CLA-2 RR:CR:GC 962307 AML
TARIFF No.: 8205.59.5560
Mr. Jeff Green
V.P. of Operations
M. Green Co.
3375 Homestead Road #10
Santa Clara, CA 95051
RE: Base metal setting tool for drop-in anchors
Dear Mr. Green:
This is in reference to New York Ruling Letters (NY) A89247 and A89248, both dated November 12, 1996, which classified, among other articles, a steel setting tool for drop-in anchors under subheading 7326.90.8585 of the Harmonized Tariff Schedule of the United States (HTSUS), which provides for other articles of iron or steel: other. We have reconsidered NY A89247 and A89248 and now believe that the classification of the base metal setting tool for the drop-in anchors is incorrect. This letter sets forth the correct classification of the setting tool. The classification of the other articles in the respective rulings remains the same.
Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625 (c)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057), a notice was published on March 7, 2001, in Vol. 35, No. 10 of the Customs Bulletin, proposing to modify NY A89247 and A89248 and to revoke the treatment pertaining to the steel setting tool. As explained in a notice published on February 21, 2001, in Vol. 35, No. 8 of the Customs Bulletin, the period within which to submit comments on this proposal was extended to March 23, 2001. No comments were received in response to these notices.
FACTS:
The setting tool was described in NY A89247 as follows:
[T]he setting tool, is a two-section dowel composed of steel, approximately 4 1/2 inches in length. The dowel is approximately 3/8 of
an inch in diameter for most of its length. The last 5/8 inches of the dowel is 1/8 inch in diameter. The tool operates by inserting the narrow end into the chamber of the anchor and then the anchor is driven into a pre-made hole by hammering on the end of the tool.
The setting tool was described in NY A89248 as follows:
Setting Tool for 1/4" Caulking Machine Screw Anchor - made of steel for use in installing anchors, drop-ins, etc. The setting tool is actually hammered to facilitate the installation.
Although you did not clarify within your original request whether the
setting tool was going to be packaged together with the anchors, sales literature submitted with the original requests indicates that there will be one setting tool packaged with every 100 anchors.
ISSUE:
Whether the steel setting tool for drop-in anchors is classifiable under subheading 7326.90.8585, HTSUS, which provides for other articles of iron or steel, other; or under subheading 8205.59.5560, HTSUS, which provides for other iron or steel handtool[s] not elsewhere specified or included, other?
LAW and ANALYSIS:
The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation (GRIs). GRI 1, HTSUS, provides, in part, that “for legal purposes, classification shall be determined according to terms of the headings and any relative section or chapter notes[.]”
The HTSUS headings and subheadings under consideration are as follows:
7326 Other articles of iron or steel:
Forged or stamped, but not further worked:
7326.90 Other:
7326.90.85 Other.
* * *
8205 Handtools (including glass cutters) not elsewhere specified or included; blow torches and
similar self- contained torches; vises, clamps and the like, other than accessories for and
parts of machine tools; anvils; portable forges; hand- or pedal-operated grinding wheels with
frameworks; base metal parts thereof:
Other handtools (including glass cutters) and parts thereof:
8205.59 Other:
8205.59.55 Other:
8205.59.55.60 Other (including parts).
Customs is satisfied that the drop-in anchors in each of the above-mentioned
rulings are properly classified. However, the setting tool for the drop-in anchors was not properly classified in those rulings. The classification of the setting tool will depend on its condition as imported, i.e., whether it is imported with the fasteners with which it will be used or whether it is imported separately from any other articles.
When interpreting and implementing the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS. Customs believes the ENs should always be consulted. See, T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The ENs to heading 7326, HTSUS, provide, in pertinent part, that:
This heading covers all iron or steel articles obtained by forging or punching, by cutting or stamping or by other processes such as folding, assembling, welding, turning, milling or perforating other than articles included in the preceding headings of this Chapter or covered by Note 1 to Section XV or included in Chapter 82 or 83 or more specifically covered elsewhere in the Nomenclature.
The General ENs to Chapter 82 provide, in pertinent part, that:
This Chapter includes:
(A) Tools which, apart from certain specified exceptions (e.g., blades for machine saws), are used in the hand (headings 82.01 to 82.05).
(B) Tools of two or more of the headings 82.02 to 82.05, put up in sets for retail sale (heading 82.06).
The ENs to heading 8205, HTSUS, provide, in pertinent part, that:
This heading covers all hand tools not included in other headings of this Chapter or elsewhere in the Nomenclature[.]
It includes a large number of hand tools (including some with simple hand-operated mechanisms such as cranks, ratchets or gearing). This group of tools includes:
* * *
(E) Other hand tools (including glaziers' diamonds).
This group includes:
* * *
(7) Miscellaneous hand tools such as . . . cold chisels and punches . . ..
Although the term "tool" is not defined in the HTSUS, it is presumed that Congress intended to apply its common and commercial meaning. Brookside Veneers, LTD v. United States, 847 F. 2d 789 (1988). To ascertain the common and commercial meaning of a term, dictionaries and other lexicographic authorities may be consulted.
Austin Chem. Co. v. United States, 835 F. 2d 1423 (Fed. Cir. 1987). A “tool” is described as "[a] hand-held implement, as a hammer, saw, or drill, used in accomplishing work." Webster's II New Riverside University Dictionary, p. 1217 (1984). The subject setting tool satisfies this description. It is a hand-held implement used to accomplish the work of setting drop–in anchors; that is, the setting tools are held in the hand and struck with a hammer in order to secure the anchor bolts in masonry or other hard, durable surface.
Imported separately from any other articles, the setting tool, comprised of base metal and designed to be used by hand, is prima facie classifiable at GRI 1 under heading 8205, HTSUS, which provides for other handtools not elsewhere specified or included, specifically at subheading 8205.59.55. The setting tool is not more specifically provided for elsewhere in the HTSUS, and it is more aptly described as a tool than as an other article of metal.
When the setting tools are imported with the drop-in anchors, the analysis changes. GRI 2(b) provides that the classification of goods consisting of more than one material or substance shall be according to the principles of [GRI] 3. GRI 3 provides in pertinent part that composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
In those instances in which the setting tools are imported with the drop-in
anchors with which they will be used, Customs would consider the articles to be a set as contemplated by GRI 3(b). See, generally, the Informed Compliance Publication (ICP) entitled “What Every Member of the Trade Community Should Know About: Classification of Sets under the HTS” (September, 1999) and EN X to GRI 3(b):
For the purposes of this Rule, the term “goods put up in sets for retail sale” shall be taken to mean goods which:
(a) consist of at least two different articles which are, prima facie classifiable in different headings;
(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and
(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).
The setting tool is provided with 100 anchors. The two distinct articles make up a set put up for retail sale for purposes of GRI 3(b). That is, they are, prima facie,
classifiable in different headings (see above), they are put together to meet a particular need or carry out a specific activity (that of setting the drop in anchors so the anchors can perform their intended function), and they are put up in a manner suitable for sale directly to users without repacking. Pursuant to GRI 3(b), classification of the set is determined on the basis of the component that imparts the essential character to the whole. EN Rule 3(b)(VII) lists as factors to help determine the essential character of such goods the nature of the materials or components, their bulk, quantity, weight or value, and the role of the constituent materials or components in relation to the use of the goods.
Recently, there have been several decisions on “essential character” for purposes of GRI 3(b). These cases have looked primarily to the role of the constituent materials or components in relation to the use of the goods to determine essential character. Better Home Plastics Corp. v. United States, 916 F. Supp. 1265 (CIT 1996), affirmed, 119 F. 3rd 969 (Fed. Cir. 1997); Mita Copystar America, Inc. v. United States, 966 F. Supp. 1245 (CIT 1997), motion for rehearing and reconsideration denied, 994 F. Supp. 393 (CIT 1998), and Vista International Packaging Co. v. United States, 19 CIT 868, 890 F. Supp. 1095 (1995). See also, Pillowtex Corp. v. United States, 983 F. Supp. 188 (CIT 1997), affirmed, 171 F.3d 1370 (Fed. Cir. 1999).
Based on the foregoing, we conclude that in an essential character analysis for purposes of GRI 3(b), the role of the constituent materials or components in relation to the use of the goods is generally of primary importance, but the other factors in EN Rule 3(b)(VII) should also be considered, as applicable. In this case, the “indispensable function” (Better Home Plastics, supra) of the drop-in anchors is to “hold” or “hang” another article. Clearly, the drop-in anchors perform this function, with the setting tool performing the subsidiary function of securing the anchors. Accordingly, we conclude that the drop-in anchors impart the essential character of the set. When packaged for retail sale and imported as a set, the classification of the set would be under subheading 7318.19.00 for the steel anchors in NY A89247 and under subheading 7907.00.60, HTSUS, for the zinc alloy anchors in NY A89248.
The determination that the base metal setting tools are classifiable under heading 8205, HTSUS, comports with prior rulings of this office. In New York Ruling Letter (NY) D88844, dated March 10, 1999, a similar setting tool was classified under subheading 8205.59.55, HTSUS, which provides for other hand tools.
HOLDING:
The base metal hand tools for setting drop-in anchors are classifiable as follows:
If imported separately from any other article, the base metal hand tools are
classifiable under subheading 8205.59.5560, HTSUS, which provides for other handtools not elsewhere specified or included, other.
If imported with the respective fasteners, it is our determination that, in accordance with GRI 3, the articles will be considered to be ancillary to the fasteners (which impart the essential character to the importation) and classified with the fasteners.
EFFECT ON OTHER RULINGS:
NY A89247 and A89248 are hereby MODIFIED, only as they apply to the classification of the setting tools.
Sincerely,
John Durant, Director
Commercial Rulings Division