CLA-2 CO:R:C:M 954982 KCC

Mr. John Mattson
Norman G. Jensen, Inc.
3050 Metro Drive, Suite #300
Minneapolis, Minnesota 55425

RE: HRL 953670 modified; transaxle; Workman 3000 Series Vehicles; 8704; motor vehicles for the transport of goods; EN 87.08; General EN (III) Parts and Accessories

Dear Mr. Mattson:

This is in response to your letter dated September 7, 1993, on behalf of the Toro Company, requesting modification of Headquarters Ruling Letter (HRL) 953670 dated July 16, 1993. That ruling provided the tariff classification of transaxles for the Workman 3000 Series Vehicles under the Harmonized Tariff Schedule of the United States.

FACTS:

Based on the information in your letter of November 23, 1992, and the attached brochure, in HRL 953670, we classified transaxles for the Workman 3000 Series Vehicles under heading 8407, HTSUS, as a reciprocating piston engine of a kind used for the propulsion of vehicles of chapter 87, or under heading 8408, HTSUS, as compression-ignition internal combustion piston engine (diesel or semi-diesel). You now state that the facts in HRL 953670 are incorrect because, as imported, the transaxles do not contain engines.

The transaxles under consideration are for the Workman 3000 Series Vehicles which is a relatively small 4-wheel work vehicle with two front seats and an open cargo area for the transportation of merchandise. The vehicle can be used in a variety of settings (park and sports grounds, worksites, factories, agricultural fields, etc.).

The Workman 3000 Series utilizes the Toro transaxle which is incorporated into one die cast aluminum housing. The unit has a 3-speed synchromesh transmission for smooth, easy shifting and quiet operation, a high-low range that delivers six distinct work ratios, a manual difflock to kick in extra traction when required, high efficiency spiral bevel differential gears, and an integrated hydraulic strainer and pump. This component is directly coupled to an engine with an automotive type bell housing, and a clutch to complete an all-enclosed power train. The transaxle precisely delivers power to the rear wheels.

In the current situation, you state that the product to be imported is the transaxle without an engine.

ISSUE:

What is the classification of the transaxle designed for use in the Workman 3000 Series Vehicles under the HTSUS?

LAW AND ANALYSIS:

The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUS, 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...."

In HRL 953670, we determined that the Workman 3000 Series Vehicles were classified under heading 8704, HTSUS, which provides for "Motor vehicles for the transport of goods...." We are still of this opinion. See, HRL 953670, pg. 2.

Without an engine, the transaxles are not classifiable as engines under headings 8407 or 8408, HTSUS. We are of the opinion that the transaxles in this case are classified under heading 8708, HTSUS, which provides for "Parts and accessories of the motor vehicles of headings 8701 to 8705...."

Explanatory Note (EN) 87.08 of the Harmonized Commodity Description and Coding System (HCDCS) (pg. 1432) states that "[t]his heading covers parts and accessories of the motor vehicles of headings 87.07 to 87.05, provided the parts and accessories fulfil both the following conditions:

(i) They must be identifiable as being suitable for use solely or principally with the above-mentioned vehicles; and (II) They must not be excluded by the provisions of the Notes to Section XVII (see the corresponding General Explanatory Notes)."

EN (III) Parts and Accessories (pg. 1410) states that the headings of Section XVII "...apply only to those parts or accessories which comply with all three of the following conditions: (a) They must not be excluded by the terms of Note 2 to this Section...

(b) They must be suitable for use solely or principally with the articles of Chapters 86 to 88... (c) They must not be more specifically included elsewhere in the Nomenclature...."

Additionally, EN 87.08 lists exemplars that are classifiable under heading 8708, HTSUS, such as:

(D) Gear boxes of all types (mechanical, overdrive, preselector, electro-mechanical, automatic, etc.); torque converters; gear box casings; shafts (other than internal parts of engines or motors); gear pinions; direct-drive dog-clutches and selector rods, etc...

(F) Other transmission parts and components for example, propeller shafts, half-shafts; gears, gearing; plain shaft bearings; reduction gear assemblies; universal joints)....

The ENs, although not dispositive, are to be looked to for the proper interpretation of the HTSUS. 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

The transaxles under consideration are not excluded by the Notes to Section XVII, HTSUS. Based on the information provided, we are of the opinion that the transaxles are solely or principally used with the Workman 3000 Series Vehicles, which are vehicles of heading 8704, HTSUS. Moreover, the transaxles are not more specifically provided for elsewhere in the HTSUS. Therefore, the transaxles under consideration are classified under subheading 8708.40.10, HTSUS, which provides for "...Gear boxes...For the vehicles of subheading 8701.20, or heading 8702 or 8704."

HOLDING:

The transaxles without engines for the Workman 3000 Series Vehicle are classified under subheading 8708.40.10, HTSUS, which provides for "Parts and accessories of motor vehicles of headings 8701 to 8705...Gear boxes...For the vehicles of subheading 8701.20, or heading 8702 or 8704", which is dutiable at the Column 1 rate of 3.1 percent ad valorem.

HRL 953670 is modified as set forth above.

Sincerely,

John Durant, Director Commercial Rulings Division