CLA-2 CO:R:C:M 950312 KCC
District Director
U.S. Customs Service
Main and Stebbins Streets, P.O. Building
P.O. Box 1490
St. Albans, Vermont 05478
RE: Protest No. 020191100273; prefabricated home package; GRI
2(a); Note 4 to Chapter 94; EN 94.06; essential character
Dear District Director:
This is in response to the Application for Further Review of
Protest No. 020191100273, dated March 26, 1991, which pertains to
the classification of a prefabricated home package under the
Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The merchandise under consideration is a prefabricated home
package. Customs personnel interviewed the protestant, Linwood
Homes Ltd., in August 1991, and ascertained that, normally,
prefabricated home packages are shipped in two truckloads.
Usually, the first shipment contains the material for the main
building structure, and the second shipment contains builders'
fittings such as doors, windows and similar products.
Upon importation into the U.S., you liquidated the
prefabricated home package under subheading 9406.00.40, HTSUS, as
"Prefabricated buildings...Of wood." The protestant contends
that the articles entered into the U.S. do not represent a
complete prefabricated home and, therefore, the items should be
entered and classified separately. A breakdown of the items and
protestant's proposed tariff classification were submitted.
ISSUE:
How are the prefabricated homes to be classified when
imported in separate shipments; the first shipment consisting of
material for the structure and the second shipment consisting of
builders's fittings such as doors, windows, and similar articles?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUS is
governed by the General Rules of Interpretation (GRI's). GRI 1,
HTSUS, requires that classification be determined first according
to the terms of the headings of the tariff and any relative
section or chapter notes and, unless otherwise required,
according to the remaining GRI's, taken in order. GRI 2(a),
HTSUS, states that:
Any reference in a heading to an article shall be taken to
include a reference to that article incomplete or
unfinished, provided that, as entered, the incomplete or
unfinished article has the essential character of the
complete or finished article....
Subheading 9406.00.40, HTSUS, provides for "Prefabricated
buildings...Of wood." Note 4 to Chapter 94, HTSUS, states that:
For the purposes of heading 9406, the expression
"prefabricated buildings" means buildings which are finished
in the factory or put up as elements, entered together, to
be assembled on site, such as housing or worksite
accommodation, offices, schools, shops, sheds, garages or
similar buildings.
Explanatory Note (EN) 94.06 of the Harmonized Commodity
Description and Coding System (HCDCS) states that prefabricated
buildings are generally presented in the form of:
- complete buildings, fully assembled, ready for use;
- complete buildings, unassembled;
- incomplete buildings, whether or not assembled, having the
essential character of prefabricated buildings.
HCDCS, Vol. 4, p. 1582. Therefore, heading 9406, HTSUS, includes
complete assembled and unassembled buildings, and incomplete,
whether or not assembled, buildings having the essential
character of prefabricated buildings.
In general, essential character has been construed to mean
the attribute which strongly marks or serves to distinguish what
an article is; that which is indispensable to the structure, core
or condition of the article. In addition, the Explanatory Notes
provide further factors which help determine the essential
character of goods. Factors such as bulk, quantity, weight or
value, or the role of a constituent material in relation to the
use of the goods are to be utilized, though the importance of
certain factors will vary between different kinds of goods. See,
HCDCS, Vol. 1, p. 4.
An analysis of the facts of the case and the items shipped
indicate that the product imported has the essential character of
a prefabricated building. The shipment at issue contains all the
major parts of a building such as wall sections, glulam beams,
siding, rafters, log-look cedar, etc. We note that, contrary to
the information supplied by the seller, this shipment also
contained framed windows and patio doors. The prefabricated home
package at issue is classified under subheading 9406.00.40,
HTSUS. Furthermore, even if the shipment did not contain the
framed windows and patio doors, we would still find it
classifiable under subheading 9406.00.40, HTSUS. EN 94.06 is
quite clear as to what the provisions for prefabricated buildings
in heading 9406, HTSUS, covers. An incomplete building, whether
or not assembled, having the essential character of a
prefabricated building is properly classified under heading 9406,
HTSUS. See, EN 94.06, HCDCS, Vol. 4, p. 1582. The Explanatory
Notes, although not dispositive are to be looked to for the
proper interpretation of the HTSUS. 54 Fed. Reg. 35127, 35128
(August 23, 1989).
HOLDING:
The prefabricated home package is properly classified under
subheading 9406.00.40, HTSUS, which provides for "Prefabricated
buildings...Of wood." This protest should be denied. A copy of
this decision should be attached to the Customs Form 19 and
mailed to the protestant as part of the notice of action on the
protest.
Sincerely,
John Durant, Director
Commercial Rulings Division