Receipt of Domestic Interested Party Petition Concerning Tariff Classification of Glass Optical Preforms

AGENCY:

Customs and Border Protection, Department of Homeland Security.

ACTION:

Notice of receipt of domestic interested party petition; solicitation of comments.

SUMMARY:

The Bureau of Customs and Border Protection (CBP) has received a petition submitted on behalf of a domestic interested party requesting the reclassification under the Harmonized Tariff Schedule of the United States (HTSUS) of glass optical preforms. CBP's current position is that glass optical preforms are classifiable duty-free in subheading 7002.20.1000, HTSUS, as glass rods of fused quartz or other fused silica, unworked. Petitioner maintains that this classification is incorrect because the optical fiber preforms consist of a glass core rod that has been “worked” by the addition of a layer of cladding glass to the core rod. Petitioner asserts that subheading 7020.00.6000, HTSUS, other articles of glass, other, represents the correct classification. The 2007 rate of duty under this provision is 5 percent ad valorem.

DATES:

Comments must be received on or before May 29, 2007.

ADDRESSES:

You may submit comments, identified by docket number, by one of the following methods:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments via docket number USCBP-2007-0030.
• Mail: Trade and Commercial Regulations Branch, Regulations and Rulings, Bureau of Customs and Border Protection, 1300 Pennsylvania Avenue, NW., (Mint Annex), Washington, DC 20229.

Instructions: All submissions received must include the agency name and docket number for this notice of domestic interested party petition concerning the tariff classification of glass optical preforms. All comments received will be posted without change to http://www.regulations.gov , including any personal information provided.

Docket: For access to the docket to read background documents or comments received go to http://www.regulations.gov. Submitted comments may also be inspected during regular business days between the hours of 9 a.m. and 4:30 p.m. at the Bureau of Customs and Border Protection, Regulations and Rulings, Trade and Commercial Regulations Branch, 799 9th Street, NW., 5th Floor, Washington, DC. Arrangements to inspect submitted comments should be made in advance by calling Joseph Clark, Trade and Commercial Regulations Branch, at (202) 572-8768.

FOR FURTHER INFORMATION CONTACT:

Emily M. Simon, Tariff Classification and Marking Branch, Regulations and Rulings, Office of International Trade at (202) 572-8867.

SUPPLEMENTARY INFORMATION:

Background

A petition has been filed under section 516, Tariff Act of 1930, as amended (19 U.S.C. 1516), on behalf of Corning Incorporated, Corning, New York, requesting that Customs and Border Protection (CBP) reclassify imported optical glass preforms. In accordance with HQ 967058 and HQ 967059, both dated April 21, 2006, CBP classifies this merchandise duty-free in subheading 7002. 20.1000, Harmonized Tariff Schedule of the United States (HTSUS), as glass rods of fused quartz or other fused silica, unworked. Petitioner maintains that this classification is incorrect because the optical fiber preforms consist of a glass core rod that has been “worked” by the addition of a layer of cladding glass to the core rod. Petitioner asserts that subheading 7020.00.6000, HTSUS, other articles of glass, other, represents the correct classification. The 2007 rate of duty under this provision is 5 percent ad valorem.

Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be according to the terms of the headings 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 2 through 6 may then be applied in order.

Optical glass preforms are produced by a two-step process. In the first step, the core layer of the preform is drawn through an annealing furnace, fusing it into a rod by a method called vapor axial deposition. In the second step, the cladding layer of the preform is added by fusing a layer of silica dioxide powder to the outside of the core rod.

Petitioner maintains that CBP's position that core rods are identifiable merely as an intermediate stage in a somewhat continuous process of producing preforms is erroneous. Petitioner contends that core rods exist as a separate and distinct commercial article, are recognized throughout the industry as “rods,” and are referred to as such. Petitioner concludes that the addition of a layer of cladding glass to a core rod renders the rod “worked,” and results in classification in heading 7020, HTSUS, as other articles of glass.

At GRI 1, the classification of optical glass preforms in heading 7002, HTSUS, results from a finding that they are unworked. CBP has uniformly considered the process of “working” glass to have been performed on an extant article of glass, rather than during the process of creating or manufacturing that article. See HQ 960274, dated October 9, 1997. Therefore, it is CBP's position that the “working” of glass articles contemplates a mechanical or physical alteration of the glass after the glass articles are created. Consequently, the addition to a glass core rod of a layer of cladding glass to complete a glass preform cannot at the same time be considered a “working” of that preform.

As an alternative claim, Petitioner asserts that the glass optical preforms, which it now refers to as optical fiber preforms, have a single and recognizable predetermined use as optical fibers. As such, they qualify as incomplete or unfinished optical fibers under GRI 2(a), HTSUS, having the essential character of complete or finished optical fibers classifiable in subheading 9001.10.0030, HTSUS. Optical fibers and other articles of Chapter 90 are excluded from Chapter 70, pursuant to Chapter 70, Note 1(d), HTSUS. The 2007 rate of duty under this provision is 6.7 percent ad valorem.

Petitioner maintains the preforms possess all of the critical optical properties of the fiber, citing HQ 560660 dated April 9, 1999. HQ 560660 involved an analysis of “character” for purposes of substantial transformation in a marking or origin context. CBP found in that ruling that there was no recognizable change in character based on the drawing of the preform into fiber. Petitioner maintains that finding applies equally in a GRI 2(a) context. HQ 560660 cited HQ 960948 dated September 11, 1998, with respect to whether a glass preform was properly classifiable under subheading 9001.10.00, HTSUS, as incomplete or unfinished optical fiber, on the basis of GRI 2(a), HTSUS. Under GRI 2(a), an incomplete or unfinished article will be classified as a complete or finished article provided it has the “essential character” of the complete or finished article. HQ 960948 cited court cases, which looked to the function or use of the article in determining essential character for classification purposes. The ruling stated that the preform is a magnified version of the fiber to be drawn from it and, accordingly, both have the same critical fiber optic attributes. However, CBP noted that the preform does not have the essential physical characteristics (i.e., thinness and flexibility) necessary for practical use as optical fiber. It was further noted that, pursuant to a Harmonized Commodity Description and Coding System Explanatory Note (EN) for GRI 2(a) (i.e., EN GRI Rule 2(a)(II)), the preforms may not be classified as incomplete or unfinished optical fiber (as “blanks”) because they did not have “the approximate shape or outline” of the finished article. Thus, CBP concluded that the glass preform did not have the essential character of a complete or finished optical fiber, and was not an incomplete or unfinished optical fiber classifiable in subheading 9001.10.00, HTSUS.

Comments

Pursuant to section 175.21(a), CBP regulations (19 CFR 175.21(a)), before making a determination on this matter, CBP invites written comments on the petition from interested parties.

The domestic interested party petition concerning the tariff classification of optical glass preforms, as well as all comments received in response to this notice, will be available for public inspection in accordance with the Freedom of Information Act (5 U.S.C. 552, and Section 103.11(b), CBP regulations (19 CFR 103.11(b)), between the hours of 9 a.m. and 4:30 p.m. on regular business days at the Bureau of Customs and Border Protection, Office of Regulations and Rulings, Trade and Commercial Regulations Branch, 799 9th Street, NW., 5th Floor, Washington, DC. Arrangements to inspect submitted comments should be made in advance by calling Joseph Clark at (202) 572-8768.

Authority

This notice is published in accordance with section 175.21(a), CBP Regulations (19 CFR 175.21(a)) and 19 U.S.C. 1516.