CLA-2 RR:TC:MM 960150 JAS
Port Director of Customs
P.O. Box 610
Pembina, ND 58271
RE: I.A. 41/96; BioTech Shelter, Farm Enclosure; Structure of Steel Covered with Aluminum-Coated UV-Treated Polyethylene Knit Fabric; Structures of Iron or Steel, Heading 7308; Articles of Plastic, Heading 3926; Prefabricated Buildings, Heading 9406.00; Composite Goods, GRI 3(b), Essential Character; HQ 959649, HQ 086548, NY 894119, NY 830211
Dear Port Director:
This is our decision on Internal Advice 41/96, which you
initiated on the classification under the Harmonized Tariff
Schedule of the United States (HTSUS), of the BioTech Shelter, a
product of Canada.
FACTS:
The article in issue is the Innovator 2000 BioTech Shelter,
imported unassembled. The importation consists of a framework of
tubular galvanized steel, a 30 ft. x 70 ft. rectangular
tarpaulin, and lengths of rope. The tarpaulin is made of knit
textile fabric, polyethylene coated on both sides, to which a
thin layer of aluminum and an ultraviolet light protective
coating have been added. The tarpaulin, which is edge worked and
has grommets called D-rings stitched to the edges every 18
inches, forms a semicircular roof, open at both ends, that curves
down and attaches to walls of either wood or concrete, both of
which are sourced domestically. These, together with the lengths
of rope, anchor the Shelter to the ground. We are informed that
the wood and/or concrete foundations are at the option of the
user and that simpler assemblies utilize the ropes attached to
metal stanchions in the ground. The BioTech Shelter is commonly
used on farms to provide protection from the elements for
livestock, crops and equipment. You state that the invoices - 2 -
attribute the the following costs or values to the components of
the Shelter: slightly over 54% for the tubular pipe sections,
nearly 40% for the tarpaulin, and less than 10% for the rope.
The tubular sections represent 80% of the total weigh of the
Shelter, while the tarpaulin and rope represent less than 20% and
less than 4%, by weight, respectively.
You cite two administrative rulings, NY 830211, dated June
17, 1988, and NY 894119, dated February 9, 1994, on merchandise
felt to be substantially similar to the BioTech Shelter, but
which classify the merchandise differently. In your opinion, the
BioTech Shelter's ease of assembly and semi-permanent nature are
significant, and its essential character is imparted by the
tarpaulin. You note the possibility that the BioTech Shelter may
be a prefabricated building, classifiable in heading 9406.00,
HTSUS. Your report does not indicate how the BioTech Shelter was
entered or whether the importer has a position in the matter.
ISSUE:
Whether the BioTech Shelter is a good of heading 9406.00;
whether it is a good of heading 3926 or of heading 7308.
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. GRI 3 provides
classification criteria where goods are prima facie classifiable
under two or more headings.
The Harmonized Commodity Description and Coding System
Explanatory Notes (ENs) constitute the official interpretation of
the Harmonized System. While not legally binding, 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 ENs should always be consulted. See T.D.
89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
- 3 -
As to the possible heading 9406.00 classification, tariff
terms that are not defined either in the text of the HTSUS or in
an equivalent Explanatory Note are to be construed in accordance
with their common and commercial meanings, which are presumed to
be the same. In this case, the term "Prefabricated buildings" is
not defined as indicated above. However, relevant ENs at pp.
1706 and 1707 state in part that the goods of heading 9406.00,
also referred to as industrialized buildings, are of all
materials and can be designed for a variety of uses, among which
are worksite accommodation, shops and sheds. When presented
unassembled, these "buildings" may include walls, trusses, beams,
joists, sills and insulation. When imported equipped, only
built-in equipment normally supplied is classified with the
building. This equipment includes electrical fittings, heating,
air conditioning, sanitary and kitchen equipment, and items of
furniture which are built in or designed to be built in, such as
cupboards. The ENs continue by stating materials for finishing
such buildings are to be classified with the building, provided
they are imported in appropriate quantities. These materials
include nails, glue, plaster, mortar, electric wire and cables,
paint, wallpaper, carpets, etc. In our opinion, the BioTech
Shelter is not the type of construction described in these ENs
and is not encompassed by the term "Prefabricated buildings." In
addition, there is no indication that the BioTech Shelter is
bought and sold or commonly regarded in the industry as a
building. See HQ 959649, dated April 1, 1997, on heading 9406.00
merchandise.
The BioTech Shelter is prima facie classifiable in several
headings, each of which describes part only of the good. Under
GRI 3(a), each heading is deemed to be equally specific. Under
GRI 3(b), the BioTech Shelter is a composite good made up of
different materials and/or components which is to be classified
as if consisting only of that material or component which imparts
the essential character to the whole. We will discuss only those
headings which, in our opinion, merit consideration in
determining essential character: the tarpaulin is provided for in
heading 3629, as an article of plastics; the unassembled steel
tubular sections in heading 7308, as structures of iron or steel;
the aluminum coating component is provided for in heading 7616,
as articles of aluminum. We conclude that heading 7326, articles
of iron or steel and heading 7616, articles of aluminum, are less
specific provisions and do not merit consideration. In this
case, the knit textile fabric component is not considered because - 4 -
textile fabrics completely embedded in plastics or entirely
covered on both sides by plastics, such plastics being visible to
the naked eye, are regarded as articles of Chapter 39. See HQ
086548, dated April 12, 1990.
In essential character determinations, Customs may consider
the nature of the material or component, its bulk, quantity,
weight or value, or by the role of a constituent material in
relation to the use of the good. Other factors may be considered
relevant, depending on the particular merchandise. In this case,
the steel tubular components clearly predominate by cost or value
and by weight. In addition, they provide strength and support to
the tarpaulin and give form and shape to the Shelter. However,
the nature of the polyethylene tarpaulin and its role in relation
to the use of the Shelter are equally compelling factors.
Considering bulk or size, the tarpaulin clearly predominates over
the steel tubulars. More importantly, however, the Shelter is
designed to provide a safe haven for farm animals, crops and
equipment. This is how it is marketed and why users purchase it.
The polyethylene tarpaulin is the component that affords farm
equipment, animals, and crops protection from inclement weather.
It has a special ultraviolet light protective coating,
specifically designed to shield animals and humans from the sun's
harmful rays. For these reasons, we conclude that in this case
it is the 30 ft. x 70 ft. tarpaulin whose role is critical and
which imparts the essential character to the BioTech Shelter.
The Shelter is to be classified as if it were an article of
heading 3926.
In NY 894119, dated February 9, 1994, one of the
administrative decisions you cite, substantially similar
merchandise was held to be classifiable in subheading 3926.90.95,
HTSUS. The other decision you cite, NY 830211, dated June 17,
1988, in considering a similar article, found that the base metal
components imparted the essential character, and classified the
good in subheading 7308.90.90, HTSUS, as a structure of iron or
steel. In that case, however, in addition to the steel
framework, a substantial number of other steel articles, to
include ventilation hardware, cables, bolts, turnbuckles, screws,
and other miscellaneous hardware, were present. On the basis of
the particular facts in that case, the decision in NY 830211 is
legally supportable.
- 5 -
HOLDING:
Under the authority of GRI 3(b), the BioTech Shelter is
provided for in heading 3926. It is classifiable in subheading
3926.90.95( now 98), HTSUS.
No later than 60 days from the date of this letter the
Office of Regulations and Rulings will take steps to make the
decision available to Customs personnel via the Customs Rulings
Module in ACS and to the public via the Diskette Subscription
Service, the Freedom of Information Act, and other public access
channels.
Sincerely,
John Durant, Director
Tariff Classification
Appeals Division