesaid; otherwise, to subheading 2846.90.2010, HTSUSA, a provision for, among other goods, compounds of rare-earth metals or of yttrium, or compounds of mixtures of rare-earth metals or of yttrium, except cerium compounds. The rate of duty for goods entered under this provision in 1991 and 1992 was "Free."

The protestant informs us that the ingot is formed from a powder of selected oxides of yttrium, zirconium and another rare metal element that were co-precipitated by use of a proprietary method. From the ingot, the application of a ceramic thermal barrier coating on turbine engine parts is achieved through Physical Vapor Deposition which requires a molten and highly stabile phase in a controlled chamber.

Customs Laboratory Report of analysis of a sample indicated an ingot of such dimension to be clearly not less than 2.5 grams in weight. Quantitative analysis established the presence of yttria stabilized zirconia with trace but intentional amounts of another rare-earth metal oxide and binders. It was opined therein that "the complexity of this ingot's composition and end use make it more than a simple zirconium dioxide stabilized."

Yttrium oxide, or "yttria", is recognized to be a stabilizer for zirconia refractories, "zirconia" being a common name for zirconium oxide. The Condensed Chemical Dictionary, Ninth Edition (Van Nostrand Reinhold Company, 1977) at 934 and 944, respectively. The element "yttrium" is not a rare earth, but is found associated with the rare earth elements and is separated only with difficulty. Supra, 744. "Rare metal" is a general term applied to the less common metallic elements, encompassing the alkaline-earth metals, the rare earth elements and, among other metallic elements, zirconium. Ibid.

ISSUE:

Whether yttria stabilized zirconia ingots used in a Physical Vapor Deposition application of a ceramic thermal barrier coating on turbine engine parts are classified under the HTSUSA in chapter 28 or elsewhere.

LAW AND ANALYSIS:

Merchandise imported into the U.S. is classified under the HTSUSA. Tariff classification 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.

The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System represent the official interpretation of the Customs Cooperation Council on the scope of each heading and, 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.

GRI 1 requires that classification be determined first 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.

Except where the context otherwise requires, the headings of chapter 28 apply only to separate chemically defined compounds, whether or not containing impurities. See Legal Note 1(a), Chapter 28, HTSUSA. Stabilizer necessary for their preservation or transport may be added, Legal Note 1(d), Chapter 28, HTSUSA.

Heading 2825, HTSUSA, covers, inter alia, "other metal oxides, hydroxides and peroxides." We find nothing within that context to indicate that the heading covers more than separate chemically defined compounds, and the ingot at hand is certainly more than a separate chemically defined inorganic compound, inasmuch as it is composed of binders and three rare metal, or rare-earth metal, oxides. Furthermore, in view of the required stability of the molten phase in the application process, we agree with Customs Laboratory opinion that the stabilizing presence of the yttria is not for preservation or transport of the ingot; therefore, it is our opinion that Legal Note 1(d) does not save to heading 2825 the classification of the ingot.

The protestant offers an alternative argument, that the composition of the ingot is within the scope of heading 2846, which covers mixtures of rare-earth oxides. We disagree.

By its express terms, heading 2846 admits mixtures of separate chemically defined compounds. EN 28.46 states the following:

This means that the heading will include mixtures of oxides or hydroxides of these elements or mixtures of salts having the same anion (e.g. rare-earth metal chlorides), but not mixtures of salts having different anions, whether or not the cation is the same. The heading will not therefore, for example, cover a mixture of europium and samarium nitrates with the oxalates nor a mixture of cerium chloride and cerium sulfate since these examples are not compounds derived directly from mixtures of elements, but are mixtures of compounds which could be conceived as having been made intentionally for special purposes and which, accordingly, fall in heading 38.23.

The ingot contains a small but intentional amount by weight of binder and as the express terms of the heading do not include mixtures including a binder or binders, we find that the ingot is not a mixture of heading 2846. Without question we conceive the subject ingots as having been made intentionally for special purposes and, accordingly, as falling in heading 3823.

Legal Note 1(a), Chapter 38, HTSUSA, states that the chapter does not cover separate chemically defined elements or compounds, except for certain specified goods not relevant to this decision.

Legal Note 2(a), Chapter 38, HTSUSA, states that heading 3823 "includes the following goods which are not to be classified in any other heading" of the tariff schedule: cultured crystals (other than optical elements) weighing not less than 2.5 g each, of magnesium oxide or of the halides of the alkali or alkaline-earth metals."

The scope of subheading 3823.90, a provision for "residual products of the chemical or allied industries, not elsewhere specified or included" in the tariff schedule, is addressed in part (B) of general Explanatory Note 38.23 as follows:

With only three exceptions (see paragraphs (7), (19) and (31) below), this heading does not apply to separate chemically defined elements or compounds.

. . .

(7) Cultured crystals (other than optical elements) weighing not less than 2.5 g. each, of magnesium oxide or of the halides of the alkali or of the alkaline-earth metals (calcium or lithium fluoride, potassium or sodium chloride, potassium bromide, potassium bromoiodide, etc.). Optical elements of cultured crystals are excluded (heading 90.01).

Cultured crystals (other than optical elements) weighing less than 2.5 g each, are classified in Chapter 28, heading 25.01 (sodium chloride crystals) or heading 31.04 (potassium chloride crystals).
. . .

It has been suggested that the foregoing subparagraph (7) indicates that the scope of subheadings 3823.90.11 and 3823.90.19 is limited to only cultured crystals of magnesium oxide or of the halides of the alkali or alkaline-earth metals weighing not less than 2.5 g each. We disagree.

A statutory provision of law, GRI 1 requires that classification be determined according to the terms of the headings and any relative section or chapter notes. The terms of heading 3823, as well as subheadings 3823.90.11 and 3823.90.19, contain limitations only with respect to weight and form of cultured crystals ("other than optical elements of chapter 90"). These terms are, in our opinion, clear on their face and not subject to being interpreted to limit the scope of the provisions to chemical composition. To the contrary, whereas the headings of chapter 38 generally exclude separate chemically defined elements and compounds (Legal Note 1(a), Chapter 38, supra) subheadings 3823.90.11 and 3823.90.19 describe not only weightier cultured crystals composed of more than one chemical element or compound, but also cultured crystals (other than optical elements) of the separate chemically defined compounds of magnesium oxide or of the halides of the alkali or alkaline-earth metals, weighing not less than 2.5 g each.

HOLDING:

You are instructed to allow the protest.

Yttria stabilized zirconia ingots weighing not less than 2.5 grams each and used in a Physical Vapor Deposition application of a ceramic thermal barrier coating on turbine engine parts are classified under subheading 3823.90.11, HTSUSA, a provision for residual products of the chemical or allied industries, not elsewhere specified or included: other: cultured crystals (other than optical elements of chapter 90), weighing not less than 2.5 g each: in the form of ingots.

Merchandise entered in 1991 and 1992 under the foregoing provision was entitled to be entered free of duty.

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.

In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1992, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with this decision must be accomplished prior to your mailing of this decision to the protestant. Sixty days from the date of this decision, the Office of Regulations and Rulings will take steps to make the decision available to customs personnel via the Customs Ruling Module in ACS and the public via the diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,


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