CLA-2:CO:R:C:M 952808 JAS
District Director of Customs
1000 Second Avenue, Suite 2200
Seattle, WA 98104-1049
RE: Absorption Chiller/Heater; Apparatus for Producing
Chilled Water and Hot Water; Refrigerating/Freezing
Apparatus; Subheading 8418.69.00, HTSUS; Parts of
Apparatus Principally Used for Commercial Comfort
Cooling; Section XVI, Note 2, HTSUS; Internal Advice 30/92
Dear Sir:
In a memorandum dated April 21, 1992 (CLA-2 SE:C:D KB), you requested advice on the classification of the Trane Thermachill direct-fired absorption chiller/heater from Japan.
FACTS:
The absorption chiller/heater in issue is a natural gas-fired apparatus used to produce chilled water and hot water for space cooling and heating applications. Apparatus of this type operates without a compressor and consists essentially of a burner (instead of the conventional steam or hot water generator), condenser, evaporator, cooling tower, absorption unit, circulation pump, and heat exchanger. The burner in this case is added after importation.
In operation, the burner heats a solution of water and lithium bromide, causing the lithium bromide to vaporize and the water to remain behind. The vapor condenses in the condenser, with the resulting liquid moving to the evaporator where it evaporates again, absorbing heat in the process. The heated water is passed through the heat exchanger where it gives off some of its heat. The water then goes to the absorption unit where it re-absorbs the lithium bromide vapor from the evaporator. The solution is pumped back through the heat exchanger which absorbs more heat. The cooling tower consists of water sprays, overflow tubes, valves and a water pump. It functions to cool condenser and absorption unit water. - 2 -
Chilled water produced by this apparatus is pumped directly to the building's cooling/heating circulation system. Fans or blowers built into the building's master system, or in individual room units distribute the coolness. These fans are not part of this importation. Humidity is added by condensation as hot air passes over cooler fins in the room units.
The absorption liquid chiller was entered under the provision for air conditioning machines, comprising a motor-driven fan and elements for changing the temperature and humidity, in subheading 8415.82.00, Harmonized Tariff Schedule of the United States (HTSUS).
Because the importation lacks a fan, you question whether the entered provision is correct, or whether the provision for refrigerators and other refrigerating or freezing equipment, in subheading 8418.69.00, HTSUS, may be the appropriate classification. Absorption liquid chilling units are provided for statistically under this subheading. You indicate there are no known rulings on this merchandise under the HTSUS.
ISSUE:
Whether the absorption liquid chillers in issue are goods of heading 8418; whether they are unfinished or incomplete air conditioners of heading 8415, or parts under the same heading.
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.
In accordance with GRI 2(a), 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.
Goods qualifying as parts of machines and apparatus of section XVI are classified in accordance with section XVI, note 2, HTSUS.
As a preliminary issue, a machine of chapter 84 that is used for more than one purpose is, for the purposes of classification, to be treated as if its principal purpose were its sole purpose. Chapter 84, note 7, HTSUS. Submitted literature repeatedly refers to this unit as a "chiller" and identifies apparatus for - 3 -
making "chilled" water with the energy of natural gas. The file also reflects that in climates where freezing or near freezing temperatures are encountered, the hot water produced by these absorption chillers is not sufficient for space heating. In such cases chiller/boiler combinations are required. Hot water produced by the chiller is fed to the boiler as an energy-saving measure. The available evidence indicates that while this gas-fired liquid absorption chiller produces hot water in a reverse flow cycle, its principal purpose is to produce chilled water for space cooling in apartments, hotels, offices and other commercial buildings.
The Harmonized Commodity Description And Coding System Explanatory Notes (ENs) constitute the Customs Cooperation Council's official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the notes should always be consulted. See T.D. 89-80.
Relevant ENs, at p. 1169, indicate that refrigerators and refrigerating equipment of heading 8418 are in the main machines or assemblies of apparatus for the production, in a continuous cycle of operations, of low temperatures (in the region of 0 degrees C or less) at the active cooling element, by the absorption of the latent heat of evaporation of liquified gases (e.g., ammonia, halogenated hydrocarbons), of volatile liquids or, in the case of certain marine types, of water (Emphasis added). Absorption type refrigerators that operate essentially as indicated above are described in the ENs at p. 1170. These utilize an aqueous solution of ammonia as the absorbent and water as the refrigerant. Industry sources we have consulted indicate that ammonia used as the absorbent produces temperatures of 0 degrees C and below required for refrigerating and freezing applications. However, the absorption liquid chiller models in issue here use lithium bromide as the absorbent, and produce water temperatures as low as 43 degrees F (8 degrees C). We are advised that lithium bromide will not produce temperatures which the industry recognizes as required for refrigeration. We conclude, therefore, that the absorption liquid chillers in issue here are not provided for in heading 8418.
The next issue is whether the absorption liquid chillers in issue are unfinished articles of heading 8415 or parts of the same heading. In general, air conditioning machines keep the temperature and humidity of the air in closed spaces at values which provide a sense of comfort to humans. Relevant ENs at p. 1165 indicate that heading 8415 applies only to machines equipped with a motor-driven fan or blower that are designed to change
both the temperature (a heating or cooling element or both) and - 4 -
the humidity (a humidifying or drying element or both) of air. The humidifying element may be separate from the heating/cooling element, or the two may be incorporated in a single unit. Thus, an importation consisting of a liquid chiller of the type under consideration and multiple room units that each incorporate a fan and element for changing humidity, would be the components that comprise a complete air conditioning machine of heading 8415. However, we conclude that an importation consisting of an absorption liquid chiller without a burner, and also without a fan for distributing air and an element for changing humidity, lacks the essential character of an air conditioning machine of heading 8415. This is because the burner initiates the entire process by firing the absorption refrigeration cycle and the fan is necessary for moving the air to the space to be cooled. However, owing to the function it performs, the absorption liquid chiller in issue, even without the burner, is an integral, constituent and component part necessary to the completion and proper operation of an air conditioning machine of heading 8515.
Noting the previous discussion of heading 8418, the absorption liquid chiller is not a good included in any heading of chapters 84 or 85. Section XVI, note 2(a), HTSUS. Owing to its use of the lithium bromide solution to produce temperatures as low as 43 degrees F, we conclude it is a part suitable for use solely or principally with machines or apparatus of heading 8415. Section XVI, note 2(b), HTSUS.
HOLDING:
Under the authority of GRI 1, HTSUS, the Trane liquid absorption chillers are parts of air conditioning machines of heading 8415. Actual classification is in subheading 8415.90.00, HTSUS, parts of air conditioning machines.
Sincerely,
John Durant, Director
Commercial Rulings Division