CLA-2 CO:R:C:M 089242 DFC
Mr. Clayton F. Davis
Director,
Division of Regulations
State House Station 28
Augusta, Maine 04333
RE: Evaporator, Sap; Separator, reverse osmosis
Dear Mr. Davis;
In a letter dated April 18, 1991, you inquired as to
the tariff classification under the Harmonized Tariff Schedule of
the United States Annotated (HTSUSA), of a reverse osmosis
separator and a sap evaporator.
FACTS:
These two articles are used in the removal of excess water
from maple sap as part of the processing of the maple sap into
maple syrup. The reverse osmosis separator removes water by a
filtering process in which a membrane permeable by water retains
the more viscous sap. Further removal of excess water is
effected by the application of heat in the evaporator.
ISSUE:
Whether the reverse osmosis separator and the sap evaporator
are entitled to duty free treatment under subheading 9817.00.50,
HTSUSA, as machinery, equipment and implements to be used for
agricultural or horticultural purposes.
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LAW AND ANALYSIS:
You assert that this equipment was entitled to duty-free
treatment under the Tariff Schedules of the United States
(TSUS), as agricultural implements not specially provided for.
However, when the HTSUSA became effective on January 1, 1989,
this type of machinery was classified as filtering machinery.
You ask that a more specific ruling be issued identifying the
use of such machinery and allowing free entry when it is clearly
used for agricultural purposes.
Under the prior schedules, reverse osmosis separators were
classified in item 661.95, TSUS, as filtering and purifying
machinery and apparatus for liquids or gases with duty at the
rate of 3.9 percent ad valorem. Classification under item
666.00, TSUS, with duty free entry was precluded because the only
part of that item's description they could possibly fit viz.,
"agricultural and horticultural implements not specially provided
for" by its very language excluded them.
Sap evaporators which concentrated the sap by heat were
classified under item 666.20, TSUS, as machinery for use in the
manufacture of sugar. It should be noted that they would have
been classified in a dutiable provision, Item 661.68, TSUS, which
provided for industrial machinery, plant . . . for the treatment
of materials by a process involving a change of temperature but
for the exclusion in that provision of sugar machinery.
Classification of goods under the HTSUSA is governed by
the General Rules of Interpretation (GRI's). GRI 1 provides
that "classification shall be determined according to the terms
of the headings and any relative section or chapter notes, and
provided such headings or notes do not otherwise require,
according to [the remaining GRI's taken in order]." In other
words, classification is governed first by the terms of the
headings of the tariff and any relative section or chapter notes.
Machinery for sugar manufacture is entitled to duty-free
treatment under subheading 8438.30.00, HTSUSA. The Explanatory
Notes to the HTSUSA (EN), although not dispositive, should be
looked to for the proper interpretation of the HTSUSA. See 54 FR
35128 (August 23, 1989). The EN to heading 84.38 at page 1224
-3-
excludes from that heading juice concentration plant
(8419),vacuum boiling or crystallizing pans and other plant of
heading 84.19 and filter presses (8421). Heading 8419, HTSUSA,
unlike item 661.68, TSUS, does not exclude sugar machinery from
classification thereunder. The separator and evaporator cannot
be classified under subheading 8436.80.00, HTSUSA, as other
agricultural machinery, because they are more specifically
provided for under headings 8419 and 8421, HTSUSA. We note that
EN (b) to heading 84.36 at page 1218 states in pertinent part
that "[t]he heading does not cover: [m]achinery and plant
operating by processes involving a change of temperature (heading
8419)." Although heading 8421 is not specifically mentioned as
being excluded, the EN are not exhaustive. Based on the
foregoing, it is our position that the separator is normally
classifiable under subheading 8421.29.00, HTSUSA, and the
evaporator is classifiable under subheading 8419.89.50, HTSUSA.
The issue then to be resolved is whether the separator
and the evaporator are eligible, upon certification of actual
use, for duty free entry under subheading 9817.00.50, HTSUSA. In
Headquarters Ruling Letter 073168 dated June 6, 1984, Customs
held that these items were not eligible for duty-free treatment
under item 870.40, TSUS, the predecessor provision to subheading
9817.00.50, HTSUSA. It remains our opinion that the processing
of maple sap into maple syrup, first by the reverse osmosis
separator and subsequently, by the evaporator, though performed
on a farm, is not an agricultural or horticultural activity.
Unlike cleaning, sorting and grading of agricultural products,
the processing of sap into maple syrup is more than a simple
preparation of the product for market. It changes the
agricultural product, maple sap, to maple syrup. Consequently,
it is our opinion that the separator and the evaporator do not
qualify for duty-free treatment under subheading 9817.00.50,
HTSUSA.
HOLDING:
The reverse osmosis separator and the sap evaporator do
not qualify for duty-free treatment under subheading 9817.00.50,
HTSUSA, as machinery, equipment and implements to be used for
agricultural or horticultural purposes.
The reverse osmosis separator is classifiable under
subheading 8421.29.00, HTSUSA, as filtering or purifying
machinery and apparatus for liquids, other, with duty at the
rate of 3.9 percent ad valorem.
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The sap evaporator is classifiable under subheading
8419.89.50, HTSUSA, as machinery, whether or not electrically
heated, for the treatment of materials by a process involving a
change of temperature such as heating, evaporating, other, other.
The applicable rate of duty for this provision is 4.2 percent ad
valorem.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc NY Seaport
1cc Mike Rocks NY Seaport
1cc Legal Reference
1cc DD Portland, Maine
cahill library/peh
098994