us-cbp-cross-rulings-hq-082905•HQ 082905: Classification of structural pipe for use as insert piles in an offshore drilling and production platform
HQ 082905: Classification of structural pipe for use as insert piles in an offshore drilling and production platform
us-cbp-cross-rulings-hq-082905HQ 082905: Classification of structural pipe for use as insert piles in an offshore drilling and production platformGuidance
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 082905
October 21, 1988
CLA-2 CO:R:CV:G: 082905 JLV; 830857 NY
CATEGORY: Classification
TARIFF NO.: 7305.00.0000; 610.3264
Robert C. Cassidy, Jr.
Wilmer, Cutler & Pickering
2445 M Street, N.W.
Washington, D.C. 20037
RE: Classification of structural pipe for use as insert piles
in an offshore drilling and production platform
Dear Mr. Cassidy:
In a letter of June 22, 1988, as supplemented by a letter
of October 5, 1988, you request on behalf of your client,
Marathon Oil Company (Marathon), a ruling on the tariff
classification under the Tariff Schedules of the United States
(TSUS) and the Harmonized Tariff Schedule of the United States
(HTS) of certain tubular products from Japan. Marathon
proposes to use these products to repair a damaged leg on an
offshore gas and oil drilling and production platform in
Alaska.
FACTS:
The tubular products, described by you as "insert piles,"
consist of 154 sixty-foot sections; each section measures 26
inches in outside diameter; 41 sections have a wall thickness
of 0.75 inch, 31 sections have a wall thickness of 1.0 inch,
and 82 sections have a wall thickness of 1.5 inches. The wall
thickness determines the location of a section in the piles
when assembled into 900-foot units. Weld beads measuring
approximately 1/4-inch in height are located around the
circumference of the outside of the 1.0-inch piles and the
1.5-inch piles at 48-inch intervals; these beads will provide
additional bonding with the cement that will be packed around
the piles. These piles will be inserted into the legs of the
platform as structural supports for the platform and as casing
through which wells will be drilled and other strings of
casing and tubulars will be inserted to recover gas and oil.
- 2 -
Marathon proposes to use these insert piles to act as
load-bearing units which will, in effect, extend the existing
leg module which, because of a well blowout at the base of the
leg, is no longer resting on firm soil. Marathon will install
the insert piles by drilling through the 34-inch diameter
piles already located in the leg module; the drilling will
continue until a firm soil foundation is reached. The piles
will be inserted through the 34-inch existing piles and will
extend approximately 627 feet into the seafloor. These piles
will be cemented into the soil and the existing 34-inch piles.
The total length of the insert piles will be 900 feet.
Additional facts are as follows: the 0.75-inch and the
1.0-inch piles are fabricated according to API Specification
5L for X-52 line pipe, but are not hydrotested and cannot be
used as API line pipe. The 1.5-inch piles are fabricated
according to ASTM A633 Grade C. All of the piles are
fabricated by submerged arc welding which results in a
longitudinal raised bead on the seam. The steel is a high
strength, low temperature steel specified for the application
in the high load (ice; extreme tidal movement) and low
temperatures of the Cook Inlet environment. The minimum
specified yield strength of the pile steel is 50 KSI, and the
Charpy impact values are specified to be 25 foot-pounds at
minus 40 degrees Fahrenheit. Based on the chemical
requirements for the steel set forth in ASTM Spec A633 Grade
C, the insert piles are not made from alloy steel as defined
in headnote 2(h)(ii) of part 2, schedule 6, TSUS, or as
defined in legal note 1(f) of chapter 72, HTS, which is the
definition for alloy steel throughout the HTS.
ISSUE:
Under the TSUS, are the insert piles of a class or kind
of merchandise that is chiefly used as parts of offshore
drilling platforms? Under the HTS, are the insert piles
classified as tubes in heading 7305 under General Rule of
Interpretation (GRI) 1?
LAW AND ANALYSIS:
In a ruling of March 11, 1986 (file 077577), we held that
similar tubular merchandise, called conductor pipe, was
classified as pipe. The structural tubing in that case was
26-inch pipe (outside diameter) in various lengths and coated
or clad with protective materials. The wall thickness of each
length was 1.0 inch. In a ruling of March 30, 1987 (file
079943) we held that unassembled subsections of conductor
- 3 -
piles were classified as parts of offshore platforms. The
imported subsections consisted of the total number of
conductor pilings for the offshore platform. Furthermore,
the 213-foot subsections were constructed of 26-inch pipe
(outside diameter) of several wall thicknesses. The various
subsections had stabbing guides that were fitted and welded
inside the ends to facilitate the joining of the subsections.
For the reasons discussed in this decision, we
distinguish the facts in our ruling of March 30, 1987 (file
079943), from the facts of this case, and conclude that the
ruling is not controlling in this case.
Headnote 1(iv), part 2, schedule 6, excludes "parts of
articles" from classification in that part. Therefore, even
though pipes and tubes are specifically provided for in part 2
of schedule 6, the "specific provision" limitation in General
Interpretative Rule 10(ij) on the classification of parts
under the TSUS is made inapplicable by operation of headnote
1(iv). Standard Commodities Import & Export Corp. v. United
States, ___CIT___ (Slip Op. 88-46, dated April 21, 1988), and
cases therein. However, General Interpretative Rule 10(ij)
also requires that, to be classified in a parts provision, the
merchandise must be chiefly used as a part of the article.
Chief use, as defined in General Interpretative Rule
10(e)(i), is the use that exceeds all other uses combined for
the class or kind to which the imported articles belong.
Actual or intended use is not conclusive as to the chief use
requirement. In this case, the actual use of the articles
(60-foot sections of tubing) may be established, but the 60-
foot sections still belong to the class or kind of structural
tubing that has much broader uses. The court, in United
States v. Carborundum Co., 63 CCPA 98, at 102, C.A.D. 1172
(1976), discussed some of the relevant factors in determining
the class or kind of merchandise. In applying the relevant
criteria to the insert piles, we conclude the following: they
conform to the general physical characteristics and standards
for numerous types of structural tubular products; they are
used as structural supports; they are not, by design or other
feature, precluded from use as structural material in
applications other than as offshore platform piles; they are
recognized by the industry as belonging to the general class
of structural tubulars; and the expectations of the user are
the same as those for the broad class of structural tubulars.
Unlike the subsections fabricated from tubing of multiple wall
thicknesses (file 079943), the sections of tubing in this case
are merely long sections of structural pipe and tube.
- 4 -
The addition of the weld bead on the 1.0 and 1.5-inch
sections does not advance the tubing to the point that they
are "more than pipe or tubes" or that they become a separate
class or kind of structural material.
The HTS, the tariff classification law for the United
States effective January 1, 1989, requires that "classifica-
tion shall be determined according to the terms of the
headings and any relative section or chapter notes and,
provided such headings or notes do not otherwise require,
according to the following provisions..." GRI 1. The
relevant "following" provision is GRI 3(a), as follows:
3. When . . . for any other reason . . . goods are,
prima facie, classifiable under two or more
headings, classification shall be effected as
follows:
(a) The heading which provides the most specific
description shall be preferred to headings
providing a more general description . . . .
The two headings in the HTS are: heading 7305 which provides
for certain welded steel tubes which have internal and
external circular cross sections and an external diameter
which exceeds 406.4 mm; and heading 8431 which provides for
parts suitable for use solely or principally with the
machinery of headings 8425 to 8430 [other boring machinery for
minerals].
Under GRI 1, the heading and legal notes are to be
considered together. In this case, note 1(f), Section XV
[Chapters 72 to 83], excludes machinery of Section XVI (i.e.,
Chapter 84). However, the imported lengths constitute lengths
of pipe or tube similar to any other type of welded pipe or
tube; they are not machinery. The specific length of the
piles, the low temperature metallurgy, and the type of
fabrication have no bearing, in this case, on the description
of the goods as welded pipe in heading 7305.
Heading 8431 provides for parts of machinery, such as the
offshore drilling and production platform [heading 8430;
specifically, subheading 8430.49.4000]. There are no legal
notes that specifically address the inclusion or exclusion of
goods such as the insert piles in chapter 84. Therefore, the
insert piles are prima facie classifiable under two headings.
- 5 -
Under GRI 3(a), the heading with the most specific
description is preferred. In this case, the clear description
of the goods in heading 7305 controls. To the extent that the
insert piles are material lengths of tubes and have not been
made up into specific identifiable articles, they are
accurately described as welded steel (not alloy) tubes with
circular cross sections and external diameter which exceeds
406.4 mm. On the other hand, the term "parts" in heading 8431
covers numerous different types of goods, whether machinery or
made-up steel components. Therefore, the more specific
heading is 7305.
The Explanatory Notes to heading 73.05, Harmonized
Commodity Description and Coding System, Vol. 2, the official
interpretation of the HTS at the international level, state
that the products in this heading include tubes for piling or
structural columns. This describes the product in issue. The
addition of the weld beads to enhance the adhesion of the
cement to the piles does not result in a good that has been
advanced beyond its condition as a tube.
HOLDING:
Under the TSUS Annotated, the insert piles are classified
as welded pipes and tubes of circular cross section, other
than alloy steel, 0.375 inch or more in outside diameter, and,
for statistical purposes, over 16 inches in outside diameter
and having a minimum yield strength of 40,000 p.s.i. or more,
in item 610.3264, rather than as parts of offshore drilling
platforms in item 652.9700.
Under the HTS Annotated, the insert piles are classified
as other longitudinally welded tubes having internal and
external circular cross sections, the external diameter of
which exceeds 406.4 mm, of nonalloy steel, in subheading
7305.31.6000, rather than as parts suitable for use solely or
principally with the machinery of heading 8430 in subheading
8431.43.4000.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc: AD NY Seaport (NY file 830857)
1cc: RC, Pacific Region
1cc: Director, Trade Ops
1cc: Director, ORR
1cc: AC, CO
1cc: John Durant
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