CLA-2 OT:RR:CTF:TCM HQ H243822 TNA
Port Director, Service Port-Area Port Great Falls
U.S. Customs and Border Protection
Post Office Box 789
Great Falls, MT 59403-0789
Attn: Tami Simmons, Import Specialist
Re: Protest and Application for Further Review No. 3304-12-100075; Chemical Additive Unit
Dear Port Director:
The following is our decision regarding Protest and Application for Further Review No. 3304-12-100075, timely filed on November 5, 2012, on behalf of Thayer Imports, Inc., (“Thayer” or “Protestant”) regarding the tariff classification of a chemical additive unit under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of a chemical additive unit (“unit”). It is used in the fracking process for oil, in order to transport, mix, and pump chemicals that are used in the fracking process. This unit consists of many components and is built into a trailer, a non-mechanically propelled vehicle designed to be towed by another vehicle. The subject merchandise is imported as a single item, with the unit permanently affixed to the trailer. The unit is fitted with a mixing/stirring device that is used to keep the chemicals from settling and becoming unusable during transport and storage. It does not stir or mix the chemicals with any other substance. The mixing/stirring device is designed for mixing in a stationary position only, and does not mix the chemicals during transport.
The subject unit is also fitted with hoses and pumps for different types of chemicals and additives. These pumps are rotary positive displacement pumps. Once the chemical additive unit reaches its destination fracking site, it will be used as part of the fracking system, where it will pump the chemicals to an entirely separate unit for mixing with water. The subject unit is also outfitted with loading tanks, storage areas, controls for the measurements of fluids and temperature unit, and a remote control for operation outside the laboratory facility.
The subject merchandise entered on April 29, 2011, in subheading 8716.40.00, HTSUS, as “Trailers and semi-trailers; other vehicles, not mechanically propelled; and parts thereof: Other trailers and semi-trailers.” It was liquidated on May 11, 2012, in subheading 8479.89.98, HTSUS, which provides for “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and mechanical appliances: Other: Other.” Protestant now claims classification as entered.
ISSUE:
Whether the subject merchandise is a trailer or semi-trailer of heading 8716, HTSUS; a pump for liquids of heading 8413, HTSUS; or a machine or mechanical appliance, having individual functions, not specified or included elsewhere in this Chapter, of heading 8479, HTSUS?
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. §1514(a) (2) as a decision on classification. The protest was timely filed, within 180 days of liquidation of the first entry. (Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2) (B) (ii), (iii) (codified as amended at 19 U.S.C. § 1514(c) (3) (2006)).
Further Review of Protest No. 3304-12-100075 is properly accorded to Protestant pursuant to 19 C.F.R. § 174.24(b) because Protestant alleges that the specific circumstances of this protest have not been ruled by the Commissioner of Customs or his designee or the Customs courts. Specifically, Protestant argues that CBP has not previously classified this exact product.
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provisions of law for all purposes.
GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order.
The HTSUS provisions under consideration are as follows:
8413 Pumps for liquids, whether or not fitted with a measuring device; liquid elevators; part thereof:
8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof:
8716 Trailers and semi-trailers; other vehicles, not mechanically propelled; and parts thereof:
Note 1 to Section XVI, HTSUS, to which Chapter 84, HTSUS, belongs, states, in pertinent part, the following:
This section does not cover:
(l) Articles of section XVII.
Note 3 to Section XVI, HTSUS, provides, in pertinent part, the following:
Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The EN for heading 8413, HTSUS, states, in pertinent part, the following:
This heading covers most machines and appliances for raising or otherwise continuously displacing volumes of liquids (including molten metal and wet concrete), whether they are operated by hand or by any kind of power unit, integral or otherwise….
The machines of this heading can be subdivided, according to their system of operation, into the following five categories:
* * *
(B) ROTARY POSITIVE DISPLACEMENT PUMPS
In these also, the intake and discharge of the liquid is effected by suction and compression, in this case produced by cams (lobes) or similar devices, rotated continuously on an axis. These devices make contact, at one or more points with the wall of the body of the pump, and form in this way the chambers in which the liquid is displaced.
The EN for heading 8479, HTSUS, states, in pertinent part, the following:
This heading is restricted to machinery having individual functions, which:
Is not excluded from this Chapter by the operation of any Section or Chapter Note.
and (b) Is not covered more specifically by a heading in any other Chapter of
the Nomenclature.
and (c) Cannot be classified in any other particular heading of this Chapter
since :
No other heading covers it by reference to its method of
functioning, description or type.
and (ii) No other heading covers it by reference to its use or to the
industry in which it is employed.
or (iii) It could fall equally well into two (or more) other such
headings (general purpose machines)…
The EN to heading 8716, HTSUS, provides, in pertinent part, the following:
This heading covers a group of non-mechanically propelled vehicles (other than those of the preceding headings) equipped with one or more wheels and constructed for the transport of goods or persons. It also includes non-mechanical vehicles not fitted with wheels (e.g., sledges, special sleds running on timber trackways).
The vehicles of this heading are designed to be towed by other vehicles (tractors, lorries, trucks, motorcycles, bicycles, etc.), to be pushed or pulled by hand, to be pushed by foot or to be drawn by animals.
The heading includes:
(A) Trailers and semi-trailers.
For the purposes of this heading, the terms “trailers” and “semi-trailers” means vehicles (other than side-cars) of a kind designed solely to be coupled to another vehicle by means of a special coupling device (whether or not automatic).
The most important types of trailers and semi-trailers falling in this group are those designed for use with motor vehicles. Trailers usually have two or more sets of wheels, and a coupling system mounted on the swivelling front wheels which steer the vehicles. Semi-trailers are fitted with rear wheels only, the forward end resting on the platform of the towing vehicle to which it is coupled by a special coupling device…
Trailers falling here include:…
(4) Other trailers for the transport of goods such as:
(a) Tanker trailers (whether or not fitted with pumps)…
VEHICLES FITTED WITH MACHINERY, ETC.
The classification of units consisting of vehicles with permanently built-on machines or appliances is determined according to the essential character of the whole. The heading therefore covers such units which derive their essential character from the vehicle itself. On the other hand, units deriving their essential character from the machine or appliance they incorporate are excluded.
It follows from the above that:
Trucks, carts or trailers with built-on tanks, whether or not they are fitted with subsidiary pumps for filling or emptying purposes, are classified here.
The following, for example, are excluded and fall in the heading relating to the machine or appliance:…
Machines and appliances mounted on a simple wheeled chassis, designed to be towed, such as mobile pumps and compressors (heading 84.13 or 84.14) and mobile cranes and ladders (heading 84.26 or 84.28).
Heading 8716, HTSUS, provides for, inter alia, “trailers and semi-trailers.” It includes non-mechanically propelled vehicles that have one or more wheels and are constructed for the transport of goods. Furthermore, the vehicles of heading 8716, HTSUS, are designed to be towed by other vehicles, such as trucks and tractors. However, the classification of units that consist of vehicles with permanently built-on machines is determined according to the essential character of the whole. Heading 8716, HTSUS, includes these units when they derive their essential character from the vehicle itself. Thus, trucks, carts or trailers with built-on tanks are classified here whether or not they are fitted with subsidiary pumps for filling or emptying purposes. By contrast, units deriving their essential character from the machine they incorporate are excluded. Thus, machines and appliances that are mounted on a simple wheeled chassis and designed to be towed, such as mobile pumps, are excluded from classification in heading 8716, HTSUS. Furthermore, EN 87.16, as cited above, directs classification of such mobile pumps to headings 8413 and 8414, HTSUS, as appropriate.
The items of heading 8413, HTSUS, are machines and appliances for raising or otherwise continuously displacing volumes of liquids, including molten metal and wet concrete. The heading includes rotary positive displacement pumps, which use rotating devices to effect the intake and discharge of the liquid by way of suction and compression. See EN 84.13. According to information supplied by the importer, the pumps contained in the subject merchandise are rotary positive displacement pumps. Under Note 3 to Section XVI, HTSUS, the merchandise is classified according to its principal function. Once the subject merchandise is transported to a fracking site, it is used as a mixer, and then pumps the chemicals to a separate unit. Both the transportation and the mixing functions are in the service of this unit’s ability to pump its chemicals to the fracking site. As a result, we find that the pumps constitute the principal function of the subject merchandise. Thus, the subject merchandise is described by the terms of heading 8413, HTSUS, and will be classified there. This conclusion is consistent with a prior CBP ruling that classifies nearly identical merchandise in heading 8413, HTSUS, which was issued subsequent to the filing of the subject protest and AFR: NY N239029, dated March 26, 2013. See also NY 850742, dated April 26, 1990 (classifying a concrete pump in heading 8413, HTSUS). Because the subject merchandise’s pumps determine its essential character, it is precluded from classification in heading 8716, HTSUS.
Lastly, we note that heading 8479, HTSUS, does not describe the principal function of the subject unit. Furthermore, merchandise is only classified in heading 8479, HTSUS, when it is not described elsewhere in the nomenclature. The subject merchandise is described by the terms of heading 8413, HTSUS. As a result, the subject merchandise is precluded from classification in heading 8479, HTSUS.
HOLDING:
By application of GRI 1, the subject chemical additive unit is classified in heading 8413, HTSUS, specifically subheading 8413.60.00, HTSUS, which provides for: “Pumps for liquids, whether or not fitted with a measuring device; liquid elevators; part thereof: Other rotary positive displacement pumps.” The general column one rate of duty is free.
Because reclassification of the merchandise as indicated above will result in the same rate of duty as claimed by the Protestant, you are instructed to allow the protest in full.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision, the Office International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP website at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division