CLA-2 OT:RR:CTF:TCM H033596 CkG
TARIFF NO: 8428.90.01
Port Director
U.S. Customs and Border Protection
Port of Otay Mesa
9777 Via de la Amistad
San Diego, California 92154
RE: Internal Advice #08/016; classification of iron roughneck
Dear Port Director:
This letter is in reply to your memorandum forwarding Request for Internal Advice
#08/016, dated July 8, 2008, initiated on behalf of National Oilwell Varco, L.P. (Varco).
At issue is the classification by U.S. Customs and Border Protection (CBP) of an iron
roughneck under the Harmonized Tariff Schedule of the United States (HTSUS). We
have also taken into consideration the importer’s submission dated October 6, 2009.
FACTS
The subject article, known as an “iron roughneck,” model ST-80C, is a machine used in oil and gas drilling rigs for connecting and disconnecting drilling well pipes. The device is comprised of a carriage and a pedestal. The pedestal can be lowered or raised to adjust the height of the device. The carriage is a heavy-duty enclosure for the remaining components of the iron roughneck, and incorporates two hydraulic jaws, manipulated via scissor arms. The hydraulic jaws in turn contain a combination spinner and torque wrench. The upper and lower jaws each grip and spin a pipe, thus fitting the two pipes together or disconnecting them. While spinning the top pipe, the roughneck also lowers it onto/aligns it with the pipe below. A control console built in to the front of the carriage is used to operate the device.
ISSUE:
Whether the subject merchandise is classifiable in heading 8428, HTSUS, as
“Other lifting, handling, loading or unloading machinery,” heading 8430, HTSUS, as
“Other moving, grading, leveling, scraping, excavating, tamping, compacting, extracting or boring machinery, for earth, minerals or ores,” or heading 8479, HTSUS, as a machine having individual functions not elsewhere specified.
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 2008 HTSUS provisions under consideration are:
8428 Other lifting, handling, loading or unloading machinery (for example, elevators, escalators, conveyors, teleferics):
8428.90.01 Other machinery….
* * * * *
8430: Other moving, grading, leveling, scraping, excavating, tamping, compacting, extracting or boring machinery, for earth, minerals or ores; pile-drivers and pile-extractors, snowplows and snowblowers.
Other boring or sinking machinery:
8430.49: Other:
8430.49.80: Other:
* * * * *
8479: Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof:
Other machines and mechanical appliances:
8479.89: Other:
8479.89.98: Other….
* * * * *
The Explanatory Notes (ENs) to the Harmonized Commodity Description and Coding System represent the official interpretation of the tariff at the international level. While neither 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, 35128 (August 23, 1989).
EN 84.28 provides, in pertinent part, as follows:
With the exception of the lifting and handling machinery of headings 84.25 to 84.27, this heading covers a wide range of machinery for the mechanical handling of materials, goods, etc. (lifting, conveying, loading, unloading, etc.). They remain here even if specialised for a particular industry, for agriculture, metallurgy, etc.
(III) OTHER SPECIAL LIFTING OR HANDLING MACHINERY
Auxiliary mechanical appliances for manipulating pneumatically,
hydraulically or electrically operated hand tools (drills, hammers,
etc.). These appliances help to support the tool or push it forward into the
work, e.g., pneumatically operated tool supports and pushers; drilling rigs
and carriages (“ Jumbos ”); mechanical “ balancers ” for suspending tools
during working. But the heading excludes simple static supports, etc.
(E) Industrial robots specifically designed for lifting, handling, loading or
unloading.
(H) Mechanical remote control manipulators, for radioactive products, fixed or mobile, consisting of an arm outside the shielded cell, which is guided manually, and an arm inside the cell, which reproduces the operator’s movements. Transmission of the movements is by means of mechanical, hydraulic or pneumatic appliances or by electric pulses.
EN 84.79 provides, in pertinent part, as follows:
This heading is restricted to machinery having individual functions, which:
(a) Is not excluded from this Chapter by the operation of any Section or
Chapter Note.
and (b) Is not covered more specifically by a heading in any other Chapter of
the Nomenclature.
and (c) Cannot be classified in any other particular heading of this Chapter
since:
No other heading covers it by reference to its method of
functioning, description or type.
and (ii) No other heading covers it by reference to its use or to the
industry in which it is employed.
or (iii) It could fall equally well into two (or more) other such
headings (general purpose machines).
The machinery of this heading is distinguished from the parts of machinery, etc.,
that fall to be classified in accordance with the general provisions concerning
parts, by the fact that it has individual functions.
For this purpose the following are to be regarded as having “individual functions”:
(A) Mechanical devices, with or without motors or other driving force, whose function can be performed distinctly from and independently of any other machine or appliance.
(B) Mechanical devices which cannot perform their function unless they are mounted on another machine or appliance, or are incorporated in a more complex entity, provided that this function:
is distinct from that which is performed by the machine or appliance whereon they are to be mounted, or by the entity wherein they are to be incorporated, and
(ii) does not play an integral and inseparable part in the
operation of such machine, appliance or entity.
* * * * *
The importer initially suggested classification in heading 8430, HTSUS, as other moving, extracting or boring machinery. The importer’s supplemental submission of October 6, 2009, requests classification in heading 8428, HTSUS, as lifting or handling machinery. It is the Port’s position that the device is classifiable under heading 8479, HTSUS, which provides for “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof.”
Heading 8430, HTSUS, is not an appropriate classification for the iron roughneck. Heading 8430, HTSUS, covers machinery that “attacks the earth’s crust” or otherwise prepares/compacts terrain. See EN 84.30. EN 84.30(D) further states that: “This heading covers only drilling machines as such. Other quite distinct machines normally used therewith are excluded even if presented with the drilling machines, e.g., pumps and compressors to force mud, stone, etc. out of the drilling.” The ST-80C does not perform the actions described in the heading or explanatory notes, but is merely a tool used to connect or disconnect components of a machine actually used for drilling.
Because the iron roughneck is used to manipulate drilling pipes, we must
also consider whether it is provided for in heading 8428, HTSUS, as lifting or handling machinery. Neither “lifting machinery” nor “handling machinery” is defined in the text of the HTSUS or in the ENs. In such cases, "the term's correct meaning is its common meaning." Mita Copystar Am. v. United States, 21 F.3d 1079, 1082 (Fed. Cir. 1994). The common meaning of a term used in commerce is presumed to be the same as its commercial meaning. Simod Am. Corp. v. United States, 872 F.2d 1572, 1576 (Fed. Cir. 1989). The Merriam-Webster Dictionary defines a “machine” as follows:
e (1) : an assemblage of parts that transmit forces, motion and energy one to another in a predetermined manner (2) : an instrument (as a lever) designed to transmit or modify the application of power, force or motion f: a mechanically, electrically, or electronically operated device for performing a task.
See http://www.merriam-webster.com/dictionary/machine. The Cambridge Advanced Learner’s Dictionary defines “handle” as follows: “to pick something up and touch, hold or move it with your hands.” See http://dictionary.cambridge.org/define.asp?key= 35542&dict=CALD&topic=touching-and-feeling. The Compact Oxford English Dictionary similarly defines “handle” as “to feel or manipulate with the hands.” See http://www.askoxford.com/concise_oed/handle?view=uk. The ENs to heading 8428, HTSUS, further explain that machines of this heading are for the mechanical handling of goods and materials. Examples include auxiliary mechanical appliances for manipulating pneumatically, hydraulically or electrically operated hand tools, industrial robots, and mechanical remote control manipulators.
“Handling machinery” of heading 8428, HTSUS, thus engages in the manipulation of objects via mechanical means, for example by mechanical arms. The function of the iron roughneck is to connect and disconnect drill pipes. In order to accomplish this, the hydraulic jaws of the iron roughneck grip the pipes, turn the top and bottom pipes in opposite directions, and lower the top pipe to “spin in” or “spin out” the connection. The function of the iron roughneck is thus, in essence, to handle pipes. This function falls within the scope of heading 8428, HTSUS, which provides for, inter alia, handling machinery. Furthermore, the iron roughneck is comparable to handling and manipulating machines such as industrial robots, machines for the manipulation of hand tools, and mechanical remote control manipulators, all provided for in the EN to heading 8428, HTSUS. CBP has also classified comparable machines such as hydraulic arms (HQ 953543, dated April 15, 1993) and industrial robots (NY E87651, dated October 1, 1999), in this heading. In HQ 966472, dated November 25, 2003, CBP also classified several handling devices used to supplement or replace the standard fork of a forklift truck in heading 8428, HTSUS. Among these were a fork positioner, used to adjust the distance between the forks to match the width of the object being handled, and a rotator, which gives the forklift operator the ability to rotate the fork mechanism 360 degrees in either direction in order to quickly dump or invert a load. Both devices are comparable to the iron roughneck in that they handled and positioned the forks without actually lifting, loading or unloading goods themselves.
Because the iron roughneck is specified elsewhere in the HTSUS, it is not classifiable in heading 8479, HTSUS.
HOLDING:
By application of GRI 1, the ST-80C iron roughneck is classifiable in heading
8428, HTSUS, specifically subheading 8428.90.01, HTSUS, which provides for “Other lifting, handling, loading or unloading machinery (for example, elevators, escalators, conveyors, teleferics): Other machinery.” The 2008 column one, general rate of duty is Free.
You are to mail this decision to the internal advice requester no later than 60
days from the date of the decision. At that time, the Office of International Trade,
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.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division