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HQ 967265




AUGUST 1, 2005

CLA-2 RR:CTF:TCM 967265 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 7208.90.0000/9903.72.60

Port Director
U.S. Customs and Border Protection
2nd & Chestnut Streets, Rm. 102
Philadelphia, PA 19106

RE: Protest 1101-04-100162; Hot-rolled steel circles flame cut from hot- rolled plates; 201 steel safeguard duties; Treatment,19 U.S.C. 1625(c)

Dear Port Director:

This is our decision on Protest 1101-04-1000162, filed by counsel on behalf of World Metals Corp., against your classification, under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), of certain steel circle blanks for tank heads, and your assessment of additional 201 steel safeguard duties.

The goods were entered under a provision of heading 7326, HTSUSA, as other articles of iron or steel, forged or stamped, but not further worked. They were reclassified as other flat-rolled products of iron or nonalloy steel, of a width of 600 mm or more, under a provision of heading 7208, HTSUSA, assessed with additional 201 steel safeguard duties under subheading 9903.72.60, HTSUS, and the entries liquidated on March 12, 2004. This protest was timely filed on May 20, 2004.

Counsel maintains that the correct classification is in subheading 7326.90.8587, HTSUSA, as other articles of iron or steel. If this claim does not prevail, counsel presents an alternative claim that a treatment exists under subheading 7326.19.0000, HTSUSA, which can be modified only in accordance with the notice and comment procedure outlined in 19 U.S.C. 1625(c).

FACTS:

The merchandise at issue is steel circle blanks, products of Brazil. They are disc-shaped articles which are oxyacetylene flame cut from hot-rolled steel plates. After importation, they are heated, then spun into tank heads for use on pressure vessel tank cars for the rail industry and general purpose tanks for the conveyance of water, gas, etc.

The HTSUSA 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

7326 Other articles of iron or steel:
Forged or stamped, but not further worked:

7326.19.00 Other

7326.90 Other:

7326.90.85 Other articles of iron or steel

ISSUE:

Whether the steel circle blanks are flat-rolled products of subheading 7208.90.00; whether a treatment exists for these goods under subheading 7326.19.00.

LAW AND ANALYSIS:

Under General Rule of Interpretation (GRI) 1, HTSUA, goods are to be classified 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.

Chapter 72, Note 1(k), HTSUS, in part defines Flat-rolled products as rolled products of solid rectangular (other than square) cross section, which do not conform to the definition [of semi-finished products] at (ij) [above]. Flat-rolled products of a shape other than rectangular or square, of any size, are to be classified as products of a width of 600 or more, provided that they do not assume the character of articles or products of other headings.

CLASSIFICATION

The original determination that the flame cut steel circles were provided for in subheading 7326.19.0000, HTSUSA, was based on advice provided to the importer/protestant by U.S. Customs and Border Protection (CBP), and was predicated on the belief that the goods were, in fact, made by a stamping process in accordance with Motor Wheel Corp. v. United States,19 CIT 385 (1995). In that case, the Court found that circular or octagonal shapes cut from flat-rolled steel by an automated cookie cutter process sufficiently advanced the flat-rolled steel such that the resulting blank, created in a single press stroke, as by a stamp, was distinct from the flat-rolled steel and had, in fact, become a stamped article of iron or steel. Circles and octagons are shapes that are other than rectangular or square. Because subheading 7326.19, HTSUSA, includes the phrase “forged or stamped, but not further worked,” the Court held that the circular shapes had assumed the character of goods of another heading and were classifiable as other articles of iron or steel, forged or stamped, but not further worked, in subheading 7326.19.0000, HTSUSA.

However, the steel circle blanks at issue here, which are oxyacetylene flame cut from hot-rolled steel plates, are not produced by a recognized stamping process and, therefore, are not stamped articles of the type classifiable in subheading 7326.19.0000, HTSUSA. See HQ 963255, dated April 28, 2000, NY I82305, dated June14, 2002, and related cases. The steel circle blanks remain flat-rolled products of iron or non-alloy steel, classifiable in subheading 7208.90.0000, HTSUSA. Goods so classified are subject to the assessment of additional so-called steel safeguard duties (“Section 201 Duties”) on this merchandise under subheading 9903.72.60, HTSUS, pursuant to Presidential Proclamation 7529, issued on March 5, 2002 (Federal Register, Vol. 67, No. 45, March 7, 2002).

TREATMENT

CBP agrees with counsel that a treatment existed on behalf of World Metals Inc., with respect to this merchandise under subheading 7326.19.0000, HTSUSA. However, in accordance with 19 U.S.C. 1625(c) and section 177.12(c), CBP regulations, CBP published a notice in the June 22, 2005 Customs Bulletin, Vol. 39, No. 26, advising interested parties of the revocation of this treatment pursuant to HQ 967410, dated June 6, 2005. Additionally, pursuant to 19 U.S.C. 1625(c)(2), the treatment previously accorded by CBP to substantially identical transactions of other importers was also revoked.

HOLDING:

Under the authority of GRI 1, the flame cut nonalloy steel circles are provided for in heading 7208. They are classifiable in subheading 7208.90.0000, HTSUSA. The protest should be DENIED as to classification. However, the protest should be ALLOWED as to the treatment classifying World Metals Inc., importations of steel circle blanks oxyacetylene flame cut from hot rolled steel plates in subheading 7326.10.0000, HTSUSA, entered or withdrawn from warehouse on or before August 20, 2005.

In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), 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 in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles B. Harmon, Director
Commercial and Trade Facilitation Division


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