H310990

H310990 July 9, 2026 OT:RR:CTF:EPDR H310990 SAB CATEGORY: Entry Mr. Bruce H. Leeds, Esq. Braumiller Law Group, PLLC 5220 Spring Valley Road, Suite 200 Dallas, TX 75254 RE: Temporary Importation under Bond; Steel Plates; United States-Mexico-Canada (USMCA); Antidumping and Countervailing Duties; Section 232 Duties Dear Mr. Leeds: This letter is in response to your ruling request of May 4, 2020, submitted on behalf of your client, DMC Global. DMC Global seeks a determination as to whether steel plates imported for purposes of being subjected to cladding operations are eligible for duty-free treatment under subheading 9813.00.05 of the Harmonized Tariff Schedule of the United States (“HTSUS”) as a temporary importation under bond (“TIB”). Additionally, DMC Global requests guidance on the application of antidumping and countervailing duties (“AD/CVD”) and Section 232 duties to goods entered under a TIB. Finally, DMC Global seeks a determination as to the applicability of the United States-Mexico-Canada Agreement (“USMCA”) – specifically the applicability of its duty-deferral provisions to goods exported to Canada.1 We regret the delay in our response. Our decision follows. FACTS: DMC Global imports steel plates from Germany. DMC Global states that at importation these steel plates are classified under subheadings 7208.51.0060, 7208.52.0000, or 7225.40.3050, of the HTSUS. DMC Global notes that these steel plates may be subject to both AD/CVD and Section 232 duties if entered for consumption. See Certain Carbon and Alloy Steel Cut-To-Length Plate from Austria, Belgium, France, the Federal Republic of Germany, Italy, Japan, the Republic of Korea, and Taiwan: Amended Final Affirmative Antidumping Determinations for France, the Federal Republic of Germany, the Republic of Korea and Taiwan, and Antidumping Duty Orders, 82 Fed. Reg. 24096 (May 25, 2017); Chapter 99, 1 While DMC Global requested clarification concerning the application of its goods under the North American Free Trade Agreement (“NAFTA”), due to the USMCA going into effect on July 1, 2020, all prospective entries would be subject to the provisions of the USMCA. 2 Subchapter III, HTSUS. Once imported into the United States, the steel plates will undergo a cladding operation called explosion welding. Explosion welding is described by DMC Global as a “solid-state process where welding is accomplished by accelerating [a component] at extremely high velocity through the use of chemical explosives.” This operation is generally utilized to clad carbon steel plates with a layer of corrosion resistant material. The cladding, or layer of corrosion resistant material, may consist of aluminum, copper, titanium, or stainless steel. DMC Global explains that the process first entails inspecting the materials to be used, specifically the backing and cladding alloy. Next, DMC Global grinds the mating surfaces and assembles the backer, cladder alloy, and explosive. The explosion welds the assembled materials together, and the cladded steel plates are then flattened and cut. Finally, the cladded steel plates are tested and inspected. DMC Global further explains that no bulk heating occurs during explosion welding, signifying that none of the metals are diluted, diffused, or subjected to intermetallic formation. A key feature of the process is to ensure “high shear strength and high tensile strength” steel plates, in addition to conferring corrosion resistance. Once the cladded steel plates pass inspection and testing, DMC Global will export them from the United States to Canada for further processing into pressure tanks and similar applications. DMC Global states that, at exportation, the cladded steel plates are classified under subheadings 7210.90.1000 or 7225.99.0090 of the HTSUS. DMC Global states that exported plates would be subject to the USMCA’s duty-deferral provisions, meaning if entered under a TIB at exportation “the plates would be assessed duty as if they had been withdrawn for domestic consumption.” DMC Global posits that the explosion welding cladding process to which the imported steel plates will be subjected constitutes “processing” for purposes of entry under TIB subheading 9813.00.05, HTSUS. DMC Global notes that CBP has previously determined that “welding and integration” may constitute processing which confers eligibility for duty-free treatment of merchandise entered under a TIB. DMC Global also posits that if CBP determines its imported steel plates are eligible for entry under TIB subheading 9813.00.05, HTSUS, they would be exempt from any AD/CVD and Section 232 duties that would otherwise be applicable at entry for consumption. Citing to Headquarters Ruling Letter (“HQ”) 223491, dated March 30, 1992, DMC Global notes that CBP has previously determined TIB entries are not entries for consumption and are therefore not subject to payment of AD/CVD. DMC Global inquires whether the cladded steel plates would nevertheless become subject to AD/CVD and Section 232 upon exportation to Canada due to the UMSCA’s duty-deferral provisions. ISSUES: I. Whether explosion cladding constitutes a “process” under subheading 9813.00.05, HTSUS. II. Whether goods entered under TIB subheading 9813.00.05, HTSUS, and exported to Canada, are subject to Section 232 duties and AD/CVD. 3 LAW AND ANALYSIS: I. Whether explosion welding cladding constitutes a “process” under subheading 9813.00.05, HTSUS. General Note 1, HTSUS, dictates that all merchandise imported into the United States is subject to duty unless specifically exempted therefrom. Such an exemption is accorded to articles temporarily imported for repair, alteration, or processing, including processing that results in articles manufactured or produced in the United States, under subheading 9813.00.05, HTSUS. See U.S. Notes 1-2 of Subchapter XIII, Chapter 98, HTSUS. Duty-free treatment under this subheading is conditioned on the imported merchandise being exported or destroyed within one year from the date of importation. See 19 C.F.R. § 10.37. This one-year period may be extended to one or more additional periods, which, when added to the initial period may not exceed three years. Id. The imported merchandise may not be imported for the purpose of a sale or sale on approval. See U.S. Note 1(a) of Subchapter XIII, Chapter 98, HTSUS; see also 19 C.F.R. § 10.31(a)(3)(ii). CBP has considered the scope of the term “processed” as used in the article description for subheading 9813.00.05, HTSUS, for articles intended to be “repaired, altered, or processed” in the United States. In HQ 224661, dated January 11, 1994, CBP explained that “processing can be a relatively minor procedure or extensive enough to be considered a manufacture or production.” Significantly, CBP has specifically considered whether cladding constitutes a process. In HQ 556530, dated June 12, 1992, CBP determined that cladding carbon steel pipe constituted a process because without cladding the pipe was “incomplete for its intended use in the oil and gas industry . . . [or] suitable for its use in refineries.” The overlay or cladding was necessary to provide the pipe with a “protective coating for corrosion resistance . . . and enhance [its] durability and longevity,” thereby rendering the pipe fit for its intended use. See also Guardian Industries Corp. v. United States, 3 C.I.T. 9, 12 (1982) (holding that processing is performed to render articles suitable for manufacture and their intended use as finished articles) (internal citations omitted). Similarly, in HQ H264562, dated April 3, 2017, CBP determined that hardening steel pipes through an operation called nitriding constituted a process for purposes of subheading 9813.00.05, HTSUS, because it was critical to their intended use as a seal assembly. Although “the pipes treated with and without the nitride process have the same uses,” the nitride treated pipes had an improved ability “to withstand wear, fatigue and corrosion over a longer pe

I. Whether explosion welding cladding constitutes a “process” under subheading 9813.00.05, HTSUS. General Note 1, HTSUS, dictates that all merchandise imported into the United States is subject to duty unless specifically exempted therefrom. Such an exemption is accorded to articles temporarily imported for repair, alteration, or processing, including processing that results in articles manufactured or produced in the United States, under subheading 9813.00.05, HTSUS. See U.S. Notes 1-2 of Subchapter XIII, Chapter 98, HTSUS. Duty-free treatment under this subheading is conditioned on the imported merchandise being exported or destroyed within one year from the date of importation. See 19 C.F.R. § 10.37. This one-year period may be extended to one or more additional periods, which, when added to the initial period may not exceed three years. Id. The imported merchandise may not be imported for the purpose of a sale or sale on approval. See U.S. Note 1(a) of Subchapter XIII, Chapter 98, HTSUS; see also 19 C.F.R. § 10.31(a)(3)(ii). CBP has considered the scope of the term “processed” as used in the article description for subheading 9813.00.05, HTSUS, for articles intended to be “repaired, altered, or processed” in the United States. In HQ 224661, dated January 11, 1994, CBP explained that “processing can be a relatively minor procedure or extensive enough to be considered a manufacture or production.” Significantly, CBP has specifically considered whether cladding constitutes a process. In HQ 556530, dated June 12, 1992, CBP determined that cladding carbon steel pipe constituted a process because without cladding the pipe was “incomplete for its intended use in the oil and gas industry . . . [or] suitable for its use in refineries.” The overlay or cladding was necessary to provide the pipe with a “protective coating for corrosion resistance . . . and enhance [its] durability and longevity,” thereby rendering the pipe fit for its intended use. See also Guardian Industr