United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 2005 HQ Rulings > HQ 116494 - HQ 230983 > HQ 230709

Previous Ruling Next Ruling
HQ 230709

December 14, 2004

RR:CR:DR 230709 EM

U.S. Customs and Border Protection
Port Director
1100 Raymond Blvd.
Newark, NJ 07102
ATTN: Susan Masser

RE: Protest/Application for Further Review No. 4601-04-101381; 19 U.S.C. § 520(c)(1); section 520(c) claim; mistake of fact; misclassification under HTSUS

Dear Ms. Masser:

This is in reply to your memorandum dated August 17, 2004, requesting a further review of Protest No. 4601-04-101381. Neville Peterson LLP filed the protest on behalf of the importer, Nisso America, Inc.

The protest concerns the denial of a § 520(c) petition for reliquidation of seven entries of 1,2 liquid polybutadiene rubber (PB-B1000). Customs and Border Protection (CBP) liquidated the entries between February 7, 2003 and July 7, 2003. The protestant objects to CBP’s classification of the goods under subheading 3902.90.0050 of the Harmonized Tariff Schedule of the United States (HTSUS), claiming that it stems from a mistake of fact. Our decision follows.


The protestant made seven entries of PB-B1000 between March 24, 2003 and July 21, 2003. Upon entry, you classified the goods under subheading 3902.90.0500, HTSUS, which provides for “Polymers of propylene or other olefins, in primary forms: Other: Other.” The basis for this classification was NY 818016, dated March 19, 1996. See Customs Protest and Summons Information Report (CF-6445A) dated August 16, 2004. The National Commodity Specialist Division (hereinafter Division) originally issued this tariff classification ruling in response to a request from the protestant in January 1996.

You liquidated the seven entries of PB-B1000 between February 7, 2003 and June 5, 2003. On November 20, 2003, the protestant filed a § 520(c) petition for reliquidation of the goods under subheading 4002.20.00, HTSUS, as “Synthetic rubber and factice derived from oils, in primary form or in plates, sheets, or strip: Butadiene rubber (BR).” In its petition, the protestant alleged that CBP misclassified the PB-B1000, claiming that NY 818016 improperly classified the goods under 3902.90.0050, HTSUS, based on a misinterpretation of laboratory results conducted for synthetic rubber under Note 4(a) of Chapter 40, HTSUS.

Based on the same allegation, the protestant also submitted a separate request for reconsideration of NY 818016 on June 13, 2003. In that case, we reviewed the classification of PB-B1000 and subsequently published notice of the proposed revocation in the Customs Bulletin on February 4, 2004. No comments were received in response to the notice and we subsequently revoked NY 818016 in HR 966558, dated March 19, 2004. That ruling set forth the correct classification of PB-B1000 under subheading 4002.20.00, HTSUS.

Accordingly, we published the “Revocation of Ruling Letter and Revocation of Treatment Relating to Tariff Classification of Liquid 1,2-Polybutadiene Rubber (Nisso PB B-1000)” on March 24, 2004 in the Customs Bulletin. 38 Cust. B. & Dec. 19. In that notice of action, we specified the effective date for the revocation of NY 818016, setting forth subheading 4002.20.00, HTSUS, as the proper classification for PB-B1000 entered or withdrawn from warehouse for consumption on or after May 23, 2004.

You denied the protestant’s § 520(c)(1) petition for reliquidation of its entries of PB-B1000 on May 5, 2004. In the denial, you stated that NY 818016 was “in effect for this product at the time of entry for the entries protested.” The protestant filed a Protest (CF-19) and supplemental Memorandum of Points and Authorities on June 15, 2004, alleging that the misclassification of the subject entries was “correctable pursuant to 19 U.S.C. § 1520(c) because of a mistake of fact.”

Specifically, the protestant claims that CBP’s misclassification of the PB-B1000 has its genesis in NY 818016. The protestant pinpoints the “[misinterpretation of] the test results for the standard set out in HTS Chapter 40, Note 4(a).” Note 4(a) provides, in part, that the expression “synthetic rubber” applies to:

[u]nsaturated synthetic substances which can be irreversibly transformed by vulcanization with sulfur into non-thermoplastic substances, which at a temperature between 18 C and 29 C, will not break on being extended to three times their original length and will return, after being extended to twice their original length, within a period of 5 minutes, to a length not greater than 1- ½ times their original length. (emphasis added)

Thus, for classification under subheading 4002.20.00, HTSUS, laboratory tests must demonstrate that: (1) the PB-B1000 can be extended to three times its original length; and (2) the PB-B1000, after such an extension, will revert back to a length not greater than 1 ½ times its original length within five minutes.

In NY 818016, the Division classified PB-B1000 under subheading 3902.90.0050, HTSUS, based on the Customs Laboratory’s conclusion that “the dumbbells [sic] shaped test specimens [of PB-B1000] submitted do not meet the criteria for ‘synthetic rubber’ as set forth in Note 4(a) to Chapter 40, HTSUSA.” Customs Lab Report No. 2-1996-30180 dated Feb. 26, 1996. Subheading 3902.90.0050, HTSUS, applies to synthetic rubbers when Chapter 4, HTSUS, is precluded, i.e., when Note 4(a) is not satisfied. The Division promulgated NY 818016, a tariff classification ruling, in accordance with these findings. The ruling established that subheading 3902.90.0050, HTSUS, was the appropriate classification for PB-B1000, without detailing the applicable testing methodology for compliance with Note 4(a) or the reasons that the PB-B1000 failed the laboratory tests.

The American Society for Testing and Materials (ASTM) D412-98a test assesses compliance with Note 4(a). For NY 818016, the Customs Laboratory analyzed samples submitted by the protestant in conjunction with its 1996 request for a ruling on the tariff classification of PB-B1000 pursuant to the ASTM D412-98a testing method. We note that the first criterion of Note 4(a), which requires that the sample extend to three times its original length, is measured by the percentage of elongation at break. See HQ 966558 dated March 9, 2004 (summarizing the ASTM D412-98a requirements). So long as that percentage exceeds 200%, the sample satisfies the requirement. Id.

The protestant relies on our decision in HQ 966558 as proof that the Division misinterpreted the ASTM D412-98a lab results for the PB-B1000. In HQ 966558, we revoked NY 818016, which classified the PB-B1000 under subheading 3902.90.0050, HTSUS. HQ 966558 granted protestant’s request for reconsideration of NY 818016, after the Customs Laboratory completed an analysis of certain measurements for PB-B1000’s conformity with Note 4(a). Specifically, the protestant submitted two sets of laboratory test results, one by Dainippon Jushi Kenkyusho, Co., Ltd. of Japan (DJK) and the other by Specialized Technology Resources (STR). Both sets of test results confirmed that PB-B1000 meets the requirements set forth in Note 4(a) to Chapter 4, HTSUS.

In reviewing the request for reconsideration, CBP analyzed the STR test results, arrived at using the ASTM D412-98a tests to measure elongation. We will not revisit HQ 966558; instead, we simply note that the decision vindicated the protestant’s allegation that PB-B1000 should be classified as a synthetic rubber in subheading 4002.20.00, HTSUS. As we concluded in HQ 966558,

[the] Customs Laboratory in New York reviewed the ASTM D412-98a test measurements taken by STR and analyzed the dumbbell samples with a recipe prepared by Nippon Soda Company of Tokyo, Japan. The subject merchandise was tested for compliance with Note 4(a) of Chapter 40, using the ASTM D 412-98a elongation test. Customs Laboratory Report NY-2003-1253, dated July 31, 2003, determined that a sample of the subject goods meets the definition of Note 4(a) to Chapter 40, HTSUS.

Accordingly, we revoked NY 818016 and ruled that the proper classification of PB-B1000 is as a synthetic rubber under subheading 4002.20.00, HTSUS.

The protestant also cites the United States’ prior stipulation that PB-B3000 is properly classified under subheading 4002.20.00, HTSUS, rather than subheading 3902.90.0050, HTSUS. See Nisso America, Inc. v. United States, Stipulated Judgment on Agreed Statement of Facts, Docket No. 01-00628, entered Oct. 23, 2004 (Ct. Int’l Trade). In that case, CBP had liquidated entries of PB-B3000 under subheading 3902.90.0050, HTSUS. The misclassification stemmed from the Customs Laboratory’s misinterpretation of ASTM D412-98a test results for PB-B3000. The evidence in that case clearly suggested that the Customs Laboratory misinterpreted an elongation of more than 200% (and less than 300%), to mean that the sample had not stretched to three times its length. See Customs Worksheet Summary (Lab Report No. 00-30243) dated Sept. 26, 2000.

Furthermore, the protestant notes that, for classification purposes, PB-B1000 is identical to PB-B3000, and thus a stipulation that PB-B3000 is classifiable under subheading 4200.20.00 directly implies the same for PB-B1000. The protestant alleges that CBP also misinterpreted the elongation percentages for the PB-B1000 in the same manner as it had in the case of the PB-B3000.

In light of the aforementioned facts and circumstances, the protestant’s position is that the misclassification of the seven entries of PB-B1000 under subheading 3902.50.00, HTSUS, constitutes a mistake of fact. Accordingly, the protestant seeks reliquidation of the entries under subheading 4200.02.00, HTSUS.


Whether the liquidation of the subject merchandise consistent with a tariff classification ruling based on CBP’s misinterpretation of laboratory test results constitutes a clerical error, mistake of fact, or other inadvertence for which relief may be granted under 19 U.S.C. § 1520(c)?


Initially, we note that the protest was timely filed within 90 days of the denial of the request for reliquidation under 19 U.S.C. § 1520(c)(1). See 19 U.S.C. § 1514(c)(3)(B). The request for reliquidation was denied on May 5, 2004, and the protest was filed on June 15, 2004. Under 19 USC § 1514(a)(7), "decisions of the Customs Service, including the legality of all orders and findings entering into the same, as to . . . the refusal to reliquidate an entry under section 1520(c) . . . shall be final and conclusive upon all persons (including the United States and any officer thereof) unless a protest is filed in accordance with this section. Hence, the refusal to reliquidate an entry under § 1520(c) is subject to protest. Additionally, the criteria for granting a request for further review are set forth in 19 C.F.R. § 174.24 which states, in part, that further review will be accorded to the party filing an application which meets at least one of the criteria enumerated therein. Further review is justified because this protest involves questions of law and fact that have not been ruled upon. See § 174.24(b). Specifically, the issue is whether entries are eligible for reliquidation under § 520(c) when merchandise is misclassified pursuant to a tariff classification ruling in effect at the time of liquidation.

The protestant has requested reliquidation of the seven entries of PB-B1000 by filing a § 520(c) petition. Section 520(c) of the Tariff Act of 1930, as codified at 19 U.S.C. § 1520(c), is an exception to the finality of § 1514. Per 19 U.S.C. § 1520(c):
the Customs Service may, in accordance with regulations prescribed by the Secretary, reliquidate an entry or reconciliation to correct-- (1) a clerical error, mistake of fact, or other inadvertence, whether or not resulting from or contained in electronic transmission, not amounting to an error in the construction of a law, adverse to the importer and manifest from the record or established by documentary evidence, in any entry, liquidation, or other customs transaction, when the error, mistake, or inadvertence is brought to the attention of the Customs Service within one year after the date of liquidation or exaction . . . .

Therefore, CBP may reliquidate the protested entries to correct a clerical error, mistake of fact, or other inadvertence if three requirements are satisfied: (1) the error is adverse to the importer's interest; (2) the error is manifest from the record or established by documentary evidence; and (3) the error is brought to CBP’s attention within one year of the date of liquidation.

We note that the protestant timely filed the § 520(c) petition on November 20, 2003, which was within one year of February 7, 2003, the earliest date of liquidation for the entries covered by the petition. In addition, we agree that the decision to liquidate the entries under subheading 3902.90.0050, HTSUS, is adverse to the importer. Under subheading 4002.20.00, HTSUS, the goods are duty-free. The decision to classify the goods under subheading 3902.90.0050, HTSUS, is clearly adverse to the protestant, as the protestant assumed a tariff burden of a 6.5% ad valorem rate of duty.

At issue, then, is whether the record demonstrates that the misclassification of the PB-B1000 resulted from a clerical error, mistake of fact, or other inadvertence that does not amount to an error in the construction of law. A mistake of fact is “a mistake which takes place when some fact which indeed exists is unknown, or a fact which is thought to exist, in reality does not exist." C.J. Tower & Sons of Buffalo, Inc. v United States, 68 Cust. Ct. 17, 22 (1972) (citations omitted), aff’d by 499 F.2d 1277 (C.C.P.A. 1974) (citations omitted). An “inadvertence” is even broader in scope, encompassing oversights or involuntary accidents, even mistakes resulting from inattention and carelessness. Hambro Automotive Corp. v. United States, 603 F.2d 850, 854 (C.C.P.A. 1979). Additionally, a clerical error is “mistake by a subordinate, who does not have any duty to exercise judgment with regard to classification.” Xerox Corp. v. United States, 219 F. Supp. 2d 1345, 1348 (Ct. Int’l Trade 2002) (citations omitted), enforced by No. 99-02-00086, slip op. 2004-113 (Ct. Int’l Trade Dec. 8, 2004).

In contrast, a mistake in the construction of law exists when “the facts are known, but their legal consequences are not known or believed to be different than they really are.” Hambro, 603 F.2d at 855. Ordinarily, mistakes in the classification of merchandise under the HTSUS are considered mistakes in the construction of a law and not correctable under § 1520(c)(1). See e.g. Cavazos v. United States, 9 Ct. Int’l Trade 628, 630 (1985); Mattel, Inc. v. United States, 72 Cust. Ct. 257, 261-62 (1974). An error in classification may be correctable under 19 U.S.C. § 1520(c)(1) when that error consists of a misunderstanding of the nature of the goods in question by either the importer, its agents, or CBP. See e.g. Zaki Corp. v. United States, 21 Ct. Int’l Trade 263, 274-75 (1997). Additionally, the Court of International Trade (CIT) has drawn a distinction between decisional and ignorant mistakes concerning the nature of merchandise:

There is the decisional mistake in which a party may make the wrong choice between two known, alternative set[s] of facts. There is also the ignorant mistake in which a party is unaware of the existence of the correct alternative state of facts. The decisional mistake must be challenged under Section 514. The ignorant mistake must be remedied under Section 520.

Universal Coop., Inc. v. United States, 13 Ct. Int’l Trade 516, 518 (1989). This distinction emphasizes the purpose of § 1520(c), which is to provide limited relief where an unnoticed or unintentional error has been committed. Computime, Inc. v. United States, 9 Ct. Int’l Trade 553, 556 (1985) (citing C.J. Tower & Sons, 68 Cust. Ct. at 21).

In the instant case, the protestant alleges that a mistake of fact in the classification of the subject entries of PB-B1000: “Customs’ failure to correctly read the laboratory results was a mistake of fact which resulted in the misclassification of the subject entries.” In light of the judicially proscribed limitations on § 520(c) petitions, this alleged mistake of fact for the subject entries must (1) stem from CBP’s misunderstanding of the nature of the goods; and (2) result from CBP’s ignorance of the correct state of the facts.

First, with regard to the nature of the goods, we acknowledge that CBP misclassified the PB-B1000 when it issued NY 818016 in 1996. Its subsequent revocation by HQ 966558 leaves no doubt as to the proper classification of the PB-B1000 under subheading 4002.20.00, HTSUS. Moreover, CBP’s stipulation to the proper classification for PB-B3000 in a separate case is compelling evidence given that the protestant has demonstrated that CBP misinterpreted the meaning of 200% elongation under the ASTM D412-98a test for a substance identical to PB-B1000 for classification purposes. The documentary evidence in this case is sufficient to demonstrate that CBP’s misinterpretation of the laboratory test results is responsible for the misclassification of the PB-B1000 in NY 818016.

Second, and of greater significance, the misclassification of the subject entries did not result from CBP’s ignorance of the correct state of the facts. Rather, the port applied a tariff classification ruling in the liquidation of the subject entries of PB-B1000. While a misinterpretation of the laboratory results was enshrined in the tariff classification ruling, that misinterpretation of the laboratory tests is not the focal point in our analysis of the alleged mistake of fact. This investigation properly focuses on whether CBP made a mistake of fact in its classification of the PB-B1000 at the time of entry. Xerox, 219 F. Supp. 2d at 1351 (finding that plaintiff “must establish a viable ‘mistake of fact’ claim based on the initial mistake of classification at entry”).

The initial mistake of classification at entry is that the protestant entered the goods under the HTSUS heading consistent with the 1996 tariff classification ruling, NY 818016. There was no mistake of fact by the port in its liquidation of the goods per NY 818016, even though it later became apparent that the ruling misclassified the PB-B1000 under subheading 3902.90.0050, HTSUS. The port was legally bound to enforce the tariff classification ruling in effect at the time of liquidation. See 19 C.F.R. § 177.9. See also Fujitsu Compound Semiconductor, Inc. v. United States, 363 F.3d 1230 (Fed. Cir. 2004), aff’g 246 F. Supp. 2d 1334 (Ct. Int’l Trade 2003). The port’s decision to enforce a tariff classification ruling is a legal decision. Cf. HQ 226274 dated Aug. 7, 1996 (citing HQ 75-0026 dated Jan. 24, 1975, which ruled that an error in the construction of law exists when an import specialist takes note of a ruling but decides it is inapplicable to the imported merchandise). Accordingly, a misclassification enshrined in a binding tariff classification ruling is not subject to relief as a mistake of fact under § 1520(c)(1). A binding ruling may not be challenged through a § 520(c) petition, which is intended as a limited remedy for mere oversights in the entry process.

Even if NY 818016 were not applicable to the subject entries, we note that CBP’s misinterpretation of laboratory results is not a mistake of fact under § 1520(c). The misinterpretation of laboratory results constitutes a decisional error that is beyond the scope of § 520(c). In Universal Coop., the CIT indicated in no uncertain terms that a misinterpretation of laboratory results by CBP is a decisional mistake that cannot be remedied under § 520(c). 13 Ct. Int’l Trade at 518. In that case, the imported polypropylene baler twine was eligible for duty-free treatment under the HTSUS if it measured wider than an inch. Id. at 517. Upon entry, CBP’s laboratory analysis of a sample indicated that the goods measured less than an inch in width and thus CBP liquidated the goods under a dutiable tariff subheading. Id. Consequently, the importer filed a § 520(c) petition, claiming that CBP made a mistake of fact because the width of the goods did, in fact, exceed one inch. Id.

The CIT held that when CBP relies on laboratory results, rightly or wrongly, in making a classification decision, that is
a situation for which the conventional protest method of 19 U.S.C. § 1514 was manifestly designed, i.e., an importer with a fully informed position regarding its merchandise, confronting an informed, but adverse decision by the government.

Id. at 518. The CIT clarified that while CBP may have been “mistaken as to the correct state of the facts . . . it [the misclassification] was not from ignorance of a possible alternative state of facts.” Id. Likewise, in this case, CBP mistakenly interpreted the ASTM D412-98a test results to mean that PB-B1000 did not stretch to three times its length prior to breaking. Furthermore, the decisional nature of the misclassification of the PB-B1000 is much more apparent than was the case in Universal Coop. In that case, questions surrounding the classification of the propylene baler twine arose at the time of entry and a lab test was conducted to resolve the ambiguity. Here, the lab test analysis was part and parcel of CBP’s decision-making process in the issuance of a tariff classification ruling for PB-B1000. Under Part 177.2, the protestant was required to submit documentation in support of its tariff classification to the New York office for analysis. Given the informed position of the importer in seeking a tariff classification ruling and the informed response issued by CBP in NY 818016, a subsequent objection to the classification of entries of PB-B1000 is one for which the protest process was manifestly designed. See id.

The instant case is also distinguishable from past decisions to grant § 520(c) petitions for reliquidation of misclassified goods. In G & R Produce Co. v. United States, 381 F.3d 1328 (Fed. Cir. 2004), the court found a mistake of fact where the CBP import specialist stated that the Persian limes would have been liquidated under the correct subheading but for the import specialist’s ignorance that more than one subheading covering limes even existed. In Zaki, the CIT determined that the importer’s broker made a mistake of fact upon entering the radio broadcast receivers under an incorrect HTSUS subheading, due to broker’s being unaware of “the exact physical properties of the merchandise.” 21 Ct. Int’l Trade at 274. We found a mistake of fact in HQ 228591, dated January 9, 2001, when the private customs broker failed to realize that the goods could be sold as sets, rather than as individual men’s shirts and shorts, resulting in the doubling of the value of merchandise. The decisions in G&R Produce, Zaki, and HQ 228591 underscore the principle that 520(c) is available as a remedy only when the mistake is one of ignorance. In each of these cases, the party that classified the goods was ignorant of the existence of a significant fact. In the instant case, the record is clear that CBP’s decision to liquidate the subject entries of PB-B1000 was anything but an ignorant one—the classification was based on a binding tariff classification ruling which was decided upon in response to the protestant’s request and grounded in the Customs Laboratory’s analysis of test results.

We note that our decision on this application for further review of the § 520(c) petition rests firmly on the fact that the misclassification of the PB-B1000 at the time of entry resulted from a tariff classification ruling still in effect at the time of liquidation. The subsequent revocation of the tariff classification ruling, which occurred more than eight months after the liquidation of the PB-B1000, has no bearing on the outcome of this case. See e.g. HQ 226722 dated Nov. 12, 1996. Counsel for the protestant did not submit a request for reconsideration of NY 818016 until June 13, 2002 and the fact that we did not revoke the NY 818016 until March 9, 2004 does not create an additional argument germane to this 520(c) petition. Finally, the absence of a viable basis for a § 520(c) petition in this case does not mean that the protestant was without redress for the duties assessed when its goods were misclassified and liquidated pursuant to a tariff classification ruling.

The burden was on the protestant, here, to protest the liquidation under 19 U.S.C. § 1514. We note that § 1520(c) “does not afford a second bite at the apple” and its provisions are not intended to “excuse the failure to satisfy the requirements of § 1514.” ITT Corp. v. United States, 24 F.3d 1384, 1387 n.4 (Fed. Cir. 1994). The protestant may not reach back, under the guise of a § 520(c) petition and invalidate a legal decision by CBP of which the protestant has been on notice since 1996. An error that resulted from the application of a binding tariff classification ruling to the entries is not subject to relief as a mistake of fact under § 1520(c)(1). A § 520(c) petition provides limited relief to the finality of CBP’s decisions under § 1514; it is not a statutory grant of authority to implicitly nullify a legally binding tariff classification ruling. See Xerox, 219 F. Supp. 2d at 1350-51 (finding that the plaintiff is precluded from claiming a mistake of fact as a basis for a § 520(c) petition in order to bootstrap another mistake eligible for reliquidation solely under § 1514).


The protest should be DENIED. The protestant is not entitled to reliquidation of the subject merchandise under 19 U.S.C. § 1520. In the absence of a protest per 19 U.S.C. § 1514, the goods were properly classified in accordance with NY 818016, which was in effect at the time of liquidation.

In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to CBP personnel and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.


Myles B. Harmon, Director
Commercial Rulings Division

Previous Ruling Next Ruling

See also: