RR:CR:GC 967380 RSD
TARIFF NO: 8535.90.80
Port Director
U.S. Customs and Border Protection
111 West Huron Street Buffalo, NY 14202
RE: Request for Internal Advice 04/026 regarding the classification of bushings used with electrical transformers
Dear Port Director:
This letter is in response to an internal advice request that FedEx Trade Networks filed on behalf of Trench Limited concerning the classification of bushings used with electrical transformers in electric power distribution systems under the Harmonized Tariff Schedule of United States (HTSUS). Various literature and information concerning the product under consideration were submitted.
FACTS:
The products under consideration are bushings used primarily in applications with transformers in electric power systems. The devices are used with an electric power transformer, insulating the center conductor from the transformer tank and conducting current into/from the transformer. The manufacturer of the bushings is Trench Canada (Trench). Trench makes two basic models of bushings, COTA and COBA. Only a description of the Trench Type COTA bushings was provided. They are designed for application on liquid filled power transformers. They are used to connect a power transformer to overhead lines or to an exposed bus in either outdoor or indoor conditions. Connection to the transformer winding leads can be accomplished by one of three methods:
Bottom connected via a fixed copper conduction;
Connected via a copper draw lead cable(s) supplied with the
power transformer; or
Bottom connected via Trench’s all copper “Split-Conductor” draw
lead.
The method selected depends on the voltage rating, maximum through current, or user preference. Connection to the power system is accomplished with an industry standard threaded top terminal. The active part of the COTA bushing is constructed of oil-impregnated paper with layers of aluminum foil. The position of the foil layers is computer optimized to ensure a homogenous electrical field, radially and axially controlled, providing extremely high dielectric resistance. Depending on the rated current, the active part is wound on either an aluminum central tube or a fixed conductor.
The housing is constructed of a head, outdoor insulator mounting flange, ground sleeve (COTA 250 and above) and an epoxy insulator. It is held together by either a central aluminum tube or a fixed copper conductor. Pre-tensioned coned spring washers provide mechanical stability over the entire temperature range, ensuring a leak free bushing. COTA bushings are sealed exclusively with O-Ring gaskets and each bushing is hermetically sealed with its own independent oil reservoir. The interiors of aluminum castings are painted.
The bushings were originally entered under heading 8546, HTSUS as electrical insulators. The Port of Buffalo and the Port of Detroit issued Customs Form (CF) 29s to Trench reclassifying the bushings under different HTSUS headings. The Port of Buffalo reclassified the bushings under heading 8535, HTSUS, as electrical apparatus for switching or protecting circuits or for making connection to or in electrical circuits. The Port of Detroit classified the bushings in heading 8504, HTSUS, as parts of electrical transformers. Trench claims that although the bushings are covered by two different entries and have different part numbers they perform the same function. They are requesting internal advice in order to obtain uniformity between the two ports that they use to import the bushings.
ISSUE:
Whether the bushings used with electrical transformers are classified in heading 8504, HTSUS, as parts of electrical transformers or in heading 8535, HTSUS, as electrical apparatus making connection to or in electrical circuits or in heading 8546, HTSUS, as electrical insulators?
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 HTSUS provisions under consideration are as follows:
8504 Electrical transformers, static converters (for example,
rectifiers) and inductors; parts thereof:
8504.90 Parts:
Other:
8504.90.85 Other.
* * * * * * * * * * * * *
8535 Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, fuses, lightning arresters, voltage limiters, surge suppressors, plugs, junction boxes) for a voltage exceeding 1,000 V:
8535.90 Other:
8535.90.80 Other.
* * * * * * * * * * * * *
8546 Electrical insulators of any material:
8546.20.00 Of Ceramics:
* * * * * * * * * * * * *
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 and Border Protection (CBP) believes the ENs should always be consulted. See, T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989). EN 85.04 states in pertinent part, that:
Electrical transformers are apparatus which, with having any moving parts, transform, by means of induction and using a preset or adjustable system, an alternating current into another alternating current of different voltage, impedance, etc. These usually consist of two or more coils of insulated wire wound on laminated iron cores, although in some cases (e.g., radio-frequency transformers) there may be no magnetic core, or the core may be of agglomerated iron dust, ferrite, etc. An AC in one coil (the primary circuit) induces an AC usually at different values of current and voltage in the others (the secondary circuit). In certain cases (auto transformers) there is only a single coil, part of the winding of which is common to the primary and secondary circuits. In shell type transformers, there is a shell of laminated iron round the transformer.
* * * * * * * * * * *
The heading covers all transformers. They vary from ballast for control of the amount current through discharge lamps or tubes, small type used in wireless sets, instruments, toys, etc. to large types enclosed in oil tanks or equipped with radiators fans etc. for cooling purposes. The large types are used in electricity stations, stations for interconnecting mains, distributing stations or sub-stations. The frequency may vary from mains frequencies up to very high radio frequencies. The heading includes baluns (balancing units) which reduce electro-magnetic interference by balancing the impedance in paired lines.
EN 85.35 indicates:
This heading covers electrical apparatus generally used in
power distribution systems. The provision of Explanatory Note to heading 85.36 apply, mutatis mutandis, as regards the technical characteristics and the functioning of apparatus for switching or protecting electrical circuits or for making connections to or in electrical circuits. The heading covers apparatus of the kinds described in Explanatory Note 85.36 when for a voltage exceeding 1,000 volts.
In order to be classified in Heading 8504, HTSUS, an article must be a transformer or a part of a transformer. In this instance, Trench’s product literature indicates that it designs and manufacturers “high voltage bushing for all applications. This includes bushings for transformers, breakers, generators, gas-power insulated substations, railway power distribution, as well as other special applications to meet our customer’s needs.” Thus, although the bushings may often be used with transformers in electrical power systems, it is not clear that this is their only use.
Because the competing provisions are in chapter 85, HTSUS, within Section XVI, we must consider Section XVI, Note 2, HTSUS, to determine if it governs classification of the bushings. Note 2, states in pertinent part, that parts of machines are to be classified according to the following rules:
(a) Parts which are goods included in any of the headings of chapter 84 and
85 (other than headings 8409, 8431, 8448, 8466, 8473, 8485, 8503, 8522, 8529, 8538 and 8548) are in all cases to be classified in their respective headings;
(b) Other parts, if suitable for use solely or principally with a particular kind of
machine, or with a number of machines of the same heading (including a
machine of heading 8479 or 8543) are to be classified with the machines of that kind or in heading 8409, 8431, 8448, 8466, 8473, 8503, 8522, 8529 or 8538 as appropriate …
In considering Note 2(a) and 2(b), respectively, it is necessary to determine
whether the bushings at issue can be classified by themselves, or only as a part for a transformer. If it is separately classifiable as a product of chapter 84 or 85, Note 2(a) is applicable and the bushings will be classified in their respective heading, regardless of the fact that it is a part for electrical transformers. If it cannot be classified separately as a product of chapter 84 or 85, Note 2(b) is applicable and the bushings will be classified under heading 8504, HTSUS, as a part of the electrical transformer.
Although the bushings are designed to work with transformers in electrical power grids, we believe that they are specifically described in heading 8535, HTSUS as devices for making an electrical connection other than in heading 8504, HTSUS as a part of a transformer. A bushing is a device used to carry current at high potential through a grounded barrier, e.g. a transformer tank. The web site http://www.bpa.gov/corporate/pubs/definitions/b.cfm provides the following definition for bushing:
An insulating structure, generally of porcelain and conical or cylindrical in shape, having a central conductor and provisions for mounting on a piece of equipment or wall: insulates the conductor and permit carrying current through a grounded barrier, such as a transformer tank, circuit breaker, or building wall.
The Institute of Electrical and Electronics Engineers, Inc., (IEEE) Standard General Requirement and Test Procedure provides a second definition for Power Apparatus Bushings C57.19.1991, which indicates:
Bushing. An insulating structure, including a through-conductor or providing a central passage for such a conductor, with provision for mounting on a barrier, conducting or otherwise, for the purpose of insulating the conductor from the barrier and conducting current from one side of the barrier to the other.
In considering heading 8546, HTSUS, we note that this heading covers electrical insulators. The Modern Dictionary of Electronics Seventh edition by Rudolf F. Graf 1999, indicates the following regarding the term insulator:
A nonconducting substance such as porcelain, plastic, glass, rubber, etc.
A material of low electrical conductivity designed for supporting a conductor physically and electrically separating it from another conductor or objects.
Heading 8546, HTSUS, provides for electrical insulators themselves and does not provide for conductors or connectors. As such, articles of heading 8546, HTSUS, are not designed to conduct electricity. Although the bushings under consideration do contain insulating material, they consist of more than the insulating materials, and as such they do not function as insulators. Rather, the bushings transmit electrical current and serve to connect an electrical device (e.g. transformer, reactor, circuit breakers, etc.) into a power distribution system. The insulating materials are put into the bushings to prevent short circuits, electrical shocks, etc. Since heading 8546, HTSUS, only covers the insulator components of the bushings; it does not cover the other elements of the electrical apparatus of the bushings that serve to conduct electric current when they connect a transformer to a power grid. Thus, we conclude that the bushings are not classified in heading 8546, HTSUS.
Based on the above definitions of bushings, we conclude that for tariff purposes the principal function of a bushing is to connect an electrical device such as a transformer into an electrical distribution system like an electrical power grid. While there are differences between the type of bushings Trench produces, they all appear to contain apparatus for making an electrical connection in that all the bushings appear to have a top terminal and one or more taps. In addition, depending on the model, bushings may also contain a fixed conductor, a bottom terminal, multiple spring contact, draw lead stud, etc. Thus, in accord with the diagrams and the pictures that were submitted, the bushings appear not to be a component of an electrical transformer, but rather a complete device that is outside of the transformer. The bushings are attached to a transformer and are used to connect the transformer to a power grid.
Heading 8535, HTSUS, provides in part for “electrical apparatus for… making connection to or in electrical circuits….” An electrical connector acts as a coupling device that provides both electrical and mechanical coupling of cables or between a cable and a chassis or enclosure. The EN 85.35 and EN 85.36 indicate that devices of headings 8535 and 8536, HTSUS, are generally composed of both conducting elements and insulating elements. The electrical bushings under consideration contain both insulating and conducting materials. Accordingly, based on the information available, including the definitions for electrical bushings cited above, we conclude that the bushings under consideration function to connect electrical devices such as a transformer to a power grid. Therefore, we find that the bushings under consideration are classified by application of Note 2(a) to Section XVI, in heading 8535, HTSUS, as electrical apparatus for switching or protecting electrical circuits or making connections to or in the electrical circuits for a voltage exceeding 1,000 volts. Consequently, we conclude that the bushing would not be classified in heading 8504, HTSUS, as parts of electrical transformers.
HOLDING:
The bushings used with a transformer in electrical power distribution systems are classified in subheading 8535.90.80.40, HTSUS as: “Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits…for a voltage exceeding 1,000 V: Other: Other: Other connectors.”
You are to mail this decision to counsel for the internal advice applicant no later than 60 days from the date of this letter. On that date the Office of Regulations and Rulings will take steps to make the decision available to Customs personnel, and to the public on the Customs 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.
Sincerely,
Myles B. Harmon, Director
Commercial Rulings Division