CLA-2: OT:RR:CTF:TCM H060579 MG
Laurie Peach
National Customs Manager
American Honda Motor Co., Inc.
1919 Torrance Boulevard
Torrance, CA 90501-2746
RE: Revocation of NY I84093, dated July 25, 2002; tariff classification of Honda automobile cylinder lock sets
Dear Ms. Peach:
This is in reply to your letter dated May 8, 2009, in which you have requested reconsideration of New York Ruling Letter (NY) I84093, dated July 25, 2002, as it pertains to the classification of two automotive cylinder lock sets (the “lock sets”) imported by American Honda. In accordance with your request for reconsideration of NY I84093, CBP has reviewed the classification of these items and has determined that the cited ruling is in error. For the reasons set forth in this ruling, we are revoking NY I84093. Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. §1625(c)(1)), as amended by section 623 of Title VI, a notice of proposed action was published on October 28, 2015, in the Customs Bulletin, Vol. 49, No. 43. No comments were received.
FACTS:
As detailed in the diagrams and pictures contained in your letter, the merchandise at issue are two lock sets used in the Honda Accord and the Honda Prelude, which consist of a lock assembly/ignition switch/wire harness that is packaged together with lock cylinders used in various locations on the vehicle and three identical keys that operate each of these locks.
According to your submission, part number 35010-SA6-674 is described in the Honda Parts Catalog as a “Lock Set, Cylinder” and is used for the 1982 Honda Accord. This lock set includes the following components: (1) One lock assembly/ignition switch/wire harness combination; (2) One lock cylinder for the glove box; (3) Two door lock cylinders; (4) One lock cylinder for the remote handle that operates the trunk release; (5) One lock cylinder for the fuel filler door; (6) One lock cylinder for the trunk; and (7) Three identical keys that operate each of the locks.
Part number 35010-SB0-674ZZ described in the Honda Parts Catalog as a “Lock Set, Cylinder” and is used for the 1985 Honda Prelude. This lock set includes the following components: (1) One lock assembly/ignition switch/wire harness combination; (2) One lock cylinder for the glove box; (3) Two door lock handles incorporating lock cylinders; (4) One lock cylinder for the remote handle that operates the trunk release; (5) One lock cylinder for the trunk; (6) One lock cylinder for the rear seat release mechanism; and (7) Three identical keys that operate each of the locks.
As stated in your letter, American Honda imports and packages all of the lock sets components in a single package and resells them to Honda automobile dealers as sets. This allows the automobile owner to change the locks on the vehicle, while ensuring that all locks operate from the same key.
In I84093, the components of the lock sets were separately classified. The lock assembly/ignition switch/wire harness was classified as a switch in heading 8536, Harmonized Tariff Schedule of the United States (HTSUS), as “Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, relays, fuses, surge suppressors, plugs, sockets, lamp-holders, junction boxes), for a voltage not exceeding 1,000 V.” The actual locks and articles containing locks and keys were classified in heading 8301, HTSUS, which provides for “Padlocks and locks (key, combination or electrically operated), of base metal; clasps and frames with clasps, incorporating locks, of base metal; keys and parts of any of the foregoing articles, of base metal.”
ISSUES:
1) Is the merchandise a set under GRI 3(b)?
2) If a set, is the essential character imparted by the locks and keys of heading 8301, HTSUS, or by the switch of heading 8436, HTSUS?
LAW AND ANALYSIS: Classification of goods under the HTSUS is governed by the GRI. GRI 1 provides that classification 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 GRI may then be applied.
The HTSUS provisions under consideration are as follows:
8301
Padlocks and locks (key, combination or electrically operated), of base metal; clasps and frames with clasps, incorporating locks, of base metal; keys and parts of any of the foregoing articles, of base metal:
8301.20.00
Locks of a kind used on motor vehicles….
8301.20.0060
Other
*
*
*
*
8536
Electrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, relays, fuses, surge suppressors, plugs, sockets, lamp-holders, junction boxes), for a voltage not exceeding 1,000 V; connectors for optical fibers, optical fiber bundles or cables:
8536.50
Other switches:
Other:
8536.50.90
Other:
8536.50.9065
Lamp-holders, plugs and sockets.
Inasmuch as the Lock Set is composed of goods that are prima facie classifiable in more than one heading, classification cannot be resolved under GRI 1. GRI 2(b) directs that the "classification of goods consisting of more than one material or substance shall be according to the principles of rule 3."
GRI 3 provides that:
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:
The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings refer to only part 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 the goods, even if one of them gives a more complete or precise description of the good.
Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
When goods cannot be classified by reference to 3(a) or 3(b), they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.
The headings at issue only refer to part of the items in the set put up for retail sale. As such, they are regarded as equally specific and resort must be made to GRI 3(b).
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the HTSUS. 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 the headings. It is Customs and Border Protection (CBP) practice to follow, whenever possible, the terms of the ENs when interpreting the HTSUS. See, T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
EN X to GRI 3(b) provides guidance as to whether the Lock Set constitutes “goods put up in sets for retail sale”:
For the purposes of this Rule, the term “goods put up in sets for retail sale” shall be taken to mean goods which:
(a) consist of at least two different articles which are, prima facie, classifiable in different headings . . .;
(b) consist of products or articles put up together to meet a particular need or carry out a specific activity; and
(c) are put up in a manner suitable for sale directly to users without repacking (e.g., in boxes or cases or on boards).
As previously explained, the items comprising the lock sets are prima facie classifiable under different headings of the HTSUS. In this regard, the circumstances of these lock sets are analogous to those of the lock set at issue in HQ H009850, dated January 15, 2009. In that ruling, CBP determined that the motorcycle lock set (comprised of an ignition cylinder attached to an ignition switch and contact base with wire harness, a locking gas cap, and a seat lock cylinder) met the requirements as a set as it “is intended for installation on a single motorcycle to meet the need of an owner to carry a single key that will operate multiple functions of the motorcycle, all of which require the use of a key,” explaining further that “[r]equiring the use of a key to access the ignition, gas tank and storage compartment provides the owner with security for the motorcycle,” and that “[t]he use of one key for accessing all three of these functions also fulfills the owner’s need for convenience, so that the owner is not obligated to carry multiple keys for each function.” CBP concluded that “[a]ccordingly, the Lock Set is put up together to meet an owner’s need for convenience and security, through the use of a single key.” In this regard, just like the motorcycle lock set, the instant lock sets are also put together to meet an owner’s need for convenience and security, through the use of a single key.
Finally, the lock sets satisfy the third requirement for treatment as “goods put up in sets for retail sale. At importation, the lock set is packaged in a box labeled with a singular part number which American Honda sells to Honda dealers in the same packaging. It has been a long-standing position of CBP that "there is no requirement that sets actually be sold at retail." In HQ 083968, dated July 6, 1989, CBP found that an installation kit comprised of a variety of retaining clips, hoses, clamps, brackets, connectors, tee fittings, fuel line covers and valve covers with gaskets, and delivered directly to an automobile dealer for installation into a recalled vehicle free of charge was "put up in a manner suitable for sale directly to users" and was therefore classifiable as a set (all other conditions being satisfied). See, HQ H011015, dated July 28, 2008. In sum, as with the Lock Set at issue in HQ H009850, the Cylinder Lock Sets qualify as “goods put up in sets for retail sale” under GRI 3(b).
Because the three criteria under EN X to GRI 3(b) are satisfied, the three items are considered '’goods put up in sets for retail sale” and will be “classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.”
Explanatory Note VIII to GRI 3(b) explains, "[t]he factor which determines essential character will vary as between different kinds of goods. It may, for example, be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of the constituent material in relation to the use of the goods."
We stated in HQ H009850 that the principal reason for purchasing the lock set is to obtain three items that utilize the same key and that the common feature in all three “distinct articles” is the locking mechanism. In this regard, CBP classified the three articles incorporating the lock mechanism, rather than classifying divergent articles as locks. The reasoning in that ruling is that each of the distinct articles provide different purposes, none of which is more important than the others and, therefore, the set was not classifiable on the basis of its essential character by reference to GRI 3(b), but in accordance with GRI 3(c) under Heading 8714, HTSUS, which was last in numerical order.
Unlike the situation in HQ H009850, where the lock cylinders were integrated, each of the instant lock sets includes one wire harness assembly, six separate locks and three keys (which are classified with the locks). Therefore, taken together, the locks impart the essential character to these sets. They are greater in number, bulk and likely value. They also play a greater role in relation to the use of the good in that they are the actual lock.
Accordingly, by application of GRI 3(b), lock set 35010-SA6-674 for the 1982 Honda Accord and lock set 35010-SB0-674ZZ for the 1985 Honda Prelude are classified in heading 8301, HTSUS. They are specifically provided for in subheading 8301.20.0060, HTSUSA (Annotated), which provides for: “Padlocks and locks (key, combination or electrically operated), of base metal; clasps and frames with clasps, incorporating locks, of base metal; keys and parts of any of the foregoing articles, of base metal: Locks of a kind used on motor vehicles….: Other.”
HOLDING:
By application of GRI 3(b), lock set 35010-SA6-674 for the 1982 Honda Accord and lock set 35010-SB0-674ZZ for the 1985 Honda Prelude the Cylinder Lock Sets are classified in heading 8301, HTSUS. It is specifically provided for in subheading 8301.20.0060, HTSUSA, which provides for: “Padlocks and locks (key, combination or electrically operated), of base metal; clasps and frames with clasps, incorporating locks, of base metal; keys and parts of any of the foregoing articles, of base metal: Locks of a kind used on motor vehicles….: Other.” The general, column one rate of duty is 5.7, ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web, at http://www.usitc.gov.tata/hts/.
EFFECT ON OTHER RULINGS:
NY I84093, dated July 25, 2002, is hereby REVOKED.
In accordance with 19 U.S.C. 1625 (c), this ruling will become effective 60 days after its publication in the Customs Bulletin.
Sincerely,
Joanne Roman Stump
Acting Director, Commercial and Trade Facilitation Division