CLA-2 RR:CR:GC 966789 RSD
TARIFF NO. 7318.15.80-55/65
Port Director
Customs and Border Protection
6747 Engle Road
Middleburg Heights, Ohio 44130
RE: Reconsideration of HQ 966412 affirmed; Oil Bolts Used for Motor Vehicles and Motorcycles
Dear Port Director:
This is in response to the request for reconsideration of HQ 966412, dated September 3, 2003, which concerned the classification under the Harmonized Tariff Schedule of the United States (HTSUS) of oil bolts used in motor vehicles and motorcycles. Counsel submitted a request for reconsideration of HQ 966412 on October 17, 2003, on behalf of Honda of America Mfg., Inc. (HAM). It was forwarded to the Office of Regulations & Rulings.
We have also received an application for further review (“AFR”) of protests that were filed in Birmingham, Alabama and Atlanta, Georgia on behalf of a related company, Honda Manufacturing of Alabama (HMA) also concerning oil bolts used in motor vehicles. On July 10, 2003, Customs & Border Protection (CBP) met with HMA’s counsel to discuss HMA’s protest claim. On January 23, 2004, HMA’s counsel notified our office that HMA agrees that for tariff classification purposes the oil bolts that HMA imported were substantially identical to the oil bolts that HAM imports. Accordingly, HMA indicated that it would be appropriate for its AFR and the tariff classification of its oil bolts to be based on HAM’s request for reconsideration of HQ 966412. Therefore, this decision is primarily based on HAM’s October 17, 2003, request for reconsideration. However, in this decision we will also consider the arguments that HMA’s counsel raised in its AFR of the protests that it has filed.
FACTS:
The subject parts at issue are described as a form of “oil bolts” used in automotive or motorcycle hydraulic brake, transmission, or clutch lines. Because this is a reconsideration of HQ 996412, the facts as set forth in HQ 966412 are incorporated in this decision by reference.
HMA‘s protests concern oil bolts that are used solely in braking systems of motor vehicles and are identical to those described in HQ 966412. According to HMA’s submissions, the subject merchandise is identified by one of three terms (1) oil bolt fitting; (2) banjo bolt fitting; or (3) pressure fitting. Regardless of the name chosen, the oil bolts that HMA uses are designed to provide for the unimpeded flow of brake fluid between a brake hose assembly and a motor vehicle braking system. Like the oil bolts that HAM imports, the oil bolts that HMA uses are threaded at one end and have a hex shaped head for torquing. These oil bolts are inserted through the banjo-type hose end of the brake hose assembly and are then threaded directly into the caliper. Aluminum crush washer seals are placed on the opposite side of the banjo-type hose end.
HMA points out that an essential design feature of the oil bolts is their internal bore, which connects to two exit holes on opposite sides just below their heads. This allows for the flow of brake fluid from the brake hose assembly into the caliper. Importantly, the motor vehicle brake system would not be functional in the absence of the oil bolts allowing the passage of brake fluid.
The oil bolts are produced solely for use in motor vehicles. They are also designed in conformance with the Society of Automotive Engineers (SAE) standards for Automotive Hydraulic Brake System—Metric Banjo Connections revised October 2002 as well as SAE standards for Automotive Tube Fittings. In addition, the oil bolts must conform to the National Highway Transportation Safety Administration’s Federal Motor Vehicle Safety Standards.
In HQ 966412, CBP classified the oil bolts in subheading 7318.15.80, HTSUS, as other screws of iron or steel.
ISSUE:
Whether the above-described articles are classified in heading 7318, HTSUS, as other screws and bolts or in heading 8708, HTSUS as parts of motor vehicles and heading 8714 as motorcycle parts?
LAW AND ANALYSIS:
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI’s). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.
The Harmonized Commodity Description And Coding System Explanatory Notes (EN’s) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the EN’s 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. CBP believes the EN’s should always be consulted. See T.D. 89 80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
The HTSUS provisions under consideration are as follows:
7318 Screws, bolts, nuts, coach screws, screw hooks, rivets,
cotters, cotter pins, washers (including spring washers) and
similar articles, of iron or steel:
Threaded articles:
7318.15 Other screws and bolts, whether or not with their nuts or washers:
Other:
7318.15.80 Having shanks or threads with a
diameter of 6 mm or more.
* * * * * * * * * * * *
8708 Parts and accessories of the motor vehicles of headings
8701 to 8705:
Other parts and accessories:
8708.99 Other:
8708.99.80 Other.
* * * * * * * * * * * *
8714 Parts and accessories of vehicles of heading 8711 to 8713:
Of motorcycles (including mopeds):
8714.19.00 Other:
* * * * * * * * * * * *
In HQ 966412, CBP classified the oil bolts in heading 7318, HTSUS as fasteners based on the determination that they are parts of general use and not as parts of motor vehicles and motorcycles in headings 8708 or 8714 by application of note 2(b) to Section XVII, HTSUS, which provides that goods that meet the definition of a “part of general use,” as defined in Note 2 to Section XV, HTSUS, are excluded from classification in Section XVII, HTSUS.
HAM reiterates its contention that it raised in its original internal advice request that the oil bolts used in motor vehicles should be classified in heading 8708, HTSUS as parts and accessories of the motor vehicles of headings 8701 to 8705. With respect to the oil bolts used in the motorcycles, HAM argues that they should be classified in heading 8714, HTSUS as parts and accessories of vehicles of heading 8711 to 8713: Of motorcycles. HAM maintains that the oil bolts are not parts of general use because in order to be a part of general use, the part must be intended for general applicability across a wide spectrum of uses. According to HAM, the oil bolts under consideration do not satisfy this requirement, because they are only designed and actually used for discrete applications in motor vehicles or motorcycles. The pre-drilled, beveled, cross-sectional holes, the hollow shanks and/or the prominent stem negates the oil bolts consideration as parts of general use. It is also pointed out that HAM’s oil bolts are priced much higher than common bolts found in the market place.
However, the General ENs to Section XV contradicts this view as it states, in pertinent part, that:
(C) PARTS OF ARTICLES
In general, identifiable parts of articles are classified as such parts in their appropriate headings in the Nomenclature.
However, parts of general use (as defined in Note 2 to this Section) presented separately are not considered as parts of articles, but are classified in the headings of this Section appropriate to them (emphasis added). This would apply, for example, in the case of bolts specialized for central heating radiators or springs specialized for motor cars. The bolts would be classified in heading 73.18 (as bolts) and not in heading 73.22 (as parts of central heating radiators). The springs would be classified in heading 73.20 (as springs) and not in heading 87.08 (as parts of motor vehicles).
In other words, when an article is determined to be a part of general use of Section XV, HTSUS, it will be classified in the heading that specifically names or identifies the part even if it has a limited or specialized function. The two examples that the EN cites, “bolts specialized for central heating radiators” or “springs specialized for motor cars,” demonstrate that parts of general use, as defined in Note 2 to Section XV, presented or imported separately, are not considered as parts of articles in which they will be used. Instead, they are classified in the appropriate heading that describes them in Section XV. The unique characteristics of the oil bolts do not negate this concept.
We recognize that the “oil bolts” do have a specialized feature in that they are hollow and have a hole in their stem to enable the unimpeded passage of fluids. They are designed to permit the anchoring of brake, transmission or clutch lines, while also providing for the unimpeded passage of fluid into and through those same lines. Nevertheless, the oil bolts still have the function of fastening or securing the tubes, hoses, or lines to a fitting in the component system to which they are being assembled. Without the oil bolts, the lines or hoses would not be securely fixed to the component systems of the motor vehicle or motorcycle. This is the reason that they are threaded and must be torqued at their head with an instrument into a pre-existing hole to be tightened.
As we explained in HQ 966412, the oil bolts are cylinder shaped metal objects that have threads and a head designed or adapted for tightening by an instrument. Although they may be specialized screws for use in motor vehicles or motorcycles, they are nevertheless still screws, which would be classifiable in heading 7318, HTSUS. The fact that the oil bolts allow for the passage of fluids does not negate that they have a significant fastening function. This conclusion is further supported by EN 73.18, which states that heading 7318, HTSUS …includes all types of fastening bolts and metal screws regardless of shape and use. Because the oil bolts are classified under heading 7318 HTSUS, by application of the Section XVII, Note 2(b), they are excluded from being classified as parts of motor vehicles and motorcycles in headings 8708 and 8714 HTSUS.
HAM’s counsel cites NY F88921, dated July 7, 2000, which concerned a steel washer for use in two locations on a shock absorber strut. CBP found that the washers were classified in heading 8708 as parts and accessories of motor vehicles. Although in NY F88921 the importer referred to the articles under consideration as washers, CBP noted that they did not have the characteristics of a “part of general use” washers that in accordance with EN 73.18 are classified in heading 7318, HTSUS. The ruling explained that the articles were not small thin discs put in place to protect a part. Rather, the articles had a conical design to permit some flexibility of movement and that they had a design feature that functioned as a spacer to fill a gap. In other words, EN 73.18 presents a particular description of a washer, and the product that was under consideration in NY F88921 did not match it. In contrast, because they are cylindrical shaped metal objects that have threads and heads designed or adapted for tightening by an instrument, the oil bolts under consideration have the characteristics that EN 73.18 indicates are typical of screws classified in heading 7318, HTSUS. Accordingly, we conclude that NY F88921 is not applicable to the present situation. In addition, we are unaware of any authority to indicate screws of heading 7318, HTSUS, are precluded from being hollow or having a hole.
HAM further argues that we did not address the exclusionary language of EN 73.18(A)(c) and cites three rulings, HQ 086396, dated April 27, 1990, NY 856710, dated October 10, 1990, and NY F88794, dated July 12, 2000, which follow the exclusionary language of EN 73.18(A)(c). In these decisions, CBP held that fastener like components, screws used to make adjustments in automobiles, were classified under heading 8708, HTSUS, as automotive parts rather than as fasteners in heading 7318, HTSUS. We believe that these rulings are distinguishable from the present case because the articles in the cited rulings were primarily used to make adjustments rather than to fasten articles. To perform their primary function, these screws had to be physically turned. In contrast, the oil bolts in this case are not turned and remain stationary when they perform their function in an automotive system. EN 73.18(A)(c) excludes classification in heading 7318, HTSUS for “Threaded mechanisms, sometimes called screws, used to transmit motion, or otherwise to act as an active part of a machine”. We also note that the examples mentioned in EN 73.18 (A)(c), “Archimedian screws; worm mechanisms and threaded shafts for presses, valve and cock closing mechanisms” are all items that use movement to perform their function. Because the oil bolts do not move in performing their functions of keeping hoses and lines in place and allowing the passage of fluids, we conclude that the oil bolts are not described under the exclusion set forth in EN 73.18(A)(c). Therefore, we find that this exclusion for screws is not applicable to the oil bolts under consideration because after being tightened in place, the oil bolts remain stationary, do not transmit motion, and are not an active part of the motor vehicles or motorcycles, in which they are installed.
HAM also contends that classifying the oil bolts should be determined in accordance with GRI 3(c) in the heading which occurs last in numerical order because the oil bolts could be classifiable under two different headings in the HTSUS; as screws in heading 7318, HTSUS or as automotive or motorcycle parts in headings 8708/8714, HTSUS. First, we disagree that it is necessary to apply GRI 3, because as explained above, the oil bolts are classified in accordance with GRI I. Assuming even if GRI 3 is applied, we believe that the oil bolts would still be classified in heading 7318, HTSUS rather than headings 8708/8714, HTSUS. Classification under GRI 3 becomes relevant when goods are, prima facie, classifiable under two or more headings. Under GRI 3(a), goods are classified in the heading which provides the most specific description.
GRI 3(a) states:
When by application of rule 2(b) or for any other reason, goods are prima facie, classifiable under two or more headings, classification shall be effected as follows:
(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods or to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific in relation to those goods, even if one of them gives a more complete or precise description of the goods.
In our judgment, heading 7318, HTSUS, a heading for screws, bolts, nuts coach screws, and similar articles, of iron or steel etc., provides a more specific description than that of headings 8708/8714, HTSUS, which are general basket provisions for parts and accessories of the motor vehicles or motorcycles. Moreover, the oil bolts are not mixed or composite goods or sets put for retail sale. Consequently, the oil bolts can be classified under GRI 3(a), and it is unnecessary to apply GRI 3(c) to classify the oil bolts.
HMA Arguments
HMA refers to the subject merchandise, which are used only in motor vehicle braking systems, as hose fittings. It contends that the oil bolts are outside the scope of Heading 7318, HTSUS, because their primary function is to provide for the unimpeded flow of brake fluid between the brake hose assembly and motor vehicle system. HMA claims that the fastening attributes of the oil bolts are only of secondary importance. According to HMA, because there is no tariff provisions for hose fittings, the oil bolts should be classified in heading 8708, HTSUS, as parts of the motor vehicles in which they are installed. HMA claims that industry and government specifications support a finding that the oil bolts should be classified as parts of motor vehicles classified in heading 8708, HTSUS, rather than as fasteners of heading 7308, HTSUS.
HMA concedes that the subject merchandise does not qualify as fittings of the HTSUS because they do connect to a tube or pipe. However, HMA believes that heading 7307 which provides for tube and pipe fittings is instructive in classifying hose fittings. EN 73.07 explains in pertinent part as follows:
This heading covers fittings or iron or steel, mainly used for connecting the bores of two tubes together, or for connecting a tube to some other apparatus, or for closing the tube aperture. This heading does not however cover articles used for installing pipes and tubes but which do not form an integral part of the bore, e.g., hangers, stays and similar supports which merely fix or support the tubes and pipes on walls, clamping or tightening bands or collars . .
The connection is obtained:
- by screwing, when using cast iron or steel threaded fittings; . . . This heading therefore includes . . . unions . . . This heading excludes: . . . (b) Bolts, nuts, screws, etc., suitable for use in the assembly of tube or pipe fittings (heading 73.18).
While it may be generally understood that in a generic sense a fitting will be used to make a connection, the oil bolts under consideration are used for more than just joining the brake hoses to the rest of the braking system. Instead, the oil bolts are used to secure or hold in place the brake hoses to the braking system. We note that based on the submitted pictures, a banjo fitting is used to connect the brake hoses to the braking system, and that the oil bolts secure the brake hoses. In other words, it is the oil bolts that secure or fasten the brake hoses to the banjo fittings. The fact that the oil bolts are hollow and have a hole, which permits brake fluid to pass through them, does not negate their function of securing the brake hoses to the braking system. The importance of the fastening function is demonstrated by the fact that while the hose can be connected directly to the banjo fitting without the oil bolt, this connection would not be secure and the hose may not stay in place. Rather, it is the oil bolts that keep the brake hoses in place. In other words, the oil bolts function basically as screws.
HMA asserts that the industry standard, “Automotive Hydraulic Brake System—Metric Banjo Connections (SAE J1291)”, should control how the oil bolts are classified under the HTSUS. This standard sets forth the dimensional metric specifications for hydraulic brake system threaded ports and for interconnection of major components in automotive hydraulic brake systems and indicates that the banjo bolts are used together with the threaded port function for interconnection to a braking system. However, there is nothing in the standard, which indicates that the banjo bolts do not function as fasteners and that they do not meet the terms of heading 7318, HTSUS, as screws when they secure brake hoses in place. Therefore, we find no support in it to conclude that the oil bolts should be considered hose fittings and not fasteners.
Furthermore, HMA reliance on the case of Rocknel Fastener, Inc. v. United States, 118 F. Supp. 2d 1238 (Ct. Int’l Trade 2000) affirmed 267 F.3d 1354 (2001) is similarly misplaced. The Rocknel case concerned fasteners classified in heading 7318, HTSUS. There was no dispute that the items were fasteners classifiable in heading 7318, HTSUS. The issue in the Rocknel case was in which of the subheadings under heading 7318, HTSUS were the fasteners classified. The court affirmed CBP application of the recognized industry standards to determine how the items in question were classified. Because the oil bolts secure brake hoses in place, we find that they should be regarded as screws, which are classified in heading 7318, HTSUS. Therefore, we affirm our holding in HQ 966412, that oil bolts are screws of iron or steel classified in subheading 7318.15.80, HTSUS.
HOLDING:
The subject oil bolts for use in motor vehicles and motorcycles are classifiable in subheading 7318.15.80, HTSUS, as other screws of iron or steel. If the oil bolts were made of stainless steel they would be classified in subheading 7318.15.80.55, HTSUS, but if they were made of another type of steel, they would be classified in subheading 7318.15.80.65, HTSUS. In either case, the column one general rate of duty is 8.5 percent ad valorem. Duty rates are provided for convenience and are subject to change. The text of the most recent HTSUSA and the accompanying duty rates are provided on the World Wide Web at www. USITC.gov.
Your office should mail this decision to the party requesting internal advice. The Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
EFFECT ON OTHER RULINGS:
HQ 966412, dated September 3, 2003 is affirmed.
Sincerely,
Myles B. Harmon, Director
Commercial Rulings Division