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HQ 955965




July 11, 1995

CLA-2 R:C:F 955965 ALS

CATEGORY: CLASSIFICATION

TARIFF NO.: 3204.17.9085

Area Director of Customs
JFK Area
JFK Airport
Building 77, Room 228
Jamaica, New York 11430

RE: Application for Further Review of Protest 1001-93-106067, Dated September 1, 1993, Regarding the Classification of Microlith Yellow 2R-A

Dear Mr. Mattina:

This ruling is on a protest that was filed against your decision of July 23, 1993, regarding an entry for the above noted product.

FACTS:

The product under consideration, Microlith Yellow 2R-A, is imported in bulk powdered form. It has been surface treated to maintain the fine, micro-particle size necessary for use in making the final product. The imported product is stated to consist of colorants and binders or dispersants. It is soluble in alcohol. The product was entered and liquidated in subheading 3204.17.5090 (now 3204.17.9085) Harmonized Tariff Schedule of the United States Annotated (HTSUSA), a provision for synthetic organic coloring matter and preparations based thereon as specified in legal note 3 to Chapter 32.

The protestant, stating that the product is a concentrated stain in powder form, seeks reclassification of the product in subheading 3210.00.0000, HTSUSA, the provision for other paints and varnishes (including enamels, lacquers and distempers). The - 2 -
protestant notes that the product is a specially prepared pigment predispersed in resin and developed for printing. The protestant's publication "Pigments, Pigment Preparations and Special Dyes (1992)", notes that Microlith-A products are pigments preparations which consist of specially prepared forms of high grade organic, classical organic and inorganic pigments predispersed in an ethyl cellulose carrier resin. It further notes that they have been developed for the gravure and flexographic printing inks used in the packaging sector. The major uses of the product is stated to be woods stains and liquid inks for packaging. The protestant states that its principal use in the United States is as stains and that it is made ready for staining wood by "simply stirring the concentrate into a solvent or solvents." The importer notes that the imported product is mixed with 4 different solvents in a varying ratio in a "simple stirring process" to make the finished product.

ISSUE:

Is the product under consideration a stain for tariff purposes?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is governed by the General rules of Interpretation (GRI's) taken in order. GRI 1 provides that the classification is determined first in accordance with the terms of the headings and any relative section and chapter notes. If GRI 1 fails to classify the goods and if the headings and legal notes do not otherwise require, the remaining GRI's are applied, taken in order.

Subheading 3204.17.5090 (now 3204.17.9085), HTSUSA, under which the product was liquidated, covers in pertinent part synthetic organic coloring matter and preparations based thereon, particularly synthetic organic coloring matter and preparations based thereon as specified in legal Note 3 to chapter 32, HTSUSA. Subheading 3210.00.0000, HTSUSA, as suggested by the protestant, provides for other paints and varnishes (including enamels and lacquers and distempters).

The referenced legal note provides, inter alia, as follows:

Headings 3203, 3204, 3205 and 3206 apply also to preparations based on coloring matters...of a kind used for coloring any material or used as ingredients in the
manufacture of coloring preparations. The headings do not apply, however, to pigments dispersed in nonaqueous media, in liquid or paste form, of a kind used in the manufacture of paints, including enamels (heading 3212), or to other preparations of heading...3210.

Counsel argues that since the principal use of the preparation in the United States is as a stain it should be so classified. Noting that the importer's own sales literature indicates that the product may normally be used for multiple purposes, a stain and a liquid ink, we disagree with the proposed conclusion.

Since we find that the product is not described by the terms of heading 3210, we are of the further opinion that classification of this product is not controlled by that part of legal note 3 to chapter 32, which provides that goods of heading 3210 are excluded from classification under heading 3204.

The protestant has suggested that the product is an unfinished or incomplete wood stain pursuant to GRI 2(a). It states that the goods formulated therefrom, upon simple dilution, are principally used as wood stains. We do not agree therewith. In this regard we note that the Explanatory Note to Rule 2(a) advises that the rule does not normally apply to Section VI goods in view of the scope of the headings of that section. Heading 3204 covers, among other article, "other preparations based on synthetic organic colouring matter of a kind used for colouring any material or used as ingredients in the manufacture of colouring preparation." EN 32.04(I)(E). Furthermore, "Synthetic organic colouring matter may be soluble or insoluble in water. It has almost completely replaced natural organic colouring, particularly for dyeing...paper or wood. It is also used to prepare...colours of headings 32.08 to 32.10..and for colouring plastics, rubber, waxes, oils, photographic emulsions, etc." EN 32.04(I) at page 455. We are of the opinion that the broad scope of heading 3204 is the type of circumstance in which GRI 2(a) does not normally apply.

We are of the opinion that Microlith A pigment preparations are classifiable under the provision for synthetic organic coloring matter and preparations based thereon as specified in legal note 3 to chapter 32, HTSUSA, which provides in part that heading 3204 applies to preparations based in coloring matter of a kind used for coloring any material.

We have concluded that Microlith yellow 2R-A, the subject of the immediate protest, is a concentrated pigment or a color which may be dispersed in a variety of vehicles. The vehicles are formulated, according to the importers brochures and technical information so that they may be adaptable to a variety of uses in products such as varnishes, stains, inks, fibers and plastics. These substrates are, after importation, usually further modified by the addition of additives, and reformulated to their customers specifications.

HOLDING:

Microlith A is a coloring preparation classified under subheading 3204.17.9085, HTSUSA, a provision for synthetic organic coloring matter, whether or not chemically defined; preparations as specified in legal note 3 to chapter 32, pigments and preparations based thereon, other, other, other. Products so classified are subject to a general rate of duty of 18.6 percent ad valorem.

Since the classification indicated above is the same as the classification under which the entry was liquidated, you are instructed to deny 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.

In accordance with Section 3A(11)(b) of Customs Directive 099 3553-065, dated August 4, 1993, Subject, Revised Protest Directive, this decision should be provided by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entries in accordance with this decision must be accomplished prior to the mailing of 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 the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director
Commercial Rulings Division

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