us-cbp-cross-rulings-hq-082506•HQ 082506: Decision on Application for Further Review of Protest No. 4501-7-000065, classification of Phostex and Gastoxin.
HQ 082506: Decision on Application for Further Review of Protest No. 4501-7-000065, classification of Phostex and Gastoxin.
us-cbp-cross-rulings-hq-082506HQ 082506: Decision on Application for Further Review of Protest No. 4501-7-000065, classification of Phostex and Gastoxin.Guidance
Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.
HQ 082506
March 3, 1989
CLA-2 CO:R:C:G 082506 SS
CATEGORY: Classification
TARIFF NO: TSUS 432.15 (432.10)
District Director of Customs
7911 Forsythe Blvd.
St. Louis, Missouri 63105
RE: Decision on Application for Further Review of Protest
No. 4501-7-000065, classification of Phostex and Gastoxin.
Dear Sir:
This is our decision on Application For Further Review of
protest No.4501-7000065.
FACTS:
The imported products, Gastoxin and Phostex, are
restricted use pesticides in pellet or tablet form. The brief
submitted by counsel on behalf of the importer states the
following facts:
Gastoxin and Phostex are identical in both chemical
composition and use. They contain one active ingredient,
aluminum phosphide, which is 57 percent of the product by
weight. The aluminum phosphide reacts quickly with moisture
to release phosphine, a colorless and odorless gas. A warning
label is attached to each flask of Gastoxin and Phostex.
In addition, Gastoxin and Phostex contain inert
ingredients in varying quantities. Some of these ingredients
are added to give bulk (weight and volume) to the product,
lubricate other ingredients during the manufacturing process,
dilute the phosphine gas discharge in order to reduce its
flammability, and produce a pungent odor as a warning agent
while the pesticidal action occurs.
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Gastoxin and Phostex also contain five percent of an
organic compound, paraffin, which is a derivative of petroleum.
The paraffin is added for the sole purpose of retarding the
chemical reaction between the active ingredient, phosphide,
and atmospheric moisture. This delay allows people working
with Gastoxin and Phostex time to leave the area without the
risk of exposure to phosphine gas. The length of time the
paraffin acts as a retardant depends upon the thickness of the
paraffin coating, the temperature of the tablet and pellet, and
relative humidity of the atmosphere. A five percent by weight
paraffin coating will produce a retardant effect for a period
up to four hours from the time the seal is broken on the
aluminum flask.
During manufacture, each tablet or pellet of Gastoxin or
Phostex is coated with a thin layer of paraffin, which acts as
a temporary seal. The sealed tablets or pellets are stored
before and after sale to the consumer in hermetically sealed
flasks of seamless aluminum. Gastoxin and Phostex are applied
by exposing the tablets or pellets to the air in or near the
product for the pesticidal action, in an enclosed area such as
a grain elevator or a tobacco storage warehouse.
As soon as the flasks are opened, moisture begins to
penetrate the cracks in the paraffin coating. When the
chemical reaction of the active ingredient begins, the paraffin
breaks up into a powder. The paraffin in no way contributes to
the pesticidal action. A disposable powdery mass of paraffin
and other chemical residue remains at the end of the chemical
process.
ISSUE:
Are the products in question, Gastoxin and Phostex
properly classifiable under the provision for mixtures not
specifically provided for:
Item
432.10.. Mixtures that are in whole or in part of
hydrocarbons derived in whole or in part
from petroleum, shale oil, or natural
gas.....
or under the inferior provision:
Other:
432.15 Pesticides.......?
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LAW AND ANALYSIS:
Counsel, on behalf of the importer, has submitted two
separate briefs in support of the position that the products in
issue are properly classified under the inferior heading,
Other: Pesticides, in item 432.15, rather than under the
superior heading, Mixtures that are in whole or in part of
hydrocarbons derived from petroleum, shale oil, or natural gas,
in item 432.10, TSUS.
In the first brief, counsel argues that the products are
properly classifiable under the eo nomine provision for
pesticides, item 432.15, TSUS, and that further review is
justified in this protest because the identical product is
imported into other districts in the United States under item,
432.15, TSUS.
Counsel claims in the second brief that as a matter of
law, the product is "not in whole or in part of" the
hydrocarbons described in item 432.10, TSUS, and that there
exists an established and uniform practice of classifying the
product in item 432.15, TSUS, which practice Customs may not
change without providing proper notice.
Headnote 10, General Headnotes and Rules of Interpreta-
tion, TSUS, provides in pertinent part:
(c) an imported article which is described in two
or more provisions of the schedules is classifiable in the
provision which most specifically describes it; but in applying
this rule of interpretation, the following considerations shall
govern:
(i) A superior heading cannot be enlarged by an
inferior heading indented under it but can be limited thereby;
(ii) comparisons are to be made only between
provisions of coordinate or equal status, i.e., between the
primary or main superior heading of the schedules or between
coordinate inferior headings which are subordinate to the same
superior heading;
Based on the facts presented, the product in issue is
described in both items 432.10 and 432.15. Counsel for the
importer argues that the product is properly classifiable under
item 432.15 because the designation of products by name takes
precedence over terms of general description. Counsel further
argues that item 432.10 is inappropriate because this general
category is clearly limited by the unqualified eo nomine tariff
provision in item 432.15.
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While it is true that under the rules of construction,
TSUS, an article is properly classifiable under the provision
which most specifically describes it, such classification must
also be governed by all the applicable general interpretative
rules.
Applying the above rules and principles of statutory
construction, if the product is described in the superior
heading in item 432.10, then the product is necessarily
classified under this item. It is only necessary to resort to
the heading, other, item 432.15, if the product to be
classified is not described in the first competing superior
heading.
Further, the rules of statutory construction of TSUS also
allow only comparisons of equal headings, i.e., Mixtures that
are in whole or part of hydrocarbon... versus, Other.. Again,
as the general interpretative rules make plain, "(i) a superior
heading cannot be enlarged by an inferior heading under it but
can be limited thereby." Headnote 10, (c) (i). Counsel's
argument to classify the products in issue under the provision
for pesticides would mean comparing unequal headings and
enlarging the inferior heading, which is contrary to the above-
mentioned rule. This cannot be done.
Therefore, in light of the foregoing, counsel's argument
that the products in issue are properly classifiable under the
provision for pesticides, because the products are eo nomine
specific, must necessarily fail.
However, in determining whether the presence of some
ingredient in a product affects its classification, the issue
must be determined on each case on the basis of the character
of the article and the language and purpose of the tariff
provision. Canada Dry Ginger Ale, Inc., v. United States, 43.
Cust. Ct.1, C.D.2094 (1959), appeal dismissed, 47 CCPA 173
(1959).
General Headnote 9 (f) (iv) TSUS, provides:
(iv) "in part of" or "containing" mean that the article
contains a significant quantity of the named material.
With regard to the application of the quantitative concepts
specified in subparagraph....(iv) above, it is intended that
the de mimimis rule apply.
In attempting to minimize problems arising out of the
language of the above headnote, the revised schedules, TSUS,
proposed that the provisions based on the "in part of" concept
have been kept to a minimum, and where it is used the intention
is that the component material be present in commercially
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significant amount. Tariff Classification Study of the U.S.
Tariff Commission (now the International Trade commission)
(Explanatory Notes, Volume 1, at 14; November 15, 1960).
In determining whether the presence of a small quantity of
an ingredient is "in part" of an imported product for tariff
classification purposes, the courts apply a quantitative -
functional test. Under this two part test the functional
aspect of the "in part" ingredient is satisfied if the partial
ingredient upon which classification is premised has a
principal function. If this functional test is not satisfied,
then the only other justification for allowing a partial
ingredient to control classification is its presence in a
quantity which has some independent commercial significance.
F.W. Myers 7 Co., Inc. v. United States, 85 Cust. Ct. C.D.4876.
83, 86.
For example, in United States v. Cavalier Shipping Co.,
Inc., 478 F.2d 1256 (1973), 2 percent chloropicrin was added as
a warning agent to a pesticidal mixture of methyl bromide. In
holding that the chloropicrin fell within the scope of the de
minimis exception for tariff purposes, the court stated that
the chloropicrin in the importation did not serve a pesticidal
purpose, nor was present in commercially meaningfully
quantities. Id at 1258.
Also, in United States v. Aceto Chemical Co., Inc., 553
F.2d 685 (1977) (United States Court of Customs and Patent
Appeals), the court held that a fungicide containing less than
one percent benzenoid product as a wetting agent, was properly
classifiable by the principal ingredient, thiuram, under item
425.36, TSUS. In making its decision, the court stated that
the benzenoid ingredient falls within the de minimis status
because it does not participate in the primary function of the
product, but exhausts its function before the principal
ingredient begins to operate. Id at 688-689.
If the functional test is satisfied, an ingredient in an
imported product may control classification of that product if
that quantity has some "independent commercial significance".
For example, in a thorough review of the issue of the
significance of an ingredient that is a part of a product, the
appellate court in Varsity Watch Co. v. United States, 34 CCPA
155, C.A.D. 359 (1947), discussed the de minimis rule. In
Varsity Watch Co., a small amount of gold was applied to the
bezel of a watch case which gave the appearance of gold and
increased salability of the item. The court held that the
watch was classifiable "in part of gold" irrespective of the
minute quantity of gold thereon. In making its decision the
court stated that an ingredient or component may or may not be
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disregarded for tariff purposes not necessarily because of the
quantity present, but on the basis of varying circumstances,
including Congressional intent, and whether or not the amount
of material has changed the nature of the article or its
salability. Id. at 163 (citations omitted). See also Genender
Wholesale v. United States, 1 C.I.T. 278, 520 F. Supp. 278
(1981).
In applying the above cited two part test to the products
in question, it is noted that the paraffin component of the
product does not meet either part of the test. The primary
function of the products in issue is pesticidal. The paraffin
component of the products in no way contributes to the
pesticidal action, but serves mainly as a protective coating
for the pesticide. Further, in accordance with the above cited
headnotes and case law, the paraffin in no way changes the
nature of the products, nor enhances the value of the product
thus serving any "independent commercial purpose."
HOLDING:
The products in issue, Gastoxin and Phostex, are properly
classifiable under TSUS item 432.15, other, pesticides.
Since this case is decided on the above basis, this office
will not address importer's argument of an established and
uniform practice.
The protest should be allowed.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc: Area Director, New York Seaport
2cc: Chief, CIE
1cc: Regional Commissioner, Chicago, Illinois
1cc: Regulatory Trade Programs Division
SSingh:jaj:1/30/89
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