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HQ 956210




AUGUST 11, 1994

CLA-2:CO:R:C:M 956210 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 7208.90.00

District Director of Customs
Patrick V. McNamara Bldg.
477 Michigan Ave.
Detroit, MI 48266

RE: PRD 3801-94-100473; Circular Steel Shapes; Steel Circles Cut From Sheet; Flat-Rolled Product, Heading 7208; Automotive Torque Converter (Transmission) Covers, Other Parts of Motor Vehicles, Subheading 8708.99.50; Fabricated Components, Original Motor-Vehicle Equipment, Automotive Products Trade Act (APTA); Blank, GRI 2(a)

Dear Sir:

This is our decision on Protest No. 3801-94-100473, filed on behalf of Kasle Steel of Canada Ltd., against your decision in classifying certain steel circles. The entries were liquidated on October 22 and 29, 1993, and this protest timely filed on January 20, 1994.

FACTS:

The merchandise is steel circles or blanks for the front cover of an automobile torque converter or transmission. The circles, each measuring 14.185 inches plus or minus 0.010 inch, are die cut from 6-gauge hot rolled SAE grade 1015 steel sheet, 0.189-0.20 inch thick. There are four (4) raised square extrusions called oil breakers or oil seal breakers, flaring to a height of 0.02 inch at the outer edge, evenly spaced around the circumference of each circle. After importation, the circles are fed from a conveyor into a machine press which, according to protestant, performs a number of pressing and stamping operations which form the circles into a finished torque converter cover. The post-importation processing is not further described. The oil seal breakers function only to keep the circles from sticking together and insure they are not double-fed into the machine press which would jam the machine. The oil seal breakers have no purpose relative to a finished torque converter cover. - 2 -

Protestant maintains that, as imported, the steel circles or blanks qualify as fabricated components intended for use as original motor-vehicle equipment. As such, they were entered under an appropriate provision for parts and accessories of motor vehicles which would qualify them for free entry under the Automotive Products Trade Act of 1965, as amended (APTA). The claim is that the blanks are physically recognizable as automotive components in an unfinished state because to recut a 14-inch steel circle for any use other than as intended at importation would not be commercially feasible.

It was determined that the blanks are not limited by their shape to a particular use or uses, are not physically recognizable as automotive components, and bear virtually no resemblance to the part they will eventually become. Accordingly, it was determined that, as imported, they qualify as flat-rolled products of heading 7208, Harmonized Tariff Schedule of the United States (HTSUS).

The provisions under consideration are as follows:

7208 Flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, hot- rolled, not clad, plated or coated:

7208.90.00 Other...5 percent

8708 Parts and accessories of the motor vehicles of headings 8701 to 8705:

Other parts and accessories:

8708.99.50 Other...3.1 percent but Free under APTA

ISSUE:

Whether the steel circles, as imported, are blanks under GRI 2(a), HTSUS, and therefore unfinished articles for tariff purposes.

LAW AND ANALYSIS:

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6. GRI 2(a), HTSUS, states in part that any reference in a heading to an - 3 -
article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article.

The Harmonized Commodity Description And Coding System Explanatory Notes (ENs) constitute the Customs Cooperation Council's official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the notes should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

Flat-rolled products of heading 7208 are rolled products of solid rectangular (other than square) cross section, which are not semifinished products for tariff purposes. This heading includes flat-rolled products of a shape other than rectangular or square, of any size, provided they do not assume the character of articles of other headings. Therefore, circular articles are encompassed by heading 7208, if otherwise qualified.

The provisions of Rule 2(a) apply to the imported merchandise if they qualify as blanks. The ENs to GRI 2(a) provide specific guidance on the application of the rule to articles referred to as "blanks." EN (II) to the GRI states on p. 2:

(II) The provisions of this rule also apply to blanks unless these are specified in a particular heading. The term "blank" means an article, not ready for direct use, having the approximate shape or outline of the finished article or part, and which can only be used, other than in exceptional cases, for completion into the finished article or part.

Semi-manufactures not yet having the essential shape of the finished articles
(such as is generally the case with bars, discs, tubes, etc.) are not regarded as
"blanks."

The ENs address two criteria for articles which are "blanks" for GRI 2(a) purposes: approximate shape or outline and sole use for completion into the finished article or part. - 4 -

The protestant contends that the precise external specifications of the wheel blanks is an indication that they will be used principally, if not solely, for completion into automotive torque converter covers. However, as imported, these articles are merely shapes that may be used to make a variety of articles for which SAE grade 1015 steel is suitable. It is only after each steel circle is subjected to a series of post- importation processing operations, which protestant does not describe, that the shape or outline of the finished torque converter cover can be seen.

As imported, therefore, these steel shapes, circles or discs have neither the form nor the shape nor any visually apparent characteristic of the specific part or component they will be when finished. These discs are semi-manufactures the equivalent of bars, discs, tubes, etc., which the ENs indicate are not "blanks" for tariff purposes.

HOLDING:

The circular steel shapes in issue are not blanks for tariff purposes and, therefore, not unfinished articles of heading 8708.

Under the authority of GRI 1, these articles are provided for in heading 7208. They are classifiable in subheading 7208.90.00, HTSUS.

The protest should be DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you should mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel via the Customs Rulings Module in ACS and to the public via the Diskette Subscription Service, the Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director
Commercial Rulings Division


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