CLA-2 CO:R:C:M 951569 DWS
District Director
U.S. Customs Service
610 South Canal Street
Chicago, IL 60607
RE: Internal Advice 18/92; Furnace; Die Casting Machine;
C.S.D. 83-83; Functional Unit; Section XVI, Note 4;
Section XVI, Note 2(a)
Dear Sir:
This is in response to your memorandum requesting internal
advice concerning the tariff classification of a die casting
machine, imported in two different shipments, under the
Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The subject merchandise consists of a die casting machine.
The importer placed an order with its parent-supplier for a
complete die casting machine. However, the furnace for the
machine, shipped the same day as the remainder of the machine,
was laden on a different vessel. The furnace arrived in Chicago,
Illinois, on December 14, 1991, while the remainder of the die
casting machine arrived in Newark, New Jersey, on December 17,
1991.
ISSUE:
Whether, for classification purposes, the furnace and the
remainder of the die casting machine, imported in separate
shipments, make up a functional unit classifiable as a casting
machine under the HTSUS?
LAW AND ANALYSIS:
Classification of merchandise under the HTSUS is in
accordance with the General Rules of Interpretation (GRI's),
taken in order. GRI 1 provides that classification is determined
according to the terms of the headings and any relative section
or chapter notes.
The die casting machine without the furnace was classified
by the Newark port under subheading 8454.30.00, HTSUS, which
provides for: "[c]onverters, ladles, ingot molds and casting
machines, of a kind used in metallurgy or in metal foundries, and
parts thereof: [c]asting machines." However, the furnace was
classified by the Chicago port under subheading 8514.30.00,
HTSUS, which provides for: "[i]ndustrial or laboratory electric
furnaces and ovens; other industrial or laboratory induction or
dielectric heating equipment; parts thereof: [o]ther furnaces and
ovens."
Section XVI, note 4, HTSUS, states that:
[w]here a machine (including a combination of machines)
consists of individual components (whether separate or
interconnected by piping, by transmission devices, by
electric cables or by other devices) intended to contribute
together to a clearly defined function covered by one of the
headings in chapter 84 or chapter 85, then the whole falls
to be classified in the heading appropriate to that
function.
The importer claims that, under section XVI, note 4, HTSUS,
the furnace should be classifiable as a functional unit with the
die casting machine because the entire machine, including the
furnace, was the subject of one order, and that all of the
components will be assembled into one unit after importation.
In C.S.D. 83-83, dated April 5, 1988, the tariff
classification of a hoverbarge, imported in a disassembled state
over a period of five days, was at issue. The hovercraft was cut
into eleven sections, and these sections were loaded onto ten
trucks. The ten trucks were to travel in convoy at the same time
and enter at the port of Alcan, Alaska. However, one truck broke
down and another stayed behind. The first eight trucks arrived
at Alcan on January 21, 1981, and the two remaining trucks
reached Alcan on January 26, 1981.
In C.S.D. 83-83, it was held that:
a hoverbarge imported into the United States in
disassembled sections does not meet the requirements of a
vessel. Subassemblies or components may form a vessel when
assembled, however they are not considered to be a vessel
when imported into the United States because at the
time of importation it is the condition of the structure
that controls its classification and not what the structure
is made into after importation. Sections of the hoverbarge
are considered merchandise and are dutiable under the
appropriate tariff schedules.
The facts in C.S.D 83-83 and in the present situation are
very similar. As with the merchandise in C.S.D. 83-83, it is the
condition of the die casting machine and furnace at the time of
importation that governs, not what they will be made into after
importation. Unlike the merchandise in C.S.D. 83-83, which
arrived at the same port, the furnace and the remainder of the
die casting machine arrived at two separate ports, hundreds of
miles apart. It is our position that, based upon the reasoning
in C.S.D. 83-83, the subject merchandise does not make up a
functional unit.
Section XVI, note 2(a), HTSUS, states that:
[p]arts which are goods included in any of the headings of
chapters 84 and 85 (other than headings 8485 and 8548) are
in all cases to be classified in their respective headings.
The furnace, which is a part of the subject die casting
machine, is specifically provided for under subheading
8514.30.00, HTSUS. Therefore, under section XVI, note 2(a),
HTSUS, the furnace is classifiable under subheading 8514.30.00,
HTSUS.
HOLDING:
Under C.S.D 83-83, for classification purposes, the furnace
and the remainder of the die casting machine do not make up a
functional unit.
The furnace is classifiable under subheading 8514.30.00,
HTSUS. The general, column one rate of duty is 2.5 percent ad
valorem.
The remainder of the die casting machine is classifiable
under subheading 8454.30.00, HTSUS. Under this provision, the
merchandise is subject to a free rate of duty.
You should advise the internal advice applicant of this
decision.
Sincerely,
John Durant, Director
Commercial Rulings Division