CLA-2 CO:R:C:G 087076 JMH
Mr. P. Kimball
Valve & Filter Corporation
8041 West 1-70 Frontage Road, #9
Arvada, Colorado 80002
RE: Reconsideration of Headquarters Ruling Letter 086211, dated
March 24, 1990; butterfly valves
Dear Mr. Kimball:
This is in response to your April 6, 1990 letter requesting
the reconsideration of Headquarters Ruling Letter 086211 ("HQ
086211"), dated March 24, 1990.
FACTS:
The articles in question are rubber encapsulated iron
butterfly valves to be imported from France. The valves are to
be used in agricultural irrigation systems. The items are
manually operated only by a hand lever. The butterfly valves are
in sizes of two inches, two and a half inches, three inches, four
inches, six inches and eight inches.
HQ 086211 classified the butterfly valves within subheading
8481.80.30, Harmonized Tariff Schedule of the United States
Annotated ("HTSUSA"), as "Taps, cocks, valves and similar
appliances...including pressure-reducing valves and
thermostatically controlled valves..." However, HQ 086211
determined that the butterfly valves are "parts" of an
agricultural irrigation system and "parts" are not provided for
within heading 9817.00.50, HTSUSA. Heading 9817.00.50 describes
"Machinery, equipment and implements to be used for agricultural
or horticultural purposes." Therefore, the butterfly valves were
denied duty free treatment under heading 9817.00.50.
You do not contest the classification of the valves within
subheading 8481.80.30. You dispute the denial of duty free
treatment under heading 9871.00.50.
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ISSUE:
Whether the butterfly valves qualify for the special
agricultural use duty exemption of heading 9817.00.50.
LAW AND ANALYSIS:
As stated in HQ 086211, the classification of merchandise
under the HTSUSA is governed by the General Rules of
Interpretation (GRI's). GRI 1, HTSUSA, requires that before an
item may be classified under a heading, that item must first meet
the terms of the heading.
The heading in question, heading 9817.00.50, provides duty
free treatment to "Machinery, equipment and implements to be used
for agricultural or horticultural purposes." HQ 086211 provided
definitions for the terms "machinery", "equipment" and
"implement". In turn, you have provided your own definitions.
The definitions quoted in HQ 086211 were meant to be instructive,
not determinative of the issue.
The determinative factor in this classification is the
intent of Congress. When Congress enacted the HTSUSA, two
provisions were included that gave special treatment to articles
used for agricultural and horticultural purposes. Heading
9817.00.50 is one of the provisions. The other provision is
heading 9817.00.60, HTSUSA. Heading 9817.00.60 describes the
following:
Parts to be used in articles provided for in headings
8432, 8433, 8434 and 8436, whether or not such parts
are principally used as parts of such articles and
whether or not covered by a specific provision within
the meaning of additional U.S. rule of interpretation
1(c)... (emphasis added)
Headings 8432, 8433, 8434 and 8436 refer to specific types of
agricultural and horticultural machinery.
This specificity of parts within heading 9817.00.60
establishes that Congress considered the issue of parts of
machinery. Since heading 9817.00.50 has no reference to parts it
appears that Congress did not intend for all items used as a part
of agricultural or horticultural equipment to receive duty free
treatment.
The test promulgated in HQ 086211 for the determination of
when an item is "machinery, equipment, and implements" under
heading 9817.00.50, addresses the terms of the heading. We do
not find it flawed. Three steps must be met. They are:
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(1) The article in question must not be excluded from
the heading under Section XXII, Chapter 98,
Subchapter XVII, U.S. Note 2, HTSUSA.
(2) The article to be classified must be the article
that performs the agricultural or horticultural
pursuit in question. If the article only performs
a portion of that pursuit, it is a part, not
machinery, equipment or an implement within the
heading.
(3) The article must have the actual use certification
required under 10 C.F.R. 10.138.
The butterfly valves are classified within subheading
8481.80.30. Subheading 8481.80.30 is not excluded from
classification within heading 9817.00.50 by Section XXII, Chapter
98, Subchapter XVII, U.S. Note 2(t). The first prerequisite is
met.
You state that the valves are to be used in irrigation
systems. The valves, by themselves, do not perform irrigation.
They are parts of a larger irrigation system. Although the
valves are used in agricultural and horticultural pursuits, they
are only parts used in such a pursuit. "Parts" are not included
within heading 9817.00.50. This office does not have the
authority to rewrite legislation enacted by Congress. Therefore,
the butterfly valves are denied the duty exemption.
HOLDING:
The butterfly valves imported from France are parts of an
irrigation system, used for agricultural or horticultural
purposes. "Parts" are not included within heading 9817.00.50.
Therefore, the butterfly valves are denied the duty exemption
provided under heading 9817.00.50.
Sincerely,
John Durant, Director
Commercial Rulings Division