CIT Rules on Classification of Rare Earth Carbonate
In Rhodia, Inc. v. U.S., the Court of International Trade granted a summary judgment to Rhodia regarding an imported product identified as a "rare earth carbonate mixture" that consisted of various rare earth carbonates, rare earth ammonium double sulfates, water, and impurities, ruling that it should have been classified under HTS 3824.90.39 (1999).
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Customs had classified and liquidated the imported product as a cerium compound under HTS 2846.10, (1999), which reads "Compounds, inorganic or organic, of rare-earth metals, Cerium compound." At trial, Customs agreed that cerium carbonate was present in the mixture as only one of several components, and that their classification as a cerium compound was incorrect.
Instead, Customs argued that the correct classification should have been under HTS 2846.90.80, which covers "Other" compounds in heading 2846. Customs asserted that although the imported product contained rare earth ammonium double sulfates, they had no commercial value, or were present in such insignificant amount as to be considered de minimis.
The CIT found that the product was a "mixture" of two salt compounds, the rare earth carbonates and the rare earth ammonium double sulfates. Salt compounds contain both a positive ion structure and a negative ion structure. In this mixture, the two salts (rare earth carbonates and rare earth ammonium double sulfates), have the same structure, but different positive and negative ion structures.
The CIT stated that the Explanatory Note to HTS 2846 excludes classification of salt mixtures having different negative ion structures, whether or not they contain the same positive ion structures. Based on this exclusion, the CIT rejected classification under HTS 2846, and turned to HTS 3824 which includes " chemical products and preparations of the chemical or allied industries not elsewhere specified or includedOther," which it ruled to be sufficiently broad to include this rare earth carbonate mixture.
CIT Slip Op. 06-118 (dated 07/28/06) available at http://www.cit.uscourts.gov/slip_op/Slip_op06/06-118.pdf