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HQ 964026




September 27, 2002

CLA-2 RR:TC:TE 964026 STB

CATEGORY: CLASSIFICATION

TARIFF NO.: 6002.20.6000

Ms. Nora Ehrlich
Port Director
United States Customs Service
10 Causeway Street
Suite 603
Boston, MA 02222

RE: Tariff Classification of “Oxyphan® PP50/280 Capillary Membrane”

Dear Ms. Ehrlich:

This is in response to an Application for Further Review of Protest Number 0401-98-100201 timely filed by Sharrets, Paley, Carter & Blauvelt, P.C., on behalf of C.R. Bard, Inc., against your classification of C.R. Bard’s product invoiced as “Oxyphan® Capillary Membrane for Oxygenation / Oxyphan PP50/280 / Cross Wound Sealed Knitted Mat” (hereinafter also referred to as “fiber membrane”) under the Harmonized Tariff Schedule of the United States, Annotated (HTSUSA). No sample was submitted with the file but a sample of the merchandise as imported, and a sample of the device into which the finished item is inserted for use, were subsequently obtained from the law firm representing the protestant.

This protest involves a product which is similar, but not identical, and different for tariff classification purposes, to one which has been previously ruled upon by U.S. Customs and the Customs courts. Distinguishing facts and alternative legal arguments are presented which were not considered at the time of the administrative and judicial decisions with respect to the previously considered product. Therefore, this matter involves questions of law or fact which have not been ruled upon by Customs Service Headquarters or the Customs courts and acceptance for review of the Application for Further Review is appropriate under either title 19, Code of Federal Regulations (C.F.R.), sections 174.24(b) and 174.26(b)(1)(iv) or 19 C.F.R., sections 174.24(c) and 174.26(b)(1)(iii).

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FACTS:

The subject merchandise is described by protestant’s counsel as a double layer mat of polypropylene hollow fibers which are held together in the mat configuration by knitting. This description is provided in the Memorandum in Support of Protest and Application for Further Review (hereinafter also referred to as “memorandum” and “submission.”) Counsel states in the memorandum that the product is used in membrane oxygenators to oxygenate a patient’s blood during surgery, and describes the process as follows:

This is accomplished by having oxygen and blood flow through the oxygenator on independent paths which are segregated by the Oxyphan PP50/280 membrane. The membrane walls allow the transfer of oxygen molecules to the blood through diffusion across the permeable membrane. The membrane can also provide for removal of carbon dioxide from the blood by diffusion in the reverse direction. However, the membrane walls do not permit the blood to cross the membrane.

Counsel further states that the merchandise is imported on reels. One reel of the fiber membrane mat can be used to make more than one oxygenator; the membrane mat is cut after use on each oxygenator and the protestant’s oxygenator manufacturing equipment reattaches the two layers.

The fiber membrane was originally entered by the importer under subheading 9018.90.8000, HTSUSA, which provides for “[I]nstruments and appliances used in medical, surgical, dental or veterinary sciences...; parts and accessories thereof:...Other,” at a free rate of duty.

Upon liquidation, the import specialist at the Port of Boston reclassified the merchandise under subheading 6002.20.6000, HTSUSA, which provides for “[O]ther knitted or crocheted fabrics,...Other, of a width not exceeding 30 cm: Other: of man-made fibers,” at a general column-one duty rate of 8.3 percent (1997) or 8.2 percent (1998).

In their memorandum, counsel argues that the fiber membrane should, instead, be classified in one of the following six (6) provisions or subheadings (i.e., if not one, then another):

9019.20.00, HTSUSA, the provision for “Ozone therapy, oxygen therapy, aerosol therapy, artificial respiration or other therapeutic respiration apparatus; parts and accessories thereof”;

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9018.90.75, HTSUSA, the provision for “Instruments and appliances used in medical, surgical, dental or veterinary sciences;parts and accessories thereof: Other instruments and appliances and parts and accessories thereof: Other: Electro-medical instruments and appliances and parts and accessories thereof: Other: Other”;

9018.90.60, HTSUSA, the provision for “Instruments and appliances used in medical, surgical, dental or veterinary sciences; parts and accessories thereof: Other instruments and appliances and parts and accessories thereof: Other: Electro-medical instruments and appliances and parts and accessories thereof: Electro-surgical instruments and appliances, other than extracorporeal shock wave lithotripters; all the foregoing and parts and accessories thereof”;

9018.90.80, HTSUSA, the importer’s original classification, and the provision for “Instruments and appliances used in medical, surgical, dental or veterinary sciences; parts and accessories thereof: Other instruments and appliances and parts and accessories thereof: Other: Other”;

5911.90.00, HTSUSA, the provision for “Textile products and articles, for technical uses, specified in note 7 to this chapter: Other,” or;

5404.10.80, HTSUSA, the provision for “Synthetic monofilament of 67 decitex or more and of which no cross-sectional dimension exceeds 1 mm: Monofilament: Other: Other.”

On September 24, 2002, at the request of counsel, a telephone conference was conducted concerning this matter. Participants in the conference included an attorney representing protestant and two attorneys from the Office of Regulations and Rulings (OR&R), Headquarters, U.S. Customs Service.

ISSUE:

What is the classification, pursuant to the Harmonized Tariff Schedule of the United States Annotated, of the subject fiber membrane material?

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI’s) set forth the manner in which merchandise is to be classified under the HTSUSA. GRI 1 requires that classification be determined first according to the terms of the headings of the

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tariff and any relative section or chapter notes and, unless otherwise required, according to the remaining GRI’s taken in order. It appears that GRI 1 governs the classification of the subject merchandise in this instance.

The Explanatory Notes constitute the official interpretation of the Harmonized System at the international level. See Joint Explanatory Statement supra note 2, at 549. The Explanatory Notes, although neither legally binding nor dispositive of classification issues, do provide commentary on the scope of each heading of the HTSUSA. The EN’s are generally indicative of the proper interpretation of the headings. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989); Lonza, Inc. v. United States, 46 F. 3rd 1098, 1109 (Fed. Cir. 1995).

First we address counsel’s claims for classification in various subheadings of Chapter 90, HTSUSA, which includes four (4) of the six (6) possible classifications claimed in protestant’s submission (1 through 4, above). The subject fiber membrane material is excluded from classification in Chapter 90 because, since the merchandise must be further processed, it cannot be considered a part of the medical instrument or appliance (the oxygenator). Baxter Healthcare Corp. of Puerto Rico v. United States, 182 F.2d 1333, July 2, 1999 (Rehearing denied, September 20, 1999); See also, HQ 954822, dated December 22, 1994.

In Baxter, the appellate court affirmed the decision of the lower court and agreed with the Government that a material similar to the subject merchandise cannot be classified in Chapter 90, HTSUSA. The court noted, in part, that:

In this case, it is undisputed that each roll of Oxyphan® contributes materially to approximately four oxygenators. At the time of import, the individual parts cannot be discerned from the roll, and the roll nowhere marks or otherwise identifies the individual parts to be made from it.... The exact length needed per oxygenator is not known until the oxygenator is made. Because the individual parts are not identified or fixed at the time of import, Oxyphan® cannot be classified as a “part” of an oxygenator.

Since we agree with the government that Oxyphan® is not a “part” of an oxygenator for classification purposes, we need not decide whether an oxygenator is an “artificial respiration apparatus” under heading 9019. Similarly, we need not decide whether an oxygenator is an “electro- surgical instrument” under heading 9018.

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Id, at page 1339. The court concluded in Baxter that “The Court of International Trade correctly determined that Customs correctly classified the imported Oxyphan® membrane under subheading 5404.10.80.”

Counsel states in the memorandum that, in the event that the claimed possible subheadings of Chapter 90 are found to be inapplicable to the subject membrane, then “protestant claims that its membrane is properly classifiable in subheading 5911.90.00, HTSUSA.” Counsel argues that:

As a double layer mat of fibers held together in the mat configuration by knitting, the protestant’s membrane is not merely a textile product in the piece, cut to length or simply cut to rectangular (including square) shape, as provided for in subsection (a) of Note 7, Chapter 59. However, it is a textile article of a kind used for technical purposes, as specified in subsection (b) of that note.

As a basis for this claim, counsel states that:

At page 902, the Explanatory Notes provide several exemplars of merchandise considered to be “textile articles of a kind used for technical purposes” within the meaning of Note 7(b). The first example listed is “[a]ny of the fabrics [covered by Note 7(a), Chapter 59] which have been made up (cut to shape, assembled by sewing, etc.)....” (Emphasis added). Thus, if fabrics, cloths, or other textile materials are assembled together into new goods by sewing, then the resulting goods are “textile articles” for purposes of Note 7(b), Chapter 59. The subject membranes consist of sheets of fibrous material which have been assembled into mats by knitting. Therefore, they are “textile articles” for purposes of Note 7(b), Chapter 59 [footnote omitted].

Furthermore, the subject membranes are used for technical purposes. In this regard, the Explanatory Notes, at page 901, provide that the textile products and articles of heading 5911 present particular characteristics which identify them as being for use in various types of machinery, apparatus, equipment or instruments or as tools or parts of tools. The particular characteristics of the protestant’s membrane which identify it as being for use with its oxygenator are the uniformity and size of the pores, which are large enough for oxygen and carbon dioxide molecules to pass and small enough to minimize plasma breakthrough.These inherent characteristics of the subject membrane demonstrate that the article is “for technical uses” within the meaning of heading 5911.Finally, Customs itself has previously ruled that the use of

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an article in a blood oxygenator constitutes a technical use within the meaning of heading 5911. See Customs Ruling NY B87999 (Aug. 14, 1997).

Regarding the Baxter case, counsel claims in the memorandum that “[T]here is no indication that the membrane at issue therein was a mat consisting of two layers knitted together” (as is the subject membrane), and that this fact probably explains why subheading 5911.90.00, HTSUSA, was not considered as a possible classification in that case.

We find that the subject fiber membrane is not appropriately classified in subheading 5911.90.00, HTSUSA. As mentioned above, counsel cites the explanatory notes, which explain that “[a]ny of the fabrics [covered by Note 7(a), Chapter 59] which have been made up (cut to shape, assembled by sewing, etc.)” can be a textile article for technical uses as classified in Heading 5911. However, we note that the subject fiber membrane is not one of the fabrics covered by Chapter Note 7(a), thereby rendering counsel’s analysis inapposite to the classification of the fiber membrane. The subject fiber membrane material is not a fabric of 7(a)(i), all of which have some type of coating or covering (the subject membrane does not) and nor is it, by definition, any of the fabrics listed in 7(a)(ii) through 7(a)(vi). Additionally, since the fiber membrane requires further processing after importation before it can be used for its intended purpose, it is not really a textile “article” at the time of importation.

Since the subject fiber membrane material is not a “textile article” of heading 5911, HTSUSA, as explained, above, we need not address whether the material is “for technical uses,” as argued by counsel. (In support of that argument counsel cites, in the memorandum, NY B87999, dated August 14, 1997.)

In the telephone conference of September 24, 2002, counsel for the protestant raised the question of whether the two layers of fiber material are, in fact, held together by “knitting” or whether knitting of any kind is actually involved in the construction of the subject material. Counsel stated that he had not, recently, viewed a sample of the material.

As has been referenced several times herein, we note that, in the memorandum, an attorney for protestant repeatedly refers to the article as an article which has been subject to the knitting process. Moreover, the article is described by protestant in the invoices as “Cross Wound Sealed Knitted Mat.” Examination by Customs National Import Specialists revealed the presence of knitting and our own examination shows that the warp yarns are knit. Therefore, we find that the subject material is a knitted item.

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Counsel also argued, in the telephone conference, that the subject material may, in fact, constitute an “article” despite the need for further processing after importation. He further argued for a more expansive view of what fabrics are included (as textile articles) for classification in Chapter 59 by notes 7(a) and 7(b).

We disagree with these arguments as well. We have reviewed the Customs rulings cited by counsel during the conference and find that they are not persuasive in supporting the classification of the subject material as an “article.” We also note that the subject material does not qualify as a “made-up” article under the Section XI notes. Section XI, Note 7(e) states as follows:

For the purposes of this section, the expression “made up” means:

...

Assembled by sewing, gumming or otherwise (other than piece goods consisting of two or more lengths of identical material joined end to end and piece goods composed of two or more textiles assembled in layers, whether or not padded); or...

As the subject article consists of many lengths of identical material joined end to end, assembled into layers, such construction does not make it a “made up” textile article as described by the Explanatory Notes (at p. 902). Regarding Chapter 59, Note 7(a), we further point out the use of the word “only” in that note in limiting what is included therein.

Finally, counsel claims that, in the event that Customs does not agree that the subheadings of Chapter 90, listed above, or subheading 5911.90.00, HTSUSA, are applicable, then the fiber membrane is properly classifiable in subheading 5404.10.80, HTSUSA, the provision under which the membrane in Baxter was classified. Counsel also states that the subject merchandise covered by three entries at issue are classifiable as entered because Customs liquidated those entries more than one year after the date of entry and that, therefore, the liquidations are deemed final pursuant to 19 U.S.C., section 1504(a). Counsel cites, for this proposition, United States v. Cherry Hill Textiles, Inc., 112 F.3d 1550 (Fed. Cir. 1997).

We find that these claims are incorrect, also. As indicated in counsel’s submission, the material under discussion is a “double layer mat of polypropylene hollow fibers which are held together in the mat configuration by knitting” (emphasis added). Our examination of the sample submitted indicates

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that the two layers of material have, indeed, been subjected to a knitting process in which they have been knitted together at the ends, similar to a knit fabric with a laid in yarn. Therefore, due to this knitting process, the subject material is taken out of the 5404 heading (of Baxter) and must be classified as a knitted fabric, which, at the time of entry, was in heading 6002, HTSUSA. A similar result was reached in NY 873480, dated May 5, 1992. The material at issue here, although similar, is different from that at issue in Baxter; that case addressed the classification of a single fiber membrane. Regarding liquidation, our records show that, with regard to the three (3) entries identified by counsel, extensions of the period for liquidation were obtained in accordance with 19 U.S.C., section 1504(b); the subsequent liquidations occurred within the time period allowed by the one (1) year extensions.

HOLDING:

The fiber membrane was properly classified at subheading 6002.20.6000, HTSUSA, which, at the time of liquidation, was the provision for “other knitted or crocheted fabricsOther, of a width not exceeding 30 cm: Other: of man-made fibers.” The column-one duty rate for this provision was 8.3 percent in 1997 and 8.2 percent in 1998.

The corresponding present-day (2002) provision is subheading 6003.30.6000, HTSUSA, with a column-one duty rate of 7.8 percent.

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 are to 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 make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles B. Harmon, Acting Director

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