HQ 955502
MARCH 31 1994
CLA-2:CO:R:C:M 955502 JAS
Mr. L.J. Stout
Massey-Ferguson Industrial Machinery, Inc.
1750 Belle Meade Court, Suite C
Lawrenceville, GA 30243
RE: Backhoe-Loaders, MF Models 750, 860, 965; Tractors
Suitable for Agricultural Use, Heading 8701; Chapter 87,
Note 2, HQ 951434; Shovel Loaders, Backhoes, Composite
Machines, Heading 8429, Section XVI, Note 3; HQ 953136
Dear Mr. Stout:
In your letter of December 1, 1993, you inquire as to the
tariff classification of the Massey-Ferguson (MF) vehicle models
750, 860 and 965 from the UK, which you refer to as industrial
tractor-backhoe-loaders. Brochures were submitted.
FACTS:
You identify the vehicles in issue as tractor-backhoe-
loaders. However, literature depicting the MF models 750, 860
and 965 identifies them as backhoe loaders for the construction
and building industries. All are wheeled vehicles with enclosed
cabs. Each has a front-mounted bucket and rear shovel operating
from an articulated boom incorporated into a fully integrated
frame. This configuration apparently dedicates them for
earthmoving and excavating purposes. All are 9 ft. 1 in. high at
the cab, 7ft. 10 in. wide, and weigh between 15,913 and 17,191
lbs. The three models have either 4 or 5 speed all wheel
transmissions, forward and reverse speeds, and are powered by 4
cylinder turbocharged engines generating from 78 to 90 hp.
You maintain that the models 750 and 860 directly replace
the MF models 50H and 50HX which Customs previously classified
free of duty as tractors suitable for agricultural use, in
subheading 8701.90.10, Harmonized Tariff Schedule of the United
States (HTSUS). HQ 951434, dated June 23, 1992. That ruling
classified the MF 60HX, now the model 965, under subheading
8701.90.50, HTSUS, a provision for other tractors. You state the
new models represent improvements over the previous models that - 2 -
constitute only commercial enhancements, to promote salability
and to stay current with the technology relating to engine and
tool working performance, and that the basic tractor base and
overall capabilities, as well as the scope of use, remain the
same.
The provisions under consideration are as follows:
8429 Self-propelled bulldozers, angledozers,
graders, levelers, scrapers, mechanical
shovels, excavators, shovel loaders,
tamping machines and road rollers:
8429.51 Front-end shovel loaders:
8429.51.10 Wheel-type...2 percent
8429.59 Other:
8429.59.10 Backhoes, shovels, clamshells and draglines
...2 percent
8429.59.50 Other...2.5 percent
* * * * *
8701 Tractors (other than tractors of heading
8709):
8701.90 Other:
8701.90.10 Suitable for agricultural use...Free
8701.90.50 Other...2.2 percent
ISSUE:
Whether the MF model 750, 860 and 965 wheeled vehicles are
tractors; if they are, whether they are suitable for agricultural
use.
LAW AND ANALYSIS:
Merchandise is classifiable under the Harmonized Tariff
Schedule of the United States (HTSUS) in accordance with the
General Rules of Interpretation (GRIs). GRI 1 states in part
that for legal purposes, classification shall be determined
according to the terms of the headings and any relative section
or chapter notes, and provided the headings or notes do not
require otherwise, according to GRIs 2 through 6. - 3 -
Initially, articles of section XVII are excluded from
section XVI. Section XVI, Note 1(l), HTSUS. Therefore, if the
MF wheeled vehicles in issue here are tractors of heading 8701
they cannot be classified in heading 8429.
For purposes of chapter 87, the term "tractors" means
vehicles constructed essentially for hauling or pushing another
vehicle, appliance or load, whether or not they contain
subsidiary provision for the transport, in connection with the
main use of the tractor, of tools, seeds, fertilizers or other
goods. Chapter 87, Note 2, HTSUS.
The Harmonized Commodity Description And Coding System
Explanatory Notes (ENs) constitute the Customs Cooperation
Council's official interpretation of the Harmonized System.
While not legally binding on the contracting parties, and
therefore not dispositive, the ENs provide a commentary on the
scope of each heading of the Harmonized System and are thus
useful in ascertaining the classification of merchandise under
the System. Customs believes the notes should always be
consulted. See T.D. 89-80.
Relevant ENs at p. 1424, state that heading 87.01 does not
cover propelling bases specially designed, constructed or
reinforced to form an integral part of a machine performing a
function such as lifting, excavating, levelling, etc., even if
the propelling base uses traction or propulsion for the execution
of this function. The ENs continue on p. 1425, under the heading
TRACTORS FITTED WITH OTHER MACHINERY, "As a general rule,
propelling bases forming an integral part of a machine designed
for handling, excavating, etc., can be distinguished from the
tractors of [heading 87.01] by their special constructional
features (shape, chassis, means of locomotion, etc.). For
propelling bases of the tractor type, various technical features
relating essentially to the structure of the complete unit and to
equipment specially designed for functions other than hauling or
pushing should be taken into consideration. For instance, the
propelling bases not covered by [heading 87.01] incorporate
robust elements (such as supporting blocks, plates or beams,
platforms for swivelling cranes) forming a part of or fixed,
generally by welding, to the chassis-body framework to carry the
actuating equipment for the working tools."
The evidence of record indicates that the bucket loader and
rear mounted backhoe of the MF vehicles in issue are standard
equipment, incorporated into a fully integrated frame. It is
difficult to argue, therefore, that these vehicles are
constructed essentially for hauling or pushing. Under the
heading TRANSMISSION the literature describes a design for shock-
free transition of power, ensuring maximum traction and excellent
loader bucket penetration. Under the heading AXLES, the
literature describes a heavy duty final drive outboard planetary - 4 -
cast axle beam insuring maximum ground contact and traction,
which together with the 50 degree steer angle, achieves a tight
turning radius for overall maneuverability. These are design
characteristics common to graders and excavators, not tractors.
Under the heading HYDRAULICS the discussion relates entirely to
the loader/backhoe operation.
It is clear that these vehicles are designed to withstand
vertical stresses associated with digging and lifting, rather
than the horizontal or tractive stresses associated with pushing
or pulling. The specifications omit mention of PTOs or 3-point
hitch, features commonly associated with tractors. The described
characteristics, read in conjunction with the cited ENs to
heading 8701 that exclude from that heading propelling bases
specially designed or constructed to form an integral part of a
machine performing a function such as lifting, excavating,
leveling, etc., compel a finding that the MF vehicles in issue
are not "tractors" as that term is defined in the HTSUS. This
precludes the application of heading 8701.
Relevant ENs state that heading 8429 covers a number of
earth digging, excavating or compacting machines which are
explicitly cited in the heading and which have in common the fact
that they are self-propelled. Among those listed at (F) on p.
1202 are Self-propelled shovel loaders, wheeled or crawler
machines with front-mounted buckets which pick up material
through motion of the machine, transport and discharge it. Some
shovel-loaders are able to dig into the soil. This is achieved
as the bucket, when in the horizontal position, is capable of
being lowered below the level of the wheels or tracks. These ENs
describe the machines in issue.
Because these vehicles perform functions appropriate to
shovel loaders and to backhoes, they are composite machines.
Section XVI, Note 3, HTSUS. Such machines are to be classified
as if consisting of that component or as being that machine which
performs the principal function. In this instance, the evidence
of record does not establish a principal function. In such
cases, classification shall be in the provision which occurs last
in numerical order among those which equally merit consideration.
GRI 3(c), HTSUS. Applying Rule 3(c) at the subheading level, we
find that the MF vehicles in issue are provided for in subheading
8429.59. Customs routinely classifies wheel-type backhoe loaders
in subheading 8429.59.10. HQ 953136, dated February 5, 1993. - 5 -
HOLDING:
Under the authority of GRI 1, the MF vehicle models 750, 860
and 965 are provided for in heading 8429. They are classifiable
in the provision for backhoes, shovels, clamshells and draglines,
in subheading 8429.59.10, HTSUS.
Pursuant to section 625(c)(1) of Title VI (Customs
Modernization) of the North American Free Trade Agreement
Implementation Act (Pub. L. 103-182, 107 Stat. 2057), Customs
intends to modify HQ 951434, dated June 23, 1992, to reflect the
views expressed in this decision. Notice to interested parties
of this proposed modification will be published in the Customs
Bulletin. However, before modifying HQ 951434, Customs will
consider any written comments timely received.
Claims for detrimental reliance under section 177.9, Customs
Regulations (19 CFR 177.9), will not be entertained for actions
occurring on or after the date of publication of this notice.
Sincerely,
John Durant, Director
Commercial Rulings Division