OT:RR:CTF:CPMM H293256 CKG
Port Director
U.S. Customs and Border Protection
Port of Los Angeles
301 E. Ocean Blvd.
Suite 1400
Long Beach, CA 90802
CC: Craig Callies
U.S. Customs and Border Protection
Supervisory Import Specialist
Base Metals CEE
2350 N. Sam Houston Pkwy E. #900
Houston, TX 77032-3100
Re: Application for Further Review of Protest No. Protest No. 2704-17-103487;
classification of steel barrel nuts
Dear Port Director:
This is in reply to the Application for Further Review (AFR) of Protest No. 2704-17-103487, dated May 12, 2017, on behalf of General Supply and Services, Inc (“Protestant”), contesting the classification and liquidation by U.S. and Customs and Border Protection (CBP) of two entries of steel barrel nuts in subheading 7318.19, HTSUS.
The subject merchandise was entered on February 7 and May 5, 2017 in heading 7318, specifically subheading 7318.16.00, HTSUS, which provides for “Screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Nuts.” The entries were liquidated on July 28, 2017, in subheading 7318.19.00, HTSUS, which provides for “Screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Other.”
FACTS:
The instant merchandise is described as “steel barrel nuts.” They are round slugs made of non-stainless steel, size M36, with internal threading and no exterior threading. The interior threads perpendicular to the length of the nut. They are used to fasten wind turbines blades; the nut is inserted into a hole inside the turbine blade and a standard bolt is threaded into the barrel nut from outside the blade.
ISSUE:
Whether the instant fasteners are classified in subheading 7318.16.00, HTSUS, as “nuts”, or in subheading 7318.19.00, as other threaded fasteners.
LAW AND ANALYSIS:
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 for entries made on or after December 18, 2004. (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. 2704-17-103487 was properly accorded to protestant pursuant to 19 C.F.R. § 174.24(a) because the decision against which the protest was filed is alleged to be inconsistent with rulings of the Commissioner of Customs or his designee, or with a decision made by CBP with respect to the same or substantially similar merchandise, specifically Headquarters Ruling Letters (HQ) H195840, and HQ 959570, dated December 20, 2996, and New York Ruling Letters (NY) F84682, dated March 24, 2000, NY 844719, dated September 13, 1989, NY N192135, dated November 23, 2011, and NY N167096, dated June 7, 2011.
Merchandise is classifiable under the HTSUS in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that classification shall be determined according to the terms of the headings and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings or notes do not require otherwise, the remaining GRIs 2 through 6 may be applied.
GRI 6 states that the classification of goods in the subheading of a heading shall be determined according to the terms of those subheadings and any related subheading notes, and mutatis mutandis to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter, and subchapter notes also apply, unless the context otherwise requires.
The HTSUS provisions under consideration are as follows:
7318: Screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins,
washers (including spring washers) and similar articles, of iron or steel: Threaded articles: 7318.16.00 Nuts… 7318.19.00 Other…
* * * *
In understanding the language of the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System, constitute the official interpretation of the Harmonized System at the international level. While neither legally binding not 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 Explanatory Note to heading 73.18 provides, in pertinent part, as follows:
Nuts are metal pieces designed to hold the corresponding bolts in place. They are usually tapped throughout but are sometimes blind. The heading includes wing nuts, butterfly nuts, etc. Lock nuts (usually thinner and castellated) are sometimes used with bolts.
* * * *
The instant merchandise was liquidated in subheading 7318.19, HTSUS, as an “other” threaded fastener of heading 7318, HTSUS, based on the function of the nut as an insert, serving as a stationary, threaded receptacle for a bolt as opposed to being torqued onto a bolt in order to effectively clamp a material in between the bolt and the nut. The Protestant argues that the barrel nuts are properly classified in subheading 7318.16, as nuts, because they are internally threaded fasteners used in conjunction with a bolt to fasten materials together, and that the subject nuts cannot be “threaded inserts” as described by Customs because they lack external threading.
Subheading 7318.16.00, HTSUS, which provides for “nuts” is an eo nomine
provision. “An eo nomine designation with no terms of limitation, will ordinarily include all forms of the named article.” Carl Zeiss, Inc. v. United States, 195 F.3d 1375, 1379 (Fed. Cir. 1999). That said, “[w]hen an object is in character or function something other than as described by a specific statutory provision – either more limited or more diversified – and the difference is significant, it cannot find classification within such [eo nomine] provision.” Casio, Inc. v. United States, 73 F.3d 1095, 1097 (Fed. Cir. 1996), citing Robert Bosch Corp. v. United States, 63 Cust. Ct. 96, 103-04, Cust. Dec. 3881 (1969). Similarly, while an eo nomine provision is not governed by use, the use of the article may be a factor in determining whether it falls within the scope of an eo nomine provision if the name itself inherently suggests a type of use. See e.g., United States v. Quon Quon Co., 46 C.C.P.A. 70, 72-73 (1959).
The term “nut” is not defined by the tariff. The courts have held that in
determining the proper meaning of a tariff provision, “the correct meaning of the term is its common commercial meaning.” Arko Foods Int’l, Inc. v. United States, 654 F.3d 1361, 1364 (Fed. Cir. 2011). To determine the common commercial meaning Customs may rely upon “its own understanding of terms used, and may consult standard lexicographic and scientific authorities.” Rocknel Fastener, Inc. v. United States, 267 F.3d 1354, 1356-57 (Fed. Cir. 2001).
The CBP Informed Compliance Publication entitled, “What Every Member of the Trade Community Should Know About: Fasteners of Heading 7318”, defines “nuts” as “internally threaded fasteners designed to hold the corresponding bolt in place.” “Nuts” are similarly defined by various commercial standards, such as the ANSI/ASME’s Glossary of Terms for Mechanical Fasteners (ASME B18.12-2012), subsection 3.2.1.1., which defines a nut as: “a perforated block having an internal or female screw thread, designed to assemble with an external or male screw thread, such as those on a bolt or other threaded part. Its intended function is fastening, adjusting transmitting motion, or transmitting power with a large mechanical advantage and nonreversible motion.”
Thus a nut is defined broadly as a type of fastener which is internally threaded and often used opposite a mating bolt, holding the bolt in place and thus fastening the materials together. There does not appear to be a requirement that a nut must be torqued onto the mating bolt.
In the instant case, the subject barrel nuts have characteristics that differ from
the most common types of nut; for example, the common hex nut is generally fastened onto a stationary bolt, screw, or other threaded fastener, essentially functioning as a clamp for the interlaying material. Here, the subject barrel nuts are placed into a pre-drilled hole in the fastened material, providing a threaded receptacle for the bolt. As it is not torqued onto a bolt, its function diverges from that of many common types of nuts.
However, the article still fits within the broader definition of “nuts” outlined above; it is an internally threaded fastener, assembled with the thread of a mating bolt to fasten materials together. CBP has further classified similar articles with additional or divergent characteristics from those of “hex” and similar nuts in subheading 7318.16, HTSUS. See e.g., HQ H195840, on “rivet nuts”, in which CBP concluded that similar internally threaded inserts designed as a threaded receptacle for a bolt or a screw fell within the scope of subheading 7318.16, HTSUS. Similarly, in NY 844719, CBP determined that a “floating plate nut” and a “nonfloating multi-component nut” were classified as nuts of subheading 7318.16, HTSUS. Both nuts were combined with a steel base, which had two rivet holes to fix the nut in place. The plate nuts and multicomponent nuts were thus similarly serving as a stationary threaded receptacle for a screw instead of clamping onto a bolt or screw.
Pursuant to the above analysis, even if the instant barrel nuts could also be considered threaded inserts, they meet the terms of subheading 7318.16 and are classified therein.
HOLDING:
The instant barrel nuts are classified in heading 7318, specifically subheading 7318.16.00, HTSUS, which provides for “Screws, bolts, nuts, coach screws, screw hooks, rivets, cotters, cotter pins, washers (including spring washers) and similar articles, of iron or steel: Nuts.” The 2017 column one, general rate of duty is Free.
You are instructed to allow the protest.
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 online 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