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HQ 965083




June 22, 2001

CLA-2 RR:CR:TE 965083 jsj

CATEGORY: CLASSIFICATION

TARIFF NO.: 4418.90.4090

Port Director
U.S. Customs Service
2nd & Chestnut Street
Room 102
Philadelphia, Pennsylvania 19106

Attn.: Team 171

RE: Application for Further Review of Protest No.: 1101-00-100164.

Wood flooring; Wood products worked or shaped on edges, faces and ends; Application of amendments to Explanatory Notes; Headings 4409 and 4418, HTSUSA.

Dear Port Director:

The purpose of this correspondence is to address the Application for Further Review of Protest Number: 1101-00-100164, dated August 4, 2000. The Importer of Record and Protesting Party is Lake Forest Product, Inc.

The Customs Service issued a Notice of Action (Customs Forms 29) to Lake Forest Product, Inc. (Lake Forest). The Notice of Action is dated April 12, 2000. It indicated that a rate advance was proposed based on the conclusion of the Customs Service Import Specialist that the Importer had not properly classified wood flooring from Burma.

The Importer, subsequent to receipt of the Notice of Action, filed a Protest challenging Customs classification. Lake Forest’s Protest accompanied an Application for Further Review that was approved.

A review of the Protest (Customs Form 19) and the Customs Protest and Summons Information Report (Customs Form 6445) indicates that the protest was timely filed pursuant to 19 U.S.C. 1514 (c) (3) (West 1999) and 19 C.F.R. 174.12 (e) (2).

This Protest decision is being issued subsequent to a review of the Protest filed on behalf of Lake Forest and the memorandum and accompanying documents that were made a part of the Protest.

FACTS

The articles in issue are teak flooring from Burma. The flooring measures either: (1) Three-fourths (¾) of an inch by three-fourths (¾) of an inch square and either one (1) to four (4) inches in length or six (6) inches in length; or (2) Three-fourths (¾) of an inch by five and five-eighths (5 5/8) inches and six to nine feet in length. The flooring is tongued and grooved on its edges as well as its ends.

ISSUE

Did Customs properly issue the Notice of Action proposing to take a rate advance based on the Customs Service Import Specialist’s conclusion that the Importer of Record had incorrectly classified the above-described wood flooring products pursuant to the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) because the merchandise of the subject entry was tongued and grooved along the edges as well as the ends ?

LAW AND ANALYSIS

The responsibility for interpreting and applying the HTSUSA rests with the U.S. Customs Service.

See Joint Explanatory Statement of the Committee of Conference, H.R. Conf. Rep. No. 100-576, at 549 (1988) reprinted in 1988 U.S. Code Cong. and Adm. News 1547, 1582 [hereinafter Joint Explanatory Statement]. The Customs Service, in accordance with its legislative mandate, classifies imported merchandise pursuant to the General Rules of Interpretation (GRI) and the Additional U.S. Rules of Interpretation. See 19 U.S. C. 1202 (West 1999). GRI 1 provides that classification decisions are to be “determined according to the terms of the headings and any relative section or chapter notes.” GRI 1 further provides that merchandise which can not be classified in accordance with the dictates of GRI 1 should be classified pursuant to the other General Rules of Interpretation in their sequential order.

Heading 4418, HTSUSA, provides for “Builders’ joinery and carpentry of wood, including cellular wood panels and assembled parquet panels; shingles and shakes.” Heading 4418, HTSUSA. Customs has previously concluded that this heading, more accurately than any other heading, describes wood products that are tongued along one edge and end, and grooved along the other edge and end (ie. worked on both the edges or faces and the ends). See HQ 964825 (June 11, 2001), HQ 956363 (Sept. 2, 1994), HQ 955712 (April 20, 1994), HQ 952940 (Mar. 24, 1993) and NY 806603 (Feb. 24, 1995).

Customs based its prior rulings and will base this Protest decision, in accordance with General Rule of Interpretation 1, on the wording or nomenclature of heading 4418, HTSUSA. The headings and subheadings, as well as the General Rules of Interpretation and the Additional U.S. Rules of Interpretation being congressionally enacted U.S. statutory law. See Section 1202 supra Note 2.

Customs, in addition to reviewing heading 4418, HTSUSA, also examined heading 4409, HTSUSA. Customs undertook this review because of the Importer’s suggestion that the merchandise is properly classified in heading 4409, HTSUSA. Heading 4409, HTSUSA, provides for “Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, molded, rounded or the like) along any of its edges or faces, whether or not planed, sanded or finger-jointed.” (Emphasis added) Heading 4409, HTSUSA. Heading 4409, HTSUSA, specifically provides for wood that is continuously worked or shaped along any of its edges or faces, but the heading is noticeably silent with regards to wood that is shaped on its ends. The fact that heading 4409, HTSUSA, does not address wood products that are worked on the ends is significant to Customs decision in this matter.

Customs, as secondary, non-binding authority, relied on the interpretation of the HTSUSA headings provided by the Explanatory Notes (EN) to the Harmonized System (HS). The Harmonized System is the internationally agreed upon nomenclature or language which establishes a degree of uniformity or harmonization between the tariff schedules of all Contracting Parties to Convention on the Harmonized Commodity Description and Coding System. The United States is a Contracting Party or signatory to the Convention.

The Explanatory Notes constitute the official interpretation of the Harmonized System. The Explanatory Notes, although neither legally binding nor dispositive of classification issues, provide commentary on the scope of each heading of the HS and are consulted for guidance by the Customs Service. The EN’s are generally, but not always, indicative of the proper interpretation of the Harmonized System. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989). See generally What Every Member of the Trade Community Should Know About: Tariff Classification, U.S. Customs Service, A Basic Level Informed Compliance Publication (2001) available at the World Wide Web site of the U.S. Customs Service at www.customs.gov, click “Importing & Exporting,” then search Informed Compliance. See also Mita Copystar Am. v. United States 21 F. 3d 1079, 1082 (Fed. Cir. 1994) citing Lynteq, Inc. v. United States 976 F. 2d 693, 699 (Fed. Cir. 1992); Jewelpak Corp. v. United States, 97 F. Supp. 2d 1192 (CIT 2000).

Congress, when it was anticipated that the Tariff Schedule of the United States (TSUS) would be replaced with the Harmonized Tariff Schedule of the United States, addressed the status of the Explanatory Notes in a Joint Committee Report See Joint Explanatory Statement supra Note 1.. Congress stated in the Committee Report:

The Explanatory Notes constitute the Customs Cooperation Council’s official interpretation of the Harmonized System. They 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.

Id.; The Customs Cooperation Council is now generally know as the World Customs Organization.

The Committee Report further advised, however, that the EN’s were not binding on the Contracting Parties to the Convention and as such should be consulted for guidance, but not “treated as dispositive.” Id.

The Explanatory Notes utilized for guidance purposes by the Customs Service in previously classifying similar merchandise were EN 44.09 and EN 44.09 exclusion (b). Explanatory Note 44.09, at the time it was referenced for guidance, provided:

This heading covers timber, particularly in the form of boards, planks, ect., which after sawing or squaring, has been continuously shaped along any of its edges or faces either to facilitate subsequent assembly or to obtain the moldings or beadings described in Item (4) below, whether or not planed, sanded or end-jointed, e.g. finger-jointed (see the General Explanatory Note to this Chapter). Continuously shaped wood covers both products with a uniform cross-section throughout the length and products having a repetitive design in relief. Explanatory Note 44.09.

Exclusionary paragraph (b) to EN 44.09 provided:

The heading also excludes:(b) Wood which has been mortised or tenoned, dovetailed or similarly worked at the ends and wood assembled into panels being builders’ carpentry or joinery (e.g. parquet flooring panels made up from parquet flooring blocks, strips, ect., whether or not on a support of one or more layers of wood)(heading 44.18). Explanatory Note 44.09 (b).

The Customs Service in prior ruling letters classified merchandise similar to that of Lake Forest in heading 4418, HTSUSA, noting that neither heading 4409, HTSUSA, nor the EN’s to heading 4409, HTSUSA, addressed wood products that were tongued and grooved along the edges and ends. See HQ 956363, HQ 955712, HQ 952940 and NY 806603 supra. Customs additionally took note of exclusionary paragraph (b) of EN 44.09 which suggested that wood “worked at the ends” was builder’s joinery and carpentry and, therefore, properly classified in heading 4418, HTSUSA.

The situation confronted in the instant protest is that the Harmonized System Committee of the World Customs Organization (WCO) has subsequently amended the Explanatory Notes. The Harmonized System Committee of the WCO amended, in particular, Explanatory Note 44.09. See Amendments to the Nomenclature and to the Explanatory Notes to Clarify the Scope of heading 44.09, Annex M/7 to Doc. NC0090B1 (HSC/23/May 99). Explanatory Note 44.09 now reads:

This heading covers timber, particularly in the form of boards, planks, ect., which after sawing or squaring, has been continuously shaped along any of its edges or faces either to facilitate subsequent assembly or to obtain the moldings or beadings described in Item (4) below, whether or not planed, sanded or end-jointed, e.g. finger-jointed (see the General Explanatory Note to this Chapter). For the purposes of this heading the term “edges” includes ends. Continuously shaped wood covers both products with a uniform cross-section throughout the length and products having a repetitive design in relief. (Emphasis added).

Lake Forest, the Importer and Protestant, relying on the amended Explanatory Notes which now defines the term “edges” to include “ends,” understandably asserts that its product, which is tongued along one edge and end, and grooved along the other edge and end, should be classified in heading 4409, HTSUSA. Lake Forest entered the merchandise in subheading 4409.20.2560, HTSUSA, which provides for:

Wood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, molded, rounded or the like) along any of its edges or faces, whether or not planed, sanded or finger-jointed:

4409.20 Nonconiferious:

Wood flooring

4409.20.2560 Other.

Although Lake Forest’s position is reasonable on first reading, its weakness is two-fold. Initially, heading 4418, HTSUSA, specifically provides for the merchandise in issue. “Builders’ joinery and carpentry of wood” of heading 4418, HTSUSA, describes wood products that are continuously worked on the edges, ends and faces. Heading 4418, HTSUSA. Heading 4409, HTSUSA, only describes “[w]oodcontinuously shapedalong any of its edges or faces.” Heading 4409, HTSUSA. Secondly, the Explanatory Notes are not law in the United States and neither the courts nor the Customs Service are bound to follow them if they are not consistent with the HTSUSA which is, as previously stated, U.S. statutory law. The EN’s, as previously established, only offer guidance and are not dispositive. The Customs Service is, therefore, basing is decision on the language of heading 4418, HTSUSA. This office is not relying on EN 44.09, as amended, to clarify heading 4409 of the Harmonized Tariff Schedule of the United States.

The Customs Service concludes that the merchandise imported by Lake Forest is properly classified, pursuant to GRI 1, in heading 4418, HTSUSA. The correct subheading, pursuant to GRI 6, is subheading 4418.90.4090, HTSUSA. Subheading 4418.90.4090, HTSUSA, provides for:

Builders’ joinery and carpentry of wood, including cellular wood panels and assembled parquet panels; shingles and shakes:

Other:

Other

4418.90.4090 Other.

Although the reasoning underlying this decision may be inconsistent with the Harmonized System Committee’s amended Explanatory Notes relating to heading 44.09 of the HS, it is consistent with the Congressionally intended implementation of heading 4409 and heading 4418 of the Harmonized Tariff Schedule of the United States Annotated.

It is the decision of Customs, as previously stated, that heading 4418, HTSUSA, specifically provides for the classification of the merchandise in issue. Since heading 4418, HTSUSA, specifically provides for the Burma teak wood flooring, tongued and grooved on the edges and ends, the Customs Service need not consult the Explanatory Notes to heading 44.09 of the HS for guidance.

The Importer and Protestant specifically notes that the merchandise in issue is not mortised, tenoned or similarly worked. The Protestant suggests that since the merchandise is not mortised, tenoned or similarly worked, that is since the flooring does not have a mortise, a rectangular cavity, or a tenon on its ends, it is not “continuously worked.” Continuing this analysis to its conclusion, if the merchandise is not “continuously shaped,” then it can not be merchandise of heading 4409, HTSUSA.

Customs’ decision in this Protest is not based on the fact that the merchandise is mortised, tenoned or similarly worked. Customs notes, however, that tongue and grooving is a recognizable joint for assembly similar to the exemplars listed in EN 44.18.

The decision in this Protest rests on the conclusion that “end-worked boards are more advanced than open-ended boards,” more similar to “[b]uilders’ joinery and carpentry” described in heading 4418, HTSUSA, and, therefore, more specifically provided for in heading 4418, HTSUSA, than heading 4409, HTSUSA. See HQ 957528 supra.

HOLDING

The protest is DENIED in full.

The teak wood flooring from Burma, tongued and grooved on the edges and ends, at issue in this Protest is classified in subheading 4418.90.4090, HTSUSA.

The General Column One Rate of Duty is three and two-tenths (3.2) percent ad valorem.

In accordance with Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, section 3 A. (11) (b), you are to mail this decision and the Protest (Customs Form 19) to the Protesant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with this decision must be accomplished prior to mailing the decision.

The Office of Regulations & Rulings will make this decision available to Customs personnel and to the public on the Customs Service Home Page on the World Wide Web, www.customs.gov, by means of the Freedom of Information Act and by other methods of public distribution sixty days from the date of this decision.

Sincerely,

John Durant, Director


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