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HQ 960745




OCTOBER 30, 1997

CLA-2 RR:CR:GC 960745 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8102.91.10

Mr. Alvin Silvey
A. Burghart Shipping Co., Inc.
One Cross Island Plaza, Suite 113
Rosedale, NY 11422

RE: NY B83934 Affirmed; Molybdenum Scrap Bars; Broken Molybdenum Bar s; Molybdenum Metal Powder Sintered into Bars, Broken Bars; By-Product of Production of Molybdenum Bars; Bars Suitable for Production of Molybdenum Wire; Unwrought Molybdenum; Waste and Scrap, Subheading 8102.91.50, Section XV, Note 8(a), Additional U.S. Note 1; Heading 81.02 Explanatory Notes; Anval Nyby Powder AB v. United States; HQ 951568, HQ 960894

Dear Mr. Silvey:

In a letter, dated July 10, 1997, you request reconsideration of a ruling issued to you on the classification under the Harmonized Tariff Schedule of the United States (HTSUS), of broken molybdenum bars, products of Germany.

FACTS:

In NY B83934, issued to the A. Burghart Shipping Co., Inc. on April 8, 1997, by the Chief, National Commodity Specialist Division, certain sintered molybdenum bars that were unsuitable for the production of molybdenum wire, were held to be classifiable as unwrought molybdenum, in subheading 8102.91.10, HTSUS.

The process first involves the production of molybdenum metal powder from molybdenum hydroxide in special reduction furnaces. The powder is then placed in molds and pressurized, after which it is agglomerated into bars by sintering. Some bars break during the sintering process. Incomplete burning in the sintering furnaces may result in some bars with specifications - 2 -
that make them unsuitable for further production into molybdenum wire. These bars are broken up and resemble the bars that break during processing. Both types of bars are the subject of this inquiry.

You state that both types of broken bars will be sold in the United States at the weights and prices consistent with those of remelt scrap. You also note that both types are by-products of the production of molybdenum bars suitable for processing into molybdenum wire. For these reasons you conclude that subheading 8102.91.50, HTSUS, a provision for molybdenum waste and scrap, is the correct classification.

The provisions under consideration are as follows:

8102 Molybdenum and articles thereof, including waste and scrap:

Other:

8102.91 Unwrought molybdenum, including bars and rods obtained simply by sintering; waste and scrap:

8102.91.10 Unwrought

8102.91.50 Waste and scrap

ISSUE:

Whether sintered, broken up molybdenum bars are similar manufactured primary forms under Section XV, Additional U.S. Note 1, HTSUS.

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. - 3 -

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding, 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 ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

Section XV, Note 8(a), HTSUS, defines Waste and scrap as "Metal waste and scrap from the manufacture or mechanical working or metals, and metal goods definitely not usable as such because of breakage, cutting-up, wear or other reasons." Section XV, Additional U.S. Note 1, HTSUS, states, in relevant part, that for the purposes of Section XV the term "unwrought" refers to metal, whether or not refined, in the form of ingots, blocks, lumps, billets, cakes, slabs, pigs, cathodes, anodes, briquettes, cubes, sticks, grains, sponge, pellets, flattened pellets, rounds, rondelles, shot and similar manufactured primary forms, but does not cover sintered forms which have been processed otherwise than by simple trimming, scalping or descaling.

Heading 8102 provides for molybdenum and articles thereof, including waste and scrap. At the 8102.91 subheading level, unwrought molybdenum and molybdenum waste and scrap are separated by a semicolon. This is an indication that they are intended for tariff purposes to be separate, distinct classes of merchandise. Thus, if the broken sintered molybdenum bars under consideration are unwrought forms of molybdenum under subheading 8102.91.10, they cannot be considered waste and scrap under subheading 8102.91.50.

Bars are not among the exemplars listed in Section XV, Additional U.S. Note 1, HTSUS. However, the molybdenum bars are to be regarded as unwrought forms of molybdenum if they are manufactured primary forms similar to the exemplars listed in Section XV, Additional U.S. Note 1. This issue was addressed in Anval Nyby Powder AB v. United States, Slip Op. 96-80 (Ct. Int'l Trade, decided May 21, 1996). In the context of cobalt alloy powders used in plasma arc welding and thermal spraying or coating applications, the Court concluded that the phrase "manufactured primary forms" in Additional U.S. Note 1 refers to forms that "have undergone some processing but must undergo further processing before they appear in an eventual final product. This definition provides a unifying characteristic for the otherwise disparate enumerated forms." In concluding that the cobalt alloy powders were manufactured primary forms similar - 4 -
to the ones enumerated in the cited legal note, the Court noted that the cobalt powder used in both applications must first be melted to form a solid mass, either in the shape of the weld (in a plasma arc welding application) or the shape of a valve or other article to be coated (in a thermal spraying application). In neither case was the powder itself a final good. It was later processed so as to become a part of or subsumed into a finished good, and that apart from that finished good, the powder had no apparent utility.

Like tungsten and vanadium, molybdenum is a necessary alloying element used in tool steels, superalloys, and refractory alloys. As such, the molybdenum bars must undergo further processing which changes their form or shape before they become part of a finished good. For example, molybdenum is a common alloying element used to make intermediate alloy steel for cutting tools in which extreme wear resistance and the ability to retain a smooth cutting edge on light cuts is required. In this application the molybdenum bars must necessarily change from a solid to an intermediate molten state which does not possess the dimensional features of bars. Anval Nyby, at p. 46. The broken sintered molybdenum bars are not themselves a final product. Ultimately, they become a part of or are subsumed into a finished good, i.e., a high speed cutting tool. Apart from the finished good they have no apparent utility.

This conclusion is supported by heading 8102 ENs which state in part, at p. 1185, that since the metallurgy of molybdenum resembles that of tungsten, the second part of the EN to 81.01 applies to heading 8102 by appropriate substitution of terms. The 81.01 EN states, at p. 1184, that tungsten of heading 8101 may be in the form of unwrought metal, e.g., in blocks, ingots, sintered bars and rods, or as waste and scrap (for the latter, see the EN to heading 72.04). The referenced EN states that heading 72.04 excludes waste and scrap which can be adapted for other uses or refashioned into other goods without first being recovered as metal. Thus, sintered molybdenum bars unsuitable for use in making molybdenum wire, but used as an alloying element in steel for high speed cutting tools, is not waste and scrap for tariff purposes.

For these reasons, we remain of the opinion that the broken sintered molybdenum bars are manufactured primary forms similar to the exemplars listed in Section XV, Additional U.S. Note 1, HTSUS. The bars constitute unwrought molybdenum for tariff - 5 -
purposes. Substantially similar issues were considered in HQ 951568, dated July 27, 1992, and in HQ 960894, dated October 8, 1997, in which molybdenum bar ends were held to be unwrought molybdenum for tariff purposes.

HOLDING:

Under the authority of GRI 1, broken sintered molybdenum bars are provided for as unwrought molybdenum, in heading 8102. They are classifiable in subheading 8102.91.10, HTSUS. NY B83934, dated April 8, 1997, is affirmed.

Sincerely,

John Durant, Director
Commercial Rulings Division

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