CLA-2 OT:RR:CTF:TCM H017651 JER
Terrie A. Gleason, Esq.
Baker & McKenzie LLP
815 Connecticut Avenue, NW
Washington, D.C. 20006
RE: Reconsideration of HQ W968364; classification of a wheel hub assembly incorporating two tapered roller bearings for self-propelled articulating booms
Dear Ms. Gleason:
This is in response to your request of September 10, 2007, for reconsideration of Headquarters Ruling Letter (“HQ”) W968364, issued on January 8, 2007, to your client, Blackstone OTR (“Blackstone”) concerning the classification of certain merchandise under the Harmonized Tariff Schedule of the United States (“HTSUS”). In HQ W968364 U.S. Customs and Border Protection (“CBP”) classified this merchandise under subheading 8483.20.80, HTSUS, as, other housed bearings, incorporating ball or roller bearings. It is your contention that subheading 8483.20.80, HTSUS, does not describe the merchandise at issue. You contend that the merchandise is properly classified under subheading 8431.20.00, HTSUS.
On January 26, 2009, a meeting was held with counsel and a consultant for Blackstone. In that meeting, the classification, design and functionality of the subject wheel hub assembly was discussed in detail. In reaching our decision, we considered the information submitted and presented by you on January 26, 2009. For the reasons set forth below, we hereby affirm HQ W968364.
FACTS:
The merchandise at issue is a wheel hub assembly designed for use on Genie Industries’ self-propelled articulating booms. The wheel hub assembly (model 8080004) consists of a cast hub with eight threaded studs, one crescent dust cap, an oil seal, eight 5/8 inch mounting nuts and two tapered roller bearings (an inner and outer bearing). The tapered roller bearings (“TRB”) are each composed of an outer ring (or race) called a cup, an inner ring (or race) called a cone and a cage which hold the roller bearings. As described in HQ W968364, the smaller diameter bearing fits into the top end of the hub while the larger diameter bearing fits into the underside of the hub. The bearings fit into the cast hub such that the inner races of the bearings can be mounted onto an axle of the boom. A wheel can then be mounted onto the same axle by allowing the wheel to be mounted over the studs on the hub onto the outer races of the bearings.
In HQ W968364, CBP distinguished the subject wheel hub assembly from wheel hub assemblies which were the subject of New York Ruling Letter (“NY”) 892200, dated November 26, 1993. The wheel hubs of NY 892200 had additional functionality as they were designed for use in drive axles and therefore beyond the scope of heading 8483, HTSUS.
In HQ W968364, CBP stated that:
The compelling factor in NY 892200 that resulted in the heading 8431 classification was that the wheel hub was for use with a drive axle. Such hub assemblies are designed not only to reduce friction between moving parts and to facilitate the mounting of a wheel, but also to transmit torque to the wheel from the axle onto which the wheel is mounted. This additional functional capability places the wheel hub assembly outside the scope of heading 8483.
ISSUE:
Whether the subject merchandise is classified under heading 8431, HTSUS, as parts of machinery of heading 8427, HTSUS, or under heading 8483, HTSUS, as housed bearings.
LAW AND ANALYSIS
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). 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 2 through 6 may then be applied in order.
The 2009 HTSUS provisions under consideration are as follows:
8431 Parts suitable for use solely or principally with the machinery of headings 8425 to 8430:
8431.20.0000 Of machinery of heading 8427
8483 Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof:
8483.20 Housed bearings, incorporating ball or roller bearings:
8483.20.40 Flanged, take-up, cartridge and hanger units
8483.20.80 Other
Section XVI, Note 2 provides in pertinent part, as follows:
Subject to note 1 to this section, note 1 to chapter 84 and note 1 to chapter 85, parts of machines (not being parts of the articles of heading 8484, 8544, 8545, 8546 or 8547) are to be classified according to the following rules:
Parts which are goods included in any of the headings of chapter 84 or 85 (other than headings 8409, 8431, 8448, 8466, 8473, 8487, 8503, 8522, 8529, 8538 and 8548) are in all cases to be classified in their respective headings;
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. However, parts which are equally suitable for use principally with the goods of headings 8517 and 8525 to 8528 are to be classified in heading 8517.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System. While not legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127 (August 23, 1989).
Hub vs. Housing
It is your contention that the decision in HQ W968364 confused a “housed bearing” with a wheel hub “containing a bearing” and thereby incorrectly classified the subject wheel hub assembly in heading 8483, HTSUS. It is your position that the subject wheel hub assembly is a part suitable for use solely or principally with the Genie Industries’ self-articulating boom (a machine classifiable in heading 8427) and is therefore properly classified in heading 8431, HTSUS, as a part used with machinery of headings 8425 to 8430 (fork-lift trucks; other trucks fitted with lifting or handling equipment of heading 8427, HTSUS).
You further assert that the subject wheel hub is unlike commercially recognized “housed bearings” such as pillow blocks, flanged housings, take-up or cartridge housings because these items “can be bolted to a stationary surface” and that “[u]nlike housed bearings, the wheel hubs are not intended to hold the axle in place on the frame so that it can rotate, but rather to provide a method of attaching the wheel to allow the wheel to rotate.” You also assert that the “brackets” described in EN 84.83 reference brackets which can be fixed to a machine or wall and therefore does not describe the subject wheel hub assembly.
In support of your position, you offer the opinion of a private consultant. From that opinion, you conclude that “the main difference between a housed bearing and a wheel hub containing a bearing is that in a housed bearing the housing does not rotate and is intended to maintain the bearing in a stationary position, while a wheel hub is designed to hold a wheel and the hub rotates.” Essentially, you espouse that a housed bearing is a stationary device and that a wheel hub is a rotational device. Thus, in your opinion, the instant wheel hub assembly cannot be classified as a housed bearing. We disagree. While the subject wheel hub may rotate, the bearings themselves remain stationary in relation to the wheel hub and the hub itself is fixed to a wheel by means of eight threaded studs.
The ENs to heading 8483, HTSUS, provide in pertinent part that:
Bearing housings consist of a frame or block designed to house the plain, ball, roller, etc., bearing in which (or, in the case of a thrust bearing, against which) the ends of a shaft or axle turn…They also often incorporate a chair, plate, bracket, etc., by which they can be fixed to the machine, or to a wall or other part of a building…[Emphasis added].
As the ENs to heading 8483 explain bearing housings house ball or roller bearings “in which” or “against which” the ends of a shaft or axle turn. Accordingly, EN 84.83 contemplates housed bearings like the subject wheel hub in which and against which rotation occurs. Tapered roller bearings like those of the instant wheel hub are designed to support both axial and radial loads while permitting rotation between two or more parts. In the instant case, the tapered roller bearings function not only as radial bearings, supporting loads perpendicular to the axle onto which they are mounted, but also as thrust bearings against which the axle turns. Tapered roller thrust bearings accommodate extremely heavy axial loads such as the Genie articulating boom and can be housed in a variety of housing structures such as a pillow block, flange or in this case a wheel hub. While the subject wheel hub is without a bracket or plate it consists of a complete tapered roller bearing housed within a flanged mounting unit which is fixed to a wheel or other apparatus. As such, the subject merchandise is described by the ENs to heading 8483, HTSUS.
Like other housed bearings (pillow block or flanged), the subject wheel hub assembly contains insert bearings and has a flat mounting surface. The insert bearing of a housed bearing is a separate and distinct component consisting of an inner and outer ring, cage and rolling elements all of which is generally marketed and sold already within the housing. Flanged housing units for example, contain insert bearings, a flat mounting surface and as many as four bolts by which the unit is mounted. The subject wheel hub is no different. As with other housed bearings, the shaft diameter correlates with the bore dimensions in which the bearings are inserted and like “four bolt flanged units”, the eight bolts secure the flanged hub in place and facilitates axial rotation.
In either case, we find that housed bearings are designed to reduce rotational friction through the use of ball or roller bearings. For tariff purposes, bearings reduce friction by providing smooth metal balls or rollers, and a smooth inner and outer metal surface (ring) for the balls to roll against. Bearings function in situations involving radial or thrust loads. The balls or rollers "bear" the load, allowing a device to rotate or move smoothly. In the automotive field, axle or wheel bearings have traditionally been pressed between a shaft, such as an axle shaft, and another component, such as a wheel hub. However, newer designs have enhanced the bearing design so that the outer or inner rings are flanged for attachment directly to a suspension component or for attachment of a wheel or hub. See HQ 965168, dated July 25, 2002.
While the subject wheel hub assembly is not a wheel hub bearing unit as described in HQ 965168, as neither the cone nor the cup is flanged to form the hub, the principal function of the subject wheel hub assembly is to decrease rotational friction. The subject wheel hub assembly consists of a separate TRB cone assembly which includes: an outer ring called a cup, an inner ring called a cone and a cage to hold the roller bearings. The entire TRB cone assembly, including the outer ring is pressed or fitted inside the inner core of the wheel hub to facilitate the anti-friction function. Such item is often referred to as a wheel hub containing tapered bearings and is distinct from first, second and third generation wheel hub units. Yet, wheel hub units, even generations 2 and 3, are “simply bearings modified in ways similar to otherwise enhanced parts containing raceways. While wheel hub units may have features which allow them to serve additional functions such as facilitating mounting, they retain their essential function.” In that respect, the subject wheel hub assembly is no different. The hub is specifically designed to hold the bearing in place and incorporates studs which allow the hub, together with the inserted TRBs, to be bolted to the wheel. However, the primary purpose of the subject wheel hub like other housed bearings is to facilitate the mounting of a bearing which in turn acts to reduce rotational friction.
Furthermore, despite your argument to the contrary, classification under heading 8483, HTSUS, has never been limited to whether a housed bearing is a stationary device or whether such devices are commercially recognized as either a pillow block, flanged, take-up or hanger unit. For example, in NY E83643, dated July 28, 1999, CBP classified an “end cap assembly” with a plastic housing in heading 8483, HTSUS, as a housed bearing. In that decision, the plastic housing held the bearings in place and facilitated mounting on the end cap assembly to the end of a conveyor or roller. A roller conveyor by definition and function is not a stationary device but instead is a rotational device which facilitates the movement of articles from one location to another (e.g., along a conveyor belt or assembly line).
Likewise, while the language of EN 84.83 implies that such housings are often intended to remain stationary, the language does not refer to stationary use as a mandatory requirement. EN 84.83 clearly explains that such housings “often” incorporate a chair, plate or bracket, such that the housing can remain fixed to a machine, wall or part of a building. Hence, the qualifying language in EN 84.83 (i.e., the use of the word “often”), indicates that other non-stationary applications are acceptable. For example, in NY M84091, dated June 29, 2006, CBP classified a hub assembly and wheel bearing repair kit in heading 8483, HTSUS, despite the fact that the wheel hub was a rotational device. The hub assembly consisted of a complete wheel hub assembly incorporating two tapered roller bearings with the outer races of the TRB being fitted into the wheel hub. As such, the hub assembly in NY M84091 was substantially similar to the subject wheel hub.
Similarly, in NY 801838, dated, October 11, 1994, CBP classified a “block type housing” for linear ball bearings, as a bearing housing in heading 8483, HTSUS, despite the fact that block housing was used to encase the ball bushings as they moved along the shaft. Accordingly, the fact that the wheel hub is a rotational device does not prevent this article from classification as a housed bearing. See NY 810222, dated June 5, 1995 (in which CBP classified a “roller end bearing” as a housed bearing in heading 8483, HTSUS, despite the fact that the roller end bearing of NY 810222 allowed the bearing to be mounted onto the end of a cylinder such that the cylinder rotated about a fixed axle).
Likewise, the fact that the subject merchandise does not fall within the commercial examples which you provided does not prevent its classification as a housed bearing in heading 8483, HTSUS. For example, NY 816229, dated December 5, 1995, CBP classified a “bracket” assembly as a housed bearing under 8483, HTSUS. In NY 816229, CBP stated that “the function of this “bracket” assembly is to support a rotating drive shaft on a bulldozer while reducing the resulting friction.” Hence, not only was the bracket assembly of NY 816229 not commercially recognized or referred to as a pillow block, flanged, take-up or hanger housed bearing, it also supported a rotational device, which like the subject wheel hub, was not stationary.
Classification as a Part
Whether the subject wheel hub assembly is classifiable as a “part” or as a “good”, is determined, in part by the application of Note 2 to Section XVI. Under Section XVI, Note 2 (a), a part can also be classifiable as a good and where that good is included in a heading of Chapter 84 or 85, the merchandise must be classified in its own respective heading. Housed bearings are provided for eo nomine in heading 8483, HTSUS and therefore by operation of Section XVI, Note 2(a), classification of a housed bearing under heading 8431 is precluded.
Likewise, even where an article is designed to work solely or principally as a part of a machine, a provision for parts does not prevail over a specific provision for such parts. In Nidec Corporation v. United States, 861 F. Supp. 136; (Ct. Int’l Trade 1994), aff'd. 68 F. 3d 1333 (Fed. Cir. 1995), the Court held that:
Note 2(b) provides that 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 are to be classified with the machines of that kind. The explanatory notes state that parts which are suitable for use solely or principally with particular machines or apparatus are classified in the same heading as those machines or apparatus. This statement, however, does not apply to parts which in themselves constitute an article covered by a heading of this section; these are in all cases classified in their own appropriate heading even if specifically designed to work as part of a specific machine.
CBP has found that where a wheel hub bearing has added functionality beyond the reduction of rotational friction and is principally or solely used as a part with the machine, that such item is classifiable as a part of the machine or item to which it is solely or principally used. For example, drive wheel hubs which are splinned (i.e. having gear teeth), have been classified as parts because the splinning is used to transmit the torque from the drive train to the wheel thus generating rotation in the tire drive axle. See NY 818084 dated February 7, 1996. (Which classified a hub unit for a drive axle as a part rather than merely a bearing). By contrast, NY M84091, dated June 29, 2006, classified a wheel hub assembly incorporating tapered roller bearings in heading 8483, HTSUS, as a housed bearing. The facts of NY M84091 indicate that the hub assembly was for a non-drive axle and therefore had no additional functionality beyond the reduction of rotational friction.
While the merchandise at issue is solely or principally used with the Genie articulating boom it serves no additional functionality beyond the reduction of friction. The wheel hub assembly fixes the position of the inserted bearings with respect to the wheel and axle in order to facilitate the reduction of rotational friction and support the axial load transferred. It is therefore not classifiable as a part but rather as a bearing, specifically, a housed bearing. As previously stated, the subject wheel hub is a hub for a non-drive axle, as the inner race is not splinned and therefore is unable to facilitate the transfer of torque. However, the wheel hub rotates around the axle, using the tapered bearings as the means to reduce the friction between the hub and the axle. As such, the function of the subject wheel hub is to reduce rotational friction and the fact that the subject merchandise is solely or principally used with a machine of heading 8427, does not alter that fact. Accordingly, classification of this item as a part of a machine would be inconsistent with the scope of heading 8483, HTSUS.
Anti-Dumping
In your submission, you query whether the instant merchandise is subject to the Anti-Dumping Duty Order on tapered roller bearings from the Republic of China. We note that whether the merchandise at issue is subject to antidumping orders is beyond the administrative authority of CBP. CBP is not charged with the administrative authority to ascertain nor impose antidumping orders or countervailing duties. Such authority is within the purview of the International Trade Administration, U. S. Department of Commerce (ITA).
HOLDING:
By application of GRI 1 and Note 2 (a) to Section XVI, we find that the instant wheel hub assembly is provided for in heading 8483, HTSUS, specifically, under subheading 8483.20.80, HTSUS, which provides for: “Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof: Housed bearings, incorporating ball or roller bearings: Flanged, take-up, cartridge and hanger units, Incorporating roller bearings: Other.” The 2009 column one, general rate of duty is 4.5% ad valorem.
EFFECT ON OTHER RULINGS:
HQ W968364, dated January 8, 2007, is hereby affirmed.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division