Plywood, Veneered Panels, and Similar Laminated Wood New Orleans, LA March 16, 2018 Laurel Duvall, National Import Specialist. Not for duplication
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1 Plywood, Veneered Panels, and Similar Laminated Wood New Orleans, LA March 16, 2018 Laurel Duvall, National Import Specialist 1
2 Disclaimer The material in this presentation is for general information purposes and is intended to provide guidance and information to the trade community to promote the understanding of, and compliance with, importing laws and regulations. Legislative and administrative changes are always under consideration and can occur at any time. Therefore, the information contained herein should not be interpreted to indicate a certain result will occur in a particular situation. 19 C.F.R (b) provides that The application of a ruling letter by a CBP field office to the transaction to which it is purported to relate is subject to the verification of the facts incorporated in the ruling letter, a comparison of the transactions described therein to the actual transaction, and the satisfaction of any conditions on which the ruling was based. Recognizing that many complicated factors may be involved in customs issues, an importer may wish to obtain a ruling under CBP Regulations, 19 C.F.R. Part 177, or obtain guidance from private-sector experts who specialize in customs matters, such as a licensed Customs Broker, attorney or consultant. Reliance solely on the general information in this webinar may not be considered reasonable care. 2
3 Contact information Laurel Duvall, NIS 130 (646) World Trade Center, Suite New York, NY laurel.duvall@cbp.dhs.gov 3
4 What does an NIS do? A National Import Specialist specializes in imports of specific commodities, and amongst other duties: Writes binding rulings on product classification, special trade programs, and country of origin/marking. Reviews AD/CVD scopes for administrability and conformance with the Harmonized Tariff Schedule of the U.S. (HTSUS) Contributes on international and national levels to the creation and implementation of HTSUS provisions Are subject matter experts in court proceedings and other agency matters. 4
5 Binding Rulings I swear they aren t a bad thing! 5
6 Binding Ruling Requests What are binding rulings? Rulings are written decisions issued by CBP that are legally binding on both the agency and the importer. 6
7 Binding Ruling Benefits Binding rulings allow for predictable trade. Knowing the duty rate allows for financial planning. Guarantees Customs treatment of the product. Very transparent - You can access all rulings and research them. If you disagree, you can challenge the ruling and rulings will not be changed or revoked without notice. They re free! They re easy to request 7
8 Binding Rulings Rulings can address many topics, including: Classification Valuation Special Trade Programs Marking/Country of Origin Carriers, Foreign Trade Zones, Bonded Warehouses Entry Processes Intellectual Property Rights Etc. 8
9 Binding Rulings Check out Customs Informed Compliance Publication to learn more: cbp_rulings_prog_3.pdf 9
10 Binding Rulings How can you search and read rulings? rulings.cbp.gov CROSS is a database that currently contains nearly 198,000 rulings. Sometimes you need to get creative in your searches to find ruling guidance, but with so many rulings, there s a good chance there s already a ruling on the product you re querying, or even a similar product. 10
11 Binding Rulings Who issues rulings? National Commodity Specialist Division in NYC (NISs) Regulations and Rulings, CBP Headquarters, Washington DC Do you know the difference between a New York ruling and a Headquarters ruling? 11
12 Binding Rulings New York Rulings: These are written rulings issued on prospective importations. Governed by 19 CFR The NCSD cannot issue rulings once the goods are imported or the Port or CEE has taken action on the entry. If the importer disagrees with the Port s or CEE s action, the NCSD is precluded from issuing a ruling. You may pursue the matter by the Internal Advice procedure, or you may file a protest with an Application for Further Review. 12
13 Binding Rulings New York Rulings: New York is the first line of classification ruling issuance. Importers and other interested parties can request rulings directly from the NCSD The NCSD is made up of commodity experts The NCSD issues rulings covering: Classification Country of Origin Marking Special Trade Programs/Free Trade Agreements, e.g. NAFTA, CAFTA, etc. 13
14 Binding Rulings HQ Rulings Are written by attorneys Include more detailed legal analysis than NY rulings Importers and other parties do not generally request prospective classification rulings from HQ 14
15 Binding Rulings HQ rulings cover: Internal Advice Requests 19 CFR Protests with Application for Further Review - 19 CFR Reconsiderations of NY Rulings 19 CFR Processes and subjects not covered by NY rulings, such as carriers, IPR, restricted merchandise, bonded warehouses, etc. Sometimes precedential rulings forwarded by the NCSD 15
16 Binding Rulings CBP does NOT issue binding rulings on matters of AD/CVD Note that neither HQ nor the NCSD issues rulings regarding anti-dumping or countervailing duty cases. Jurisdiction for AD/CVD lies with the Dept. of Commerce. 16
17 Binding Rulings If you have an NY ruling and an HQ ruling on a particular product that conflict, which ruling takes precedence? The HQ Ruling 17
18 Submitting Binding Ruling Requests Requests must include: Full and complete description of the item Complete statement of all relevant facts Quantity and value breakdowns of materials Identify the port(s) at which the goods will be entered Currently or previously considered by CBP or Courts? Limited to five items of the same class or kind 18
19 Electronic Binding Ruling Requests Because many complicated factors can be involved in Customs issues, an importer may wish to obtain a binding ruling, or may wish to obtain advice from an expert who specializes in Customs matters, for example, a licensed Customs Broker, attorney or consultant. Rulings can be requested in writing to: Director, NCSD Regulations and Rulings Customs and Border Protection 201 Varick St., Suite 501 New York, NY Rulings can be requested electronically at: 19
20 Advice Please feel free to use me as a resource What we consider in classifying a product If you don t understand a ruling or the difference between rulings If you want to understand what tariff language means But PLEASE don t ask me to classify your goods informally. NISs issue binding classifications. Centers issue advice. 20
21 Dedicated to wood! 21
22 Heading 4412, HTSUS This heading covers panels of a laminated, multilayer construction. Laminated, in tariff terms, means bonded together, usually with glue and under pressure. What do plywood, veneered panels and similar laminated wood mean in the HTSUS? 22
23 Heading 4412 Flooring of a plywood construction AKA Engineered flooring 23
24 Plywood Plywood is defined in the Explanatory Notes to the Harmonized System (ENs) as three or more sheets of wood glued and pressed one on the other and generally disposed so that the grains of successive layers are at an angle 24
25 Plywood 25
26 Plywood In tariff terms, plywood is a construction, not a thing. Therefore, many things can be classified as plywood. 4x8 plywood sheet Engineered wood flooring Blockboard Bamboo plywood 26
27 Veneered Panels Veneered Panels are defined as panels consisting of a thin veneer of wood affixed to a base, usually of inferior wood (can be other materials if veneer gives panel essential character), by gluing under pressure 27
28 Veneered Panels Why is veneered MDF not plywood? Because fiberboard does not have a grain 28
29 Similar Laminated Wood SIMILAR LAMINATED WOOD is defined as: 1) Blockboard, laminboard and battenboard - the core is thick and composed of blocks, laths or battens of wood glued together and surfaced with outer plies 2) Panels in which the wooden core is replaced by other materials such as a layer or layers of particle board, fibreboard, wood waste glued together, asbestos or cork Similar laminated wood can also be plywood. The subheadings allow for both. 29
30 Similar Laminated Wood 30
31 Heading 4412 Classification in 4412 is determined by the FACE PLY Meranti plywood Cherry Veneered Particleboard Oak blockboard 31
32 Heading 4412 PLYWOOD What is surface covered? One or more exterior surfaces of a product have been treated with creosote or other wood preservatives, or with fillers, sealers, waxes, oils, stains, varnishes, paints or enamels, or have been overlaid with paper, fabric, plastics, base metal, or other material With grain visible With grain obscured 32
33 Fiberboard and Plywood MDF overlaid plywood MDF is not a face ply, it is a surface covering that obscures the grain MDF-faced lumber Combi-core plywood Not plywood because MDF has no grain. Classified outside of 4412 MDF crossbands do not impact classification. They do not negate the properties of plywood. 31
34 You need a break So, here s a breakdancing log. 34
35 Classifying in 4412 To determine classification of panels in heading 4412, you MUST answer the following questions: Does the panel consist of layers? How many layers? What are the layers (veneer, lumber, MDF, etc.)? What is the thickness of each layer in mm? What are the species of wood of the front and back layers (are the species coniferous, non-coniferous, or tropical (ENs to 4421))? 35
36 Classifying in 4412 To determine classification of panels in heading 4412, you MUST answer the following questions: Does the construction of the panel meet the definition of plywood, a veneered panel, or similar laminated wood? Does the panel have a surface coating or covering? Is that coating clear, transparent, or opaque? 36
37 Classifying in 4412 To determine classification of panels in heading 4412, you MUST answer the following questions: Which outer ply is the face, and which is the back? Does one side have a higher grade? Are the grades of both outer plies equal? Is there a functional surface coating on one side? What is the function of the panel? Is it flooring, or is it a material that can be used in multiple ways? 37
38 Classifying in 4412 To determine classification of panels in heading 4412, you MUST answer the following questions: Is the material worked? Is it continuously shaped (like tongue & groove)? Is it cut to a shape other than rectangular? Is it curved (as in wavy)? Is it drilled, perforated, or notched? Does it have edge-banding? Is it dedicated for a specific use? 38
39 Classification in 4412 Must compare classifications at equal heading and subheading levels. Product must meet description before proceeding to the next subheading. The HTSUS works like an outline: Animals Cats With spots 3.2% Dogs With spots...free Where do you classify cats with spots? 39
40 Classification in 4412 Unfinished Maple Plywood 40
41 Plywood 41
42 AD/CVD A /C Hardwood Plywood Hardwood and decorative plywood, and certain veneered panels Panels with two or more outer layers or plies of wood veneers and a core. AT LEAST 3 LAYERS At least one of the outer layers is made up of non-coniferous wood or bamboo. The panels are included in the scope regardless of surface covering, and regardless of whether that surface covering obscures the grain of the wood. 42
43 AD/CVD Hardwood Plywood The panels are included regardless of dimension (thickness, length, width, thickness of layers). Core can be any material veneer plies, fiberboard, particleboard, coniferous wood, non-coniferous wood. Panels included regardless of panel finishing sanded, distressed, hand-scraped, etc. Panels included even if trimmed, cut to size, notched, punched, drilled, or if underwent minor processing. Includes panels that underwent minor processing in a third country. 43
44 Included in scope Veneered Particle Board Panels with two outer wood layers and a core of any material Laminated Veneer Lumber Veneer-core plywood Blockboard, lumber-core plywood Veneered Fiberboard 44
45 Included in scope Hardwood plywood and veneered panels are included in the scope regardless of coatings or surface coverings (where a material coats or covers the face or back ply). Includes opaque coverings. MDF Paper MDO, HDO Phenolic film-faced Plastic 45
46 Excluded from Scope Structural plywood that is manufactured to meet U.S. Products Standard PS 1-09, PS 2-09, or PS 2-10 for Structural Plywood and which has both a face and a back veneer of coniferous wood. Radiata pine plywood 46
47 Excluded from Scope Multilayer wood flooring from China Furniture and cabinets, assembled and unassembled Non-flat panels Fully bamboo panels Phenolic coating on faces and edges, 90g/m3 or more Products with a face and back of cork Finished table tops, ready to assemble Certain LVL door/window parts Non-flat panels Certain LVL door parts top layer machined with a curved edge and one or more profile channels throughout 47
48 You need another break 48
49 Manufacturing Scenarios Plywood platform from China, sent to Vietnam, where a face ply is laminated on. What is the country of origin? Why? The c/o is China. 19 USC 1304 states that the country of origin is the country where the substantial transformation took place. That was the manufacturing of veneers (4408) into plywood (4412) plywood leaves China, and is still 4412 after Vietnam manufacturing. Would this product be subject to AD/CVD? YES. 49
50 Manufacturing Scenarios Veneers are cut in China and shipped to Vietnam, where they are laminated into plywood panels. What is the country of origin? Why? The c/o is Vietnam. The substantial transformation of veneers (4408) into plywood (4412) takes place in Vietnam. This renders Vietnam the c/o. Would this product be subject to AD/CVD? NO. The product is of Vietnamese origin and is not subject to the AD/CVD cases. 50
51 Manufacturing Scenarios Hardwood plywood faced with Radiata pine is shipped from China to Vietnam, where it is overlaid with birch veneer. What is the country of origin? Why? The c/o is China. 19 USC Country where substantial transformation takes place is the country of origin. This is where veneers (4408) are transformed into plywood (4412). Would this product be subject to AD/CVD? Yes. The product entering the U.S. is birch-faced plywood with c/o China. This is plainly included in the scope. 51
52 Bonus! What s another name for a woodchuck? GROUNDHOG or MARMOT or PIG-WHISTLE! 52
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