CLA-2 CO:R:CV:G: 083081 JLV
John B. Rehm, Esq.
Dorsey & Whitney
1330 Connecticut Avenue, N.W.
Suite 200
Washington, D.C. 20036
RE: Classification of multipurpose motor vehicles; revocation
of decision issued on January 4, 1989 (file 083081)
Dear Mr. Rehm:
In a letter of November 21, 1988, on behalf of your
client American Suzuki Motor Corporation (Suzuki), you
requested a ruling on the tariff classification of the Suzuki
Samurai (Samurai) and Suzuki YOE, Y2R, and YOR (collectively
YOE) motor vehicles under the Harmonized Tariff Schedule of
the United States (HTSUS). On January 4, 1989 (file 083081),
we ruled that these multipurpose vehicles were classified in
subheading 8704.31.00, Harmonized Tariff Schedule of the
United States (HTSUS).
This decision revokes and supersedes our earlier
decision. The facts are repeated and rationale follow.
FACTS:
The Samurai was the subject of several rulings issued
under the Tariff Schedules of the United States (TSUS), the
most recent ruling of which was dated March 24, 1988 (file
081443); the YOE was classified under the TSUS in a ruling
dated May 27, 1988 (file 082254). The facts presented in both
those cases have not changed.
These vehicles were classified as automobile trucks in
item 692.02, TSUS, or as other motor vehicles for the
transport of persons or articles in item 692.10, TSUS,
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depending on whether or not, in their condition as imported,
they contained rear seats or passenger "amenities" in the rear
area which impaired the cargo-carrying nature of the rear
area. These criteria were traditional criteria used by
Customs in classifying such vehicles under the TSUS.
The YOE was described in our ruling of May 27, 1988 (file
082254), as either a hardtop or a softtop. Either version was
to be capable of two-wheel or four-wheel drive in either a low
or high range manually selected by engaging a multi-range
transfer case.
You identified the following features as relevant to
classification of the vehicle as an automobile truck in item
692.02, Tariff Schedules of the United States (TSUS):
1. Truck-type chassis: separate frame
2. Rear door (hardtop) or rear gate (softtop) that is
hinged on one side and swings wide open for cargo
3. Ridged floor design to support cargo weight
4. Drainage holes in floor for cargo spills
5. Rear floor approximately flush with rear bumper to
permit easy loading and unloading
6. Height of rear floor for ease of loading
7. Spare tire mounted on rear door and away from cargo
area
8. Side-opening windows in rear to vent odors from
noxious cargo
Other features on the vehicle as imported consisted of
the following:
9. Vents under front seats for heat or air
conditioning, but no controls in rear
10. Threaded and recessed fasteners at specific
locations in the rear deck area and side panels for
installation of optional equipment, such as rear
bench seat, seatbelts, and rear assist grips.
The dimensions and cargo capacity of the vehicle, in this
condition as imported, were stated to be as follows: the
hardtop and softtop measure approximately 3,620 mm in length,
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1,630 mm in width, and 1,685 mm in height; the hardtop has a
cargo volume capacity of approximately 38.5 to 39.1 cubic
feet; the softtop has a cargo capacity of approximately 39.1
to 39.2 cubic feet; the payload weight capacity of the hardtop
and softtop ranges from 860 to 1003 and 893 to 1069,
respectively (slightly higher than the Samurai).
The same vehicle, however, could also be imported with
rear seating and with accessories described as "passenger
amenities" consisting of side trim, carpeting, ashtrays,
headliner, and other items for the comfort and use of
passengers seated behind the driver's area.
The dimensions of the rear cargo area were said to be
similar to that of the Suzuki Samurai, as were the other
features. Therefore, we will not repeat the description of
various features of the Samurai which was set forth in our
rulings of March 24, 1988, (file 081443) and July 22, 1984
(file 809545).
Both vehicles are "two-door" vehicles with a rear door
that swings out. Access to the rear seat, in those models
having a rear seat, is through one of the two front doors and
by folding a front seat forward.
You state that the Samurai and the YOE should be
classified as a motor vehicle for the transport of goods in
heading 8704, HTSUS, if imported without rear seats and other
accessories or items in the rear area. However, you also
state that, if imported with rear seats or other options in
the rear area that impede the loading, transport, and
unloading of goods, the Samurai and the YOE should be
classified as a motor vehicle principally designed for the
transport of persons in heading 8703, HTSUS.
The advertising literature describes the Samurai as
follows: "think of it as the handy small delivery truck[;]"
"sturdy truck chassis and frame[;]" "[y]ou can fill the
Samurai with friends, or load it with cargo[;]" "[f]or more
room, the back seat folds forward, or is easily removed[;]" or
"and we even have a Samurai in a truck version, which has no
back seat and over 18 cubic feet of rear cargo space." This
language identifies the Samurai (and the YOE) as a multi-
purpose vehicle, even when a rear seat has been installed.
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ISSUE:
If imported without rear seats, are the Suzuki vehicles
"motor vehicles for the transport of goods" within heading
8704, HTSUS? If so, and if seats and other appointments have
been installed behind the driver and front passenger seats
prior to importation, then are these same vehicles more
properly within heading 8703, HTSUS, as "motor vehicles
principally designed for the transport of persons?"
LAW AND ANALYSIS:
Classification under the HTSUS is governed by the General
Rules of Interpretation (GRI). GRI 1 is as follows:
1. * * * for legal purposes, classification shall be
determined according to the terms of the headings
and any relative section or chapter notes and,
provided such headings or notes do not otherwise
require, according to the following provisions * *
*
The relevant headings in this case are as follows:
8703 Motor cars and other motor vehicles principally
designed for the transport of persons (other than
those of heading 8702), including station wagons
and racing cars: * * *
8704 Motor vehicles for the transport of goods: * * *
There are no relevant legal notes in section XVII or chapter
87 which address these headings for our purposes in this
ruling.
By the express language of heading 8703, motor vehicles
must be "principally designed" for the transport of persons in
order to be classified within that heading. Certain types of
motor vehicles which are capable of off-the-road uses, such as
the Suzuki 4x4 utility vehicles, are usually constructed on a
truck chassis. These vehicles have been described as
"multipurpose" or "sport utility" vehicles. The bodies of
these vehicles may vary in style and utility, and, for
purposes of this ruling, may have design features which permit
both the transport of goods and people.
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The design of the body on the Suzuki 4x4 vehicles is
utilitarian and allows the easy loading, transportation, and
unloading of goods: swing out rear door; flat floor and rear
loading deck; and relatively high roof for the size and weight
rating of the vehicle. These structural design features are
consistent with a vehicle designed for the transport of goods
because they provide a readily accessible and usable cargo
space, together with a chassis and suspension that permits a
cargo payload which is approximately 20 percent of the gross
vehicle weight rating. The percentage of payload gross for
small pickup trucks, for example, is normally from 15 percent
to 25 percent of the gross vehicle weight.
The addition of auxiliary design features which adapt the
vehicle to additional uses are evidence only of the fact that
the vehicle, at this point, is a multipurpose vehicle. To the
extent that a change does not significantly alter the basic
structural design, there is insufficient evidence that the
changes result in a vehicle "principally" designed for another
purpose, such as the transport of persons. In this light, we
view the addition of interior trim packages, carpeting, and
removable or folding rear seats in the two-door Suzuki
vehicles as insufficient to establish that transporting
persons was the principal design criterion. These auxiliary
design features do not, of themselves, effect an alteration of
the fundamental structural design of a vehicle as a vehicle
for the transport of goods.
Motor vehicles classified in heading 8703 are vehicles
"principally designed for the transport of persons." In this
case, the two-door Suzuki vehicles have all the structural
features of a vehicle designed for the transport of goods.
The addition of auxiliary features, such as the type of
seating and the additional trim packages, are not a
significant alteration to the goods-carrying structure so as
to require a conclusion that they are principally designed for
the transport of persons.
No single factor dictates whether a vehicle is
principally designed for the transport of persons. In this
case, the chassis and suspension, the body style, the payload
capacity (by weight) in relation to the gross vehicle weight,
and the relatively minor effect of the rear seating on the
basic goods-carrying structural design of the Suzuki vehicles
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indicate that these are multipurpose vehicles for the
transport of goods and persons, and that the transport of
persons is not the "principal design" of the vehicle.
HOLDING:
If imported with spark-ignition internal combustion
piston engines, the two-door Suzuki Samurai and YOE, Y2R, and
YOR, described above and imported with or without rear seats
and rear trim, are classified as motor vehicles for the
transport of goods, other, G.V.W. not exceeding 5 metric tons,
in subheading 8704.31.00, HTSUS, dutiable at 25 percent ad
valorem pursuant to subheading 9903.87.00.
This decision supersedes our decision of January 4, 1989,
as modified by letters of January 17, 1989, and February 10,
1989 (file 083081).
This decision applies to all such vehicles imported on or
after January 1, 1989.
Sincerely,
John Durant, Director
Commercial Rulings Division
6cc: AD, NY Seaport
2cc: Chief, CIE
1cc: Each Regional Commissioner
1cc: Director, Trade Operations
1cc: NIS 101: Mr. Sheldon Hantman, New York Seaport
1cc: Reading File
1cc: AC, Commercial Operations