United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 2008 HQ Rulings > HQ 560274 - HQ H015873 > HQ H009368

Previous Ruling Next Ruling
HQ H009368




September 27, 2007

CLA-2 OT:RR:CTF:TCM H009368 ARM

CATEGORY: CLASSIFICATION MARKING

TARIFF NO.: 3402.20.51

Ms. Sabrina Johnson
Tremco
215 Wicksteed Ave.
Toronto, Ontario M4H 1G7

RE: Classification and Origin of Bondex Surface Preparation Kit

Dear Ms. Johnson:

This is in reply to your request submitted on March 26, 2007, seeking a binding ruling concerning the classification and origin determination of a Bondex Surface Preparation Kit. The kit consists of three items packaged together in a single tub for the purpose of prepping pool surfaces, under the Harmonized Tariff Schedule of the United States (HTSUS). We have also considered your submission dated July 25, 2007, in which a copy of the label for the bucket was attached. By telephone conversation of September 10, 2007, you confirmed that the label indicating the Ramuc brand is the same as Bondex Surface Preparation Kit and that it would contain T.S.P. substitute, consisting of tri-sodium phosphate (T.S.P.) and sodium carbonate, rather than T.S.P.

FACTS:

The merchandise at issue is a 2 gallon plastic bucket labeled Bondex Surface Preparation Kit. The kit contains 2 cartons (1 lb. each) of T.S.P. substitute (a mixture of T.S.P. and sodium carbonate) manufactured in Canada, three cartons (12 oz. each) of sulfamic acid based concrete cleaning and etching compound manufactured in China, and one carton of 5 pound hydraulic cement manufactured in Canada. The T.S.P. substitute is an all-purpose cleaner used prior to painting exterior surfaces. It removes mold and mildew and de-glosses surfaces to be painted. The sulfamic acid compound provides a light surface etch to promote coating adhesion over a variety of smooth masonry surfaces. The cement is used for the plugging and sealing of holes in concrete. The cost of the cement and T.S.P. substitute are about equal and the cost of the etching compound is about half that of the other two items.

The print on the outer bucket state “Step 1: Wash with T.S.P. substitute; Patch any cracks before etching; Step 2 Etch with concrete etching crystals.” The directions on the back of the bucket also include directions as to other uses for each compound. For instance, the T.S.P. substitute “will remove oil and grease from basement or garage floors, driveways and machinery.” The Concrete etching crystals may be applied “on concrete, stone, brick and tel.” The cement “may also be used to anchor bolts, hooks and machinery into concrete or masonry floors and walls.” However, Internet stores advertise the item with the additional language that “the kit “contains enough material to prepare a 15” x 30” (800 square feet) painted pool. Use two kits for unpainted surfaces.” http://www.h2opoolproducts.com/product_info.php?cPath=52&products_id=741&osCsid=o1uo733kcqspjth6ii72m5eqo0.

ISSUES:

Is the subject merchandise classifiable as goods put up in sets for retail sale under GRI 3(b) or are the items classified separately?

If as a set, what is the classification of the entire set?

What is the country of origin for the kit and how is it to be marked?

LAW AND ANALYSIS:

Classification:

Classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.

When interpreting and implementing the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. Customs and Border Protection (CBP) believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

The classification of each item in the kit is not in dispute. The T.S.P. substitute is classified in subheading 3402.20.51, HTSUS, the provision for: “Organic surface-active agents (other than soap); surface-active preparations, washing preparations (including auxiliary washing preparations) and cleaning preparations, whether or not containing soap, other than those of heading 3401: Organic surface-active agents, whether or not put up for retail sale: Preparations put up for retail sale: Other.” The sulfamic acid based cleaning and etching compound is classified in subheading 2811.19.60, HTSUS, the provision for “Other inorganic acids and other inorganic oxygen compounds of nonmetals: Other inorganic acids: Other: Other.” The hydraulic cement is classified in subheading 2523.90.00, HTSUS, the provision for: “Portland cement, aluminous cement, slag cement, supersulfate cement and similar hydraulic cements, whether or not colored or in the form of clinkers: Other hydraulic cements.”

Because the kit contains articles classified in different headings, the classification question arises under GRI 3 as to whether the merchandise constitutes a set put up for retail sale and therefore may be classified together, or whether the articles must be classified separately in their respective headings.

To determine whether the merchandise constitutes a set, GRI 3(b) states that:

[m]ixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

Explanatory Note (X) to GRI 3(b)(p. 4) states that:

[f]or the purpose of this Rule, the term "goods put up in sets for retail sale" shall be taken to mean goods which:

(a) consist of at least two different articles which are, prima facie, classifiable in different headings . . .;

(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and

(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).

The instant swimming pool surface preparation kit consists of three articles classified in different headings as stated above. The products are put up together to meet the particular need of preparing a swimming pool for painting. While the products could be purchased separately for any concrete cleaning and patching job, here they are put up specifically labeled for the cleaning and patching of a pool and in the quantities for one application of an average size pool’s surface, and include directions related to the cleaning and patching of a pool. One would not likely purchase this entire kit simply to keep the items on a shelf for odd concrete patching or cleaning jobs, even though directions for doing so are provided, because each of the items are readily available separately. The two gallon outer bucket qualifies as a manner suitable for sale directly to users without repacking. Hence, we find that the instant merchandise qualifies as goods put up in sets for retail sale under GRI 3(b).

The factor which determines essential character may be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods (EN (VIII) to GRI 3(b)). You believe that the sulfamic acid gives the set its essential character under GRI 3(b) because “the T.S.P. merely prepares the concrete for the acid and the concrete patch is only used in spots if needed.” To determine the essential character of a good, we look to a variety of factors, not just the relation of the component to the end use of the product. In the instant case, the set contains 2 containers of T.S.P. totaling 2 lb, 3 containers of Sulfamic acid etching compound, totaling 36 oz., or just over 2 lb and one container of 5 lbs of concrete patch. The value of the T.S.P. substitute and concrete are about equal and are almost twice that of the value of the etching compound.

The article providing the greatest bulk and weight of the surface preparation kit is the concrete. The greatest quantity of items is the sulfamic acid. The item with the greatest value is the concrete with the T.S.P. substitute a close second. Also, the role of each item for purchasers of the kit would probably be equal, because if one needed only to clean the pool, one would only buy the T.S.P. substitute, and if one were preparing it for painting, one would buy the cleaning and etching compound, and if one were only patching and painting, one would buy only the concrete. A purchaser of this kit is probably engaged in a thorough cleaning, patching and preparation for painting. Given these factors, CBP concludes that none of the items imparts the kit’s essential character. Therefore, under GRI 3(c), we find that the surface preparation kit is classified in subheading 3402.20.51, HTSUS, the provision for: “Organic surface-active agents (other than soap); surface-active preparations, washing preparations (including auxiliary washing preparations) and cleaning preparations, whether or not containing soap, other than those of heading 3401: Organic surface-active agents, whether or not put up for retail sale: Preparations put up for retail sale: Other.” , for the T.S.P. substitute, the article classified in the last heading amongst those meriting equal consideration.

Marking

Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304), provides that unless excepted, every article of foreign origin imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or container) will permit in such a manner as to indicate to an ultimate purchaser in the United States the English name of the country of origin of the article. Congressional intent in enacting 19 U.S.C. 1304 was that the ultimate purchaser should be able to know by an inspection of the markings on the imported goods the country of which the good is the product. "The evident purpose is to mark the goods so at the time of purchase the ultimate purchaser may, by knowing where the goods were produced, be able to buy or refuse to buy them, if such marking should influence his will." United States v. Friedlaender & Co., 27 C.C.P.A. 297 at 302 (1940).

Part 134, Customs and Border Protection (CBP) Regulations (19 C.F.R. 134), implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304. Section 134.1(b), CBP Regulations (19 C.F.R. 134.1(b)), defines "country of origin" as “the country of manufacture, production, or growth of any article of foreign origin entering the United States. Further work or material added to an article in another country must effect a substantial transformation in order to render such other country the "country of origin" within the meaning of this part; however, for a good of a NAFTA country, the NAFTA Marking Rules determine the country of origin.”

Section 134.1(j), CBP Regulations (19 C.F.R. 134.1(j)), provides that the "NAFTA Marking Rules" are “the rules promulgated for purposes of determining whether a good is a good of a NAFTA country.” Section 134.1(g), CBP Regulations (19 C.F.R. 134.1(g)), defines a "good of a NAFTA country" as “an article for which the country of origin is Canada, Mexico or the United States as determined under the NAFTA Marking Rules.” As the T.S.P. substitute and hydraulic cement are manufactured in Canada, and the kit is assembled in Canada prior to importation into the United States, we must refer to the NAFTA Marking Rules which are set forth at 19 C.F.R. Part 102.

Within Part 102, the applicable rule is stated under 19 CFR §102.11(c), which states:

Where the country of origin cannot be determined under paragraph (a) or (b) of this section and the good is specifically described in the Harmonized System as a set or mixture, or classified as a set, mixture or composite good pursuant to General Rule of interpretation 3, the country of origin of the good is the country or countries of origin of all materials that merit equal consideration for determining the essential character of the good.

Paragraph (a) is inapplicable here because the good is not wholly obtained or produced in a single country, nor is it produced exclusively from domestic materials, nor does it undergo a change in tariff classification as set out in §102.20. Paragraph (b) is inapplicable because goods put up in sets for retail sale under GRI 3(b) are excepted from the terms of the paragraph. Therefore, in accordance with 19 CFR §102.11(c), the country of origin of the Bondex Preparation Kit is Canada and China.

The two gallon bucket containing the entire kit must be marked with a statement indicating origin in accordance with Section 304 of the Tariff Act of 1930, as amended (19 U.S.C. 1304). Section 134.24(d)(2) of Title 19 of the Code of Federal Regulations (19 CFR §134.24(d)(2)) provides the applicable rule:

(2)Sealed containers or holders. Disposable containers or holders of imported merchandise, which are sold without normally being opened by the ultimate purchaser (e.g., individually wrapped soap bars or tennis balls in a vacuum sealed can), shall be marked to indicate the country of origin of their contents.

Under Treasury Decision (T.D.) 91-7, dated January 16, 1991, kits or their packages must be marked so as to show the origin of every major component of the kit (see also Headquarters Ruling Letter (HQ) 559067, dated September 19, 1995, HQ 559032, dated October 25, 1995, and HQ 735009, dated July 30, 1993). Therefore, the outer sealed bucket should be marked with a statement such as “T.S.P. substitute and hydraulic cement made in Canada, sulfamic acid etching compound made in China” or its equivalent.

HOLDING:

By application of GRI 3(c), the Bondex Surface Preparation Kit is classified in heading 3402, specifically in subheading 3402.20.51, HTSUS, the provision for “Organic surface-active agents (other than soap); surface-active preparations, washing preparations (including auxiliary washing preparations) and cleaning preparations, whether or not containing soap, other than those of heading 3401: Organic surface-active agents, whether or not put up for retail sale: Preparations put up for retail sale: Other.” The column one general rate of duty is “free.”

In accordance with 19 U.S.C. §1304, 19 CFR §102.11(c), 19 CFR §134.24(d)(2) and T.D. 91-7, the two gallon bucket containing the entire kit must be marked with a statement as to the T.S.P. substitute and hydraulic cement originating in Canada and the sulfamic acid etching compound originating in China.

Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.

Sincerely,

Gail A. Hamill, Chief

Previous Ruling Next Ruling

See also: