CLA-2: RR:CR:TE: 967596 BtB
Port Director
U.S. Customs & Border Protection
555 Battery Street San Francisco, CA 94111
RE: Decision on Application for Further Review of Protest No. 2809-04-100647; Classification of Rigid Inflatable Boats
Dear Port Director:
This is a decision on the Application for Further Review (“AFR”) of Protest Number 2809-04-100647, timely filed by ABX Logistics USA, on behalf of Protector USA, Inc. (“protestant”), concerning the classification under the Harmonized Tariff Schedule of the United States Annotated (“HTSUSA”) of two sizes of Protector sport utility boats, the Protector 22’ and the Protector 28’. In this decision, both sizes of the boats will be referred to as the “Protector Boats.”
FACTS:
The Protector Boats are boats, in the sizes set forth above, which have a rigid fiberglass hull and two large inflatable hypalon sponsons, or air chambers, around the perimeter of the gunwales of the deck. The sponsons run from the bow to just past the stern. The Protector Boats are individually valued over $500.00 and will be used in recreational boating.
Sixteen shipments of the Protector Boats were entered through the Port of San Francisco from October 27, 2003 through October 13, 2004. The shipments of Protector Boats were entered under subheading 8903.99.2075, HTSUSA, which provides for “Yachts and other vessels for pleasure or sports; row boats and canoes: Other: Other: Outboard motorboats, Other.” These entries were later rate advanced by U.S. Customs and Border Protection (CBP) and liquidated under subheading 8903.10.0015, HTSUSA, which provides for: “Yachts and other vessels for pleasure or sports; row boats and canoes: Inflatable, Valued over $500: With attached rigid hull.”
Further review of Protest Number 2809-04-100647 was properly accorded to protestant pursuant to 19 C.F.R. § 174.24 because the decision against which the protest was filed involves matters previously ruled upon by the Commissioner of Customs or his designee or by the Customs courts but facts are alleged or legal arguments presented which were not considered at the time of the original ruling.
Protestant asserts that the Protector Boats are properly classified as entered because they are capable of floating solely on their rigid fiberglass hulls; therefore, they are not “inflatable” and cannot be classified in subheading 8903.10.0015, HTSUSA. In support of its Protest, protestant has provided some photographs of the Protector Boats floating without sponsons and a few pages of marketing material.
ISSUE:
Whether the Protector Boats are classified in subheading 8903.10.0015, HTSUSA, which provides for: “Yachts and other vessels for pleasure or sports; row boats and canoes: Inflatable, Valued over $500: With attached rigid hull.”
LAW AND ANALYSIS:
Classification under the HTSUSA is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides, in part, that classification decisions are to be "determined according to the terms of the headings and any relative section or chapter notes." In the event that goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRI may then be applied, in order.
The Harmonized Commodity Description and Coding System Explanatory Notes (EN) constitute the official interpretation of the Harmonized System at the international level (for the 4 digit headings and the 6 digit subheadings) and facilitate classification under the HTSUSA by offering guidance in understanding the scope of the headings and GRI. While neither legally binding nor dispositive of classification issues, the EN provide commentary on the scope of each heading of the HTSUSA and are generally indicative of the proper interpretation of the headings. CBP believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989).
The determinative issue in this case is whether the Protector Boats are “inflatable.” If they are, they are classified in subheading 8903.10.0015, HTSUSA. If they are not, they are classified in subheading 8903.99.2075, HTSUSA.
There is no case law or CBP rulings interpreting “inflatable” in heading 8903, HTSUSA. However, when classifying merchandise under the HTSUSA, terms are to be construed according to their common and commercial meanings which are presumed to be the same. See Faus Group, Inc. v. United States, 358 F. Supp. 2d 1244 (Ct. Int’l Trade, 2004).
Protestant argues that the Protector Boats are not “inflatable.” Yet, on the protestant’s webpage (www.protectorboats.com), the Protector Boats are explicitly referred to as “inflatable” boats:
Orignally engineered for the New Zealand Coast Guard, PROTECTOR is a multi-purpose, high-performance, hard bottom inflatable powerboat. The solid laminate, fiberglass hull is built for strength and safety. The chambered hypalon tubes provide shock absorption, stability and additional floatation. Together, the deep-V hull and UV resistant tubes create unmatched safety and performance compared to traditional hard sided boat designs. [Emphasis added].
Furthermore, on the protestant’s webpage, as well as in the marketing material provided by protestant, the Protector Boats are specifically described and marketed as “Rigid Inflatable Boats” or “RIBs.”
On its website, the U.S. Coast Guard states that RIBs “… are deep-V glass-reinforced plastic hulls to which a multi-compartment buoyancy tube is attached. They are powered by either a gasoline outboard motor or an inboard/outboard diesel engine.” A more thorough description of RIBs is found at www.allinflatables.com, the webpage of an information provider and seller of inflatable boats:
Rigid inflatable boats or RIBs, usually range in size from as small as about 7 feet for yacht tenders and up to about 30 feet long. They can go bigger in some special applications. They are generally used for tenders, sport boats and very often for commercial, rescue and military applications.
As their name suggests, these boats feature a fiberglass or aluminum rigid hull mated to an inflatable collar. This allows a conventional deep V-hull shape at the bow, flattening out to common planing sections aft. The concept marries the famous buoyancy and stability of an inflatable boat with the excellent handling characteristics of a conventional fiberglass hull. The larger boats in this range offer a wide range of console configurations, seating and other features such as built-in storage lockers, and many other features typically found on larger fiberglass vessels.
The benefits of the RIB are quickly seen in increased performance and handling, coupled with versatility, stability and passenger comfort. The smaller rigid-hulled inflatables make excellent yacht tenders for larger yachts, while the larger RIBs make perfect watersports or fishing boats, particularly because of their flotation, stability and safety. Many rescue and military agencies have recognized the seaworthiness, safety and stability of RIBs and use them in many applications.
While the Protector Boats are specifically identified as RIBs on protestant’s website, protestant states the following in support of its Protest:
Many use the RIB acronym as a way to describe all boats with tubes. But our Protectors are quite different boats from these “RIBS”. They are large – 25-40’; they float on their own fiberglass hull – not on the tubes; they have cabins, and in some cases full living accommodations, and the tubes are not intended as floatation (stet.) but instead as an added feature of the boat.
Protestant also attempts to distinguish the Protector Boats from the boats in NY A81542, dated April 2, 1996, stating:
This ruling [NY A81542] refers to Rigid Inflatable Boats with rigid V hulls; transom and antiskid deck. The length of the boats range from 2.81, 3.11 and 3,41 (stet.) meters. This ruling classifies these boats as inflatable pleasure crafts valued over $500.00 with attached rigid hulls (8903.10.0015) at 2.4%. This classification seems to correspond to the types of boats which usually are made out of a multi-compartment buoyancy rigid inflatable tube attached to fiberglass V hulls which are a completely different product than the Protector Boats.
Protestant also represents that the sponsons on the Protector Boats provide only: “(1) a soft side for bumping into other obats [boats](stet.); (2) a softer landing when hitting a big wave; and (3) low freeboard for being able to swim or retrieve divers.” Protestant emphasizes that “The boats DO NOT float on the tubes.”
First, we find that the Protector Boats are RIBs. As the Protector Boats feature a fiberglass rigid hull mated to two sponsons that are at the core of the boats’ design and function, we find that they clearly fall within the accepted commercial definition of RIBs. As the Protector Boats are identified on protestant’s website and marketing material as RIBs, we find it curious that protestant attempts to distinguish the models at issue from this class of boat in statements made in support of its Protest. Also, while protestant cites the sizes of the boats as one of the reasons why the Protector Boats are not RIBs, we find that size is not determinative in analyzing whether a boat falls within that class of boat. While the Protector Boats are larger than the boats classified in NY A81542, all of the models feature fiberglass hulls mated to hypalon buoyancy tubes that are at the core of their design and function. The fact that the boats in NY A81542 are smaller, may depend more on the tubes for buoyancy, or may have differently shaped fiberglass hulls is not determinative. All of the boats possess the core features of RIBs and, accordingly, we find that all fall within that class of boat.
Second, we recognize that the Protector Boats are capable of floating without their sponsons attached and inflated. We question the usefulness the Protector Boats would have in this condition, however. It is the sponsons that are at the core of the design and structure of the Protector Boats and provide the boats with their key attributes in their intended applications. As stated on protestant’s website, the sponsons impart “shock absorption, stability and additional floatation” to the vessels. [Emphasis added]. The sponsons function to absorb the kinetic energy and push the boat back up in choppy waves, provide enormous lateral stability and floatation in rough water, and provide additional buoyancy when carrying heavy loads. These attributes are integral in the applications in which the boats will be used and are the primary reasons one would purchase or use the Protector Boats, or any RIB. As we have determined that the Protector Boats are RIBS, a commercially recognized type of inflatable boat, and that their inflatable sponsons are central to their design and structure, we conclude that the Protector Boats are “inflatable” under heading 8903, HTSUSA.
An eo nomine provision is one which describes merchandise by a specific name, usually one well known in the trade, which includes all forms of the article as if each were provided for by name in the tariff provisions. See Wregg Imports v. United States, 10 C.I.T. 679, 681 (Ct. Int'l Trade, 1986). Subheading 8903.10, HTSUSA, is an eo nomine provision, providing for “Yachts and other vessels for pleasure or sports; row boats and canoes: Inflatable” by name. There is no indication that Congress intended to limit this provision to small inflatables. Therefore, we find that the provision encompasses all forms of inflatable boats, including RIBs, the class of boats into which the Protector Boats fall.
HOLDING:
The Protector 22’ and the Protector 28’ boats are classified in subheading 8903.10.0015, HTSUSA, which provides for: “Yachts and other vessels for pleasure or sports; row boats and canoes: Inflatable, Valued over $500: With attached rigid hull.” The duty rate at the time of the entries was 2.4 percent ad valorem.
The Protest should be DENIED.
In accordance with Section IV of the Customs Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), you are to mail this decision, together with the CBP Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entries in accordance with the decision must be accomplished prior to mailing of the decision.
No later than 60 days from the date of this letter, 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 by other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division