Reconsideration of NY M82160; Tariff Classification of steel sealing plugs

HQ H017893 June 23, 2015 CLA-2 OT:RR:CTF:TCM H017893 HvB CATEGORY: Classification TARIFF NO.: 7326.90.85 Sermin Womack UPS Trade Management Service, Inc. 12380 Morris Road Alpharetta, GA 30005 RE: Reconsideration of NY M82160; Tariff Classification of steel sealing plugs Dear Mr. Womack: This letter is in response to your request of September 5, 2007, for reconsideration of New York Ruling Letter (NY) M82160, dated April 28, 2006, issued to Sherex Industries, Ltd. (“Sherex”), as it pertains to the tariff classification of “KOENIG Expander Plugs” and “SAE Port Plugs” under the Harmonized Tariff Schedule of the United States (HTSUS). In that ruling, U.S. Customs and Border Protection ("CBP") classified the subject plugs in heading 7326, HTSUS, which provides for: “Other articles or iron or steel.” In your request for reconsideration, you assert that the instant plugs are classified in heading 8481, HTSUS, which provides for “Tapscockles, valves and similar appliances, for pipes, boiler shells, tanks, vats or the like, including pressure-reducing valves and thermostatically controlled valves; parts thereof”. Your request included samples of the Koenig Expander Plug and sample of an article not at issue. Per your request, both samples will be returned to you. We affirm NY M82160 because the subject steel plugs are not classifiable as parts of valves as they may be used in a variety of applications. In your request for reconsideration, you argue that the subject sealing steel plugs are classified as a part of heading 8481, HTSUS, which provides for “[t]aps, cockles, valves and similar appliances, for pipes, boiler shells, tanks, vats or the like, including pressure-reducing valves and thermostatically controlled valves; parts thereof.” You submit that the instant steel sealing plugs are principally used with fluid power valves. Heading 8481 is found within Section XVI, HTSUS. Note 1(g) to Section XVI provides that “parts of general use” are excluded from Section XVI. Section XV, which includes heading 7326, excludes “articles of Section XVI.” Accordingly, we must determine whether the instant steel sealing plugs are classifiable in Section XV as “parts of general use” before we may we may address whether the instant articles are classifiable in Chapter 84, HTSUS, as a part of a valve in heading 8481. In relevant part, Section XV, Note 2, defines “parts of general use” to mean those articles classifiable in heading 7307, 7312, 7317, 7318 and similar articles of base metals.” The subject plugs are made from steel, which is a base metal. Thus, reading these Notes together, if we determine that the steel sealing plugs are articles similar to fasteners of heading 7318, HTSUS, the steel plug cannot be classified as a "part" under heading 8481, HTSUS. Heading 7318, HTSUS, covers a group of articles which is widely known in commerce as “fasteners.” In Rocknel Fasteners v. the United States, the Court of International Trade set for the common and commercial meaning of bolts and skews: A bolt as "an externally threaded fastener designed for insertion through holes in assembled parts, and is normally intended to be tightened or released by torqueing a nut. [A] screw [is defined] as "an externally threaded fastener capable of being inserted into holes in assembled parts, of mating with a preformed internal thread or forming its own thread, and of being tightened or released by torqueing the head." See Rocknel Fastener v. United States, 24 C.I.T. 900 (Ct. Int'l Trade 2000). The Koenig Expander Plug consists of a self-contained ball in a cup shape sleeve while the SAE Series Port Plug resembles a nut or screw and is “ideal for sealing threaded holes”. The instant articles are adaptable to sealing holes in wide range of applications, similar to articles to which we have classified as “parts of general use” in that the instant plugs perform like fasteners of heading 7318, HTSUS. The articles under consideration are used to mechanically seal holes to prevent leaks “in various hydraulic and pneumatic components such as controls, valves, regulators, cylinders, motors, presses, and pumps” per the website of a distributor of the instant product. Thus, the subject merchandise is not designed for a particular article. It thus meets the definition of a "part of general use" as described by General Note 2(a) to Section XV, HTSUS. According to General Explanatory Note (C), Section XV, HTSUS: [P]arts of general use (as defined in Note 2 to this section) presented separately are not considered as parts of articles, but are classified in the headings of this Section appropriate to them. This would apply, for example, in the case of bolts specialized for central heating radiators or springs specialized for motor cars. The bolts would be classified in heading 73.18 (as bolts) and not in heading 73.22 (as parts of central heating radiators). The springs would be classified in heading 73.20 (as springs) and not in heading 87.08 (as parts of motor vehicles). Reading the above General EN together with General Note 1(g) to Section XVI, HTSUS, which states that Section XVI does not cover "parts of general use, as defined in Note 2 to Section XV, of base metal ...," we find that the steel plug is excluded from classification under heading 8481, HTSUS, which covers parts of valves. CBP has consistently classified similar goods in heading 7326, HTSUS. In Headquarters Ruling Letter (HQ) 967490, dated November 14, 2005, we classified a “back ferrule” which was designed to form tight seal in pipe fittings in subheading 7326.90.85, HTSUS. In addition, in NY N232294, dated September 21, 2012, we classified a steel sealing plugs used to prevent the leakage of hydraulic fluid from the steering gear of an automobile. The subject plugs were installed directly into the bores of the steering gear assembly housing. In NY J82246, dated April 9, 2003, we classified similar sealing plugs in subheading 7326.90, HTSUS. See also N259863, dated December 29, 2014. In support of your request for classification in heading 8481, HTSUS, you cite to several rulings. These rulings are distinguishable. In NY PD F89355, dated August 2, 2000, the Port of Fort Worth, Texas classified steel “valve balls” in subheading 8481.90, HTSUS, as a part of a hydraulic valve. This ruling does not present enough information to show how the instant steel plugs are substantially similar. In NY E89915, dated December 1, 1999, we classified manifold bodies for use with hydraulic pumps in motors in subheading 8481.90, HTSUS. The instant plugs are used to form seals in valves and other components, whereas the hydraulic bodies in the aforementioned ruling are used to control the flow of hydraulic fluid to the motor, and thus is distinguishable. In NY C84344, dated March 4, 1998, we classified valve housings, which allow the connection of multiple control valves within a hydraulic system. The instant plugs are dissimilar from these valve housings, which we noted “regulate the direction, pressure and rate of flow of hydraulic fluid to the machines hydraulic actuator.” NY 817266, dated January 11, 1996, is also distinguishable since the instant products bear no resemblance to the joystick and pedal actuators which we classified in subheading 8481.90. Finally, you also cite to NY 882995, dated March 22, 1993, in support of your contention that heading 7326, HTSUS, is not the appropriate heading. In that ruling, we classified steel connector assemblies used in the hydraulic system of forklift trucks in heading 8431, HTSUS. The articles under consideration in that ruling were described as curved and L-shaped tubes with end flanges. We do not agree that the analysis applies, as we are not presented with an assembly of different materials that has a specific use. Heading 7326, HTSUS, provides for “Other articles of iron or steel”. The ENs to heading 7326, state, in relevant part, that this heading covers all iron or steel articles obtained by forging or punching, by cutting or stamping or by other processes such folding, assembling, welding, turning, milling or perforating other than articles included in the preceding headings of this Chapter or covered by Note 1 to Section XV or included in Chapter 82 or 83 or more specifically covered elsewhere in the Nomenclature. The Koenig Expander and SAE Port plugs are articles made of stainless steel. Because the subject merchandise is not covered by the preceding headings of chapter 73, or by Note 1 to Section XV, are excluded from Section XVI, by Note 1(g), or more specifically covered elsewhere in the Nomenclature, we conclude, in accordance with GRI 1, that subject merchandises are properly classifiable under heading 7326, HTSUS, which provides for “Other articles of iron or steel”. Specifically, classification is under subheading 7326.90.85, HTSUS, the provision for "Other articles of iron or steel: Other: Other: Other: Other." HOLDING: By application of GRI 1, the Koenig MB and SAE Expander Plugs are classified in heading 7326, specifically in 7326.90.85, HTSUS, which provides for “Other articles of iron or steel: Other: Other: Other: Other.” The column one, general rate of duty is 2.9 percent ad valorem. Duty rates are provided for convenience only 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/tata/hts/. The merchandise in question may be subject to antidumping duties or countervailing duties. We note that the International Trade Administration is not necessarily bound by a country of origin or classification determination issued by CBP, with regard to the scope of antidumping orders or countervailing duties.  Written decisions regarding the scope of AD/CVD orders are issued by the Import Administration in the Department of Commerce and are separate from tariff classification and origin rulings issued by Customs and Border Protection.  You can contact them at http://www.trade.gov/ia/ (click on “Contact Us”).  For your information, you can view a list of current AD/CVD cases at the United States International Trade Commission website at http://www.usitc.gov (click on “Antidumping and countervailing duty investigations”), and you can search AD/CVD deposit and liquidation messages using ACE, the system of record for AD/CVD messages, or the AD/CVD Search tool at http://addcvd.cbp.gov/index.asp?ac=home.  EFFECT ON OTHER RULINGS NY M82160 is AFFIRMED. Sincerely, Myles B. Harmon, Director Commercial Trade Facilitation Division