HQ 955405

April 8, 1996

CLA-2 RR:TC:FC 955405 ALS

CATEGORY: Classification

TARIFF NO.: 3907.20.0000

Port Director of Customs

U.S. Customs Service

1 East Bay St.

Savannah, GA 31401

RE: Request for Further Review of Protest 1703-93-100152, Dated October
20, 1993, Concerning the classification OTA-480

Dear Port Director:

This ruling is on a protest that was filed against a

decision of July 23, 1993, concerning the classification of the

subject product.

FACTS:

Based on information received from the manufacturer, OTA-480

is a reaction product of glycerol and 2-methyl-1,2 ethandiol to

form glycerol propoxylate and a further reaction of glycerol

propolylate with acrylic acid to form OTA-480, an acrylic

modified polyether polyol. It is a mixture of different chemical

compounds resulting from the reactions of the above processes.

The product contains 19 different products, all of which, are

different combinations of glycerol, propoxy and acrylic monomer

units. The product is used in the manufacturer of inks,

adhesives and coatings. The importer believes that the product

is an ester of acrylic acid classifiable in subheading

2916.12.5000, Harmonized Tariff Schedule of the United States

Annotated (HTSUSA). The product was liquidated in subheading

3906.90.2000, HTSUSA, which provides for acrylic polymers in

primary form.

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ISSUE:

What is the classification of the instant product which is

used in inks, adhesives and coatings?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUSA is governed

by the General Rules Of Interpretation (GRI\'s) taken in order.

GRI 1 provides that the classification is determined first in

accordance with the terms of the headings and any relative

section and chapter notes. If GRI 1 fails to classify the goods

and if the headings and legal notes do not otherwise require, the

remaining GRI\'s are applied, taken in order.

Counsel for the importer suggests that the product is

classifiable in subheading 2916.12.5000, HTSUSA, as a separate

chemically defined compound. It alternatively suggests that the

product should be considered as a miscellaneous chemical mixture

under subheading 3823.90.5000, HTSUSA.

In considering this matter we note that the product is a

rather complex mixture of different monomer combinations

containing a good number of crosslinking sites at the double bond

at the acrylic end of the molecules. We note that Customs had

concluded that this product had the chemical and structural

characteristics of a typical resin prepolymer and that it fell

within the definition of a \"prepolymer\" as stated in Note 3(e) to

Chapter 39, HTSUSA. These products could be cured by various

methods, i.e., heat (thermoset) UV light (OTA-480) or chemical

(catalytic) reaction (epoxy).

Counsel for the importer indicates that OTA 480 is a

chemically defined compound consisting of essentially 7

compounds, all formed simultaneously as co-products in the same

chemical reaction. Counsel notes that only 34 percent of these

compounds is the desirable product and that the product should be

considered as a separately chemically defined compound based

thereon. The remaining 66 percent of the product is stated to be

undesirable byproducts or impurities which have an adverse effect

on the physical properties of the finished polymer and are not

intended for a specific purpose. Counsel also notes that

repeating monomer units, typical of a prepolymer, occur in only

28 percent of the product, a portion which is only 7 percent by

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weight of the final product. Based on the above, counsel

suggests that classification in subheading 2916.12.5000, HTSUSA,

is appropriate. Alternatively, It suggests, without detailed

argument, that the product should be classified in subheading

3823.90.5000, HTSUSA, as a mixture of polyethylene glycols.

After consideration of the information and documentation

submitted by counsel, we note that the essence of the importer\'s

position is that the ingredients which are unwanted because they

do not form the optimal form of the propoxylate for cross linking

are impurities. It is claimed that these impurities are

dysfunctional and not the best form of the propoxylate for the

purposes of cross linking. We, however, note that the stated

\"impurities\" react with the polymer chains during the curing

process and become part of the final cross-linked polymer. They

obviously give the final product a number of properties, whether

good, bad, or not as good as it could be. In other words these

items have a definite influence on the physical properties of the

final product. Therefore, we do not agree that these ingredients

which are actively involved in the chemical and physical aspects

of the OTA 480 can be characterized as \"impurities.\" In this

regard they are dissimilar to \"impurities\" otherwise noted in the

Explanatory Notes to the Harmonized System (EN), e.g., Chapter

25\. The product must be looked at as a whole, including the main

ingredients and six lesser ingredients.

We do not agree with a technical expert for the importer

that the Scientific Sub-Committee (SC) of the World Customs

Organization has given a very broad scope to the term

\"impurities.\" While no definitive allowable percentages of

\"impurities\" exists for separate chemically defined compounds, we

believe that it is clear at both the international level and the

domestic level that such products should only have minor amounts

of impurities. Normally a product that is less than 90 percent

pure would not be classifiable in chapter 29, HTSUSA, since, as

the amount of impurities increase, the influence of their

characteristics on the primary compound also increase.

Impurities above that level are, as in the instant case, more

likely to become a functional part of the mixture. We find it

extremely difficult to agree with the argument that 66 percent of

an expensive separate chemically defined chemical compound is

incidentally present. Particularly, since these \"impurities\"

cross-link into the final plastic and attached to the polymer.

The properties added by these large amounts of \"impurities\" may

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be somewhat less than what is wanted but they have a direct

impact on the properties of the cross-linked plastic.

Accordingly, we believe that the suggested classification in

subheading 2916.12.5000, HTSUSA, is not appropriate.

We understand that the product contains repeating units and

is designed to be transformed into a higher molecular weight

polymer through further polymerization or curing. Thus the

products meets the Chapter 39 definition of a prepolymer. While

the most desirable portion of the product does not, as indicated

by counsel, have repeating units, we find no basis for ignoring

ingredients that form 66 percent of the product. The number of

repeating units is averaged over the entire product and not just

the repeating chain. Thus, as in the instant case the repeating

unit number may be relatively low, i.e., less than 2. This is

consistent with General Note (e) to heading 39.01 to 39.11 of the

EN which provides that prepolymers are products which are

characterized by some repetition of monomer units.

We have concluded that the product is properly classifiable

as a prepolymer. Based thereon, we find it unnecessary to

address a suggested alternate classification of chapter 38,

HTSUSA.

HOLDING:

A product formed by a chemical reaction which produces

glycerol propoxylate and a further reaction with acrylic acid to

form an acrylic modified polyether polyol, is considered a

prepolymer and is classifiable in subheading 3907.20.0000,

HTSUSA, which provides for other polyethers in primary form.

Merchandise so classifiable is subject to a general rate of duty

of 1.8 cents per kilogram and 7.5 percent ad valorem.

Since the rate if duty under the classification indicated

above is more than the liquidated rate, you are instructed to

deny the protest in full.

A copy of this ruling should be attached to the Customs Form

19 and provided to the protestant as part of the notice of action

on the protest.

In accordance with Section 3A(1)(b) of Customs Directive 099

3550-065, dated August 4, 1993, Subject: Revised Protest

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Directive, this decision should be provided by your office to the

protestant no later than 60 days from the date of this letter.

Any reliquidation of the entry in accordance with this decision

must be accomplished prior to the mailing of the decision. Sixty

days from the date of the decision the Office of Regulations and

Rulings will take steps to make the decision available to Customs

personnel via the Customs Rulings Module in ACS and the public

via the Diskette Subscription Service, Freedom of Information Act

and other public access channels.

Sincerely,

John Durant, Director

Tariff Classification

Appeals Division