CLA-2 OT:RR:CTF:TCM H084604 RM
Jefferey M. Young, Esq.
Moore & Van Allen, PLLC
P.O. Box 13706
Research Triangle Park, NC 27709
RE: Revocation of New York Ruling Letter N047472; Tariff Classification of the Trinasolar TSM-175D Solar Module
Dear Mr. Young:
This is in reference to New York Ruling Letter (“NY”) N047472, dated January 9, 2009, issued to you on behalf of GES USA, Inc., concerning the tariff classification of the Trinasolar TSM-175D solar module. In that ruling, U.S. Customs and Border Protection (“CBP”) classified the merchandise under heading 8501 of the Harmonized Tariff Schedule of the United States (“HTSUS”), as an electric generator. We have reviewed that ruling and found it to be incorrect. For the reasons set forth below, we intend to revoke NY N047472.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. §1625(c)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed revocation was published on March 31, 2010, in the Customs Bulletin, Volume 44, No. 14. No comments were received in response to this notice.
FACTS:
Trinasolar’s TSM-175D solar module is comprised of 72 monocrystalline silicon photovoltaic (“PV”) cells and a junction box. The cells are arranged in three, 24-cell strings, and are encapsulated between a sheet of tempered glass and a polymer backing. The junction box is attached to the rear of the module. It houses terminals to connect the strings of cells together, cables and connectors for external wiring, and 3 bypass diodes (one for each string) to protect the cells from overheating when shaded. The module can generate a maximum of 175 watts.
Under normal conditions with no shading, every cell on the module will generate power and the bypass diodes will be inactive. However, if part of the module becomes shaded (e.g., by a leaf or an antenna), the shaded cells will cease to generate power and will instead consume the energy produced by the active cells. Left unattended, the shaded cells would eventually overheat and deteriorate.
Bypass diodes protect the shaded cells from overheating by diverting the electrical current around strings with shaded cells and through an external circuit. As illustrated above, when part of the module becomes shaded, the bypass diode wired in parallel to the string with shaded cells will conduct current. As a result, the current will flow through the diode and around the shaded string. In turn, the module will continue to produce electricity, albeit at a reduced rate.
ISSUE:
Is the Trinasolar TSM-175D solar module classified under heading 8541, HTSUS, as a photosensitive semiconductor device, or under heading 8501, as an electric generator?
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 2010 HTSUS provisions under consideration are the following:
8501 Electric motors and generators (excluding generating sets):
Other DC motors; DC generators:
Of an output not exceeding 750 W:
8501.31.80 Generators …
8541 Diodes, transistors and similar semiconductor devices; photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels; light-emitting diodes; mounted piezoelectric crystals; parts thereof:
8541.40 Photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up in panels; light-emitting diodes:
8541.40.60 Other diodes …
* * *
Note 2 to Chapter 85, HTSUS, provides, in part:
Headings 8501 and 8504 do not apply to goods described in heading …8541.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System at the international level. 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, 35128 (August 23, 1989).
EN 85.01 provides, in pertinent part:
ELECTRICAL GENERATORS
Machines that produce electrical power from various energy sources (mechanical, solar, etc.) are classified here, provided they are not more specifically covered by any other heading of the Nomenclature.
… The heading also covers photovoltaic generators consisting of panels of photocells combined with other apparatus, e.g., storage batteries and electronic controls (voltage regulator, inverter, etc.) and panels or modules equipped with elements, however simple (for example, diodes to control the direction of the current), which supply the power directly to, for example, a motor, an electrolyser.
EN 85.41 provides, in pertinent part:
PHOTOSENSITIVE SEMICONDUCTOR DEVICES
This group comprises photosensitive semiconductor devices in which the action of visible rays, infra-red rays or ultra-violet rays causes variations in resistivity or generates and electromotive force, by the internal photoelectric effect.
* * *
The main types of photosensitive semiconductor devices are:
Photovoltaic cells, which convert light directly into electrical energy without the need for an external source of current. […]
Special categories of photovoltaic cells are:
(i) Solar cells, silicon photovoltaic cells which convert sunlight directly into electric energy. They are usually used in groups such as source of electric power, e.g., in rockets or satellites employed in space research, for mountain rescue transmitters.
The heading also covers solar cells, whether or not assembled in modules or made into panels. However the heading does not cover panels or modules equipped with elements, however simple, (for example, diodes to control the direction of current), which supply the power directly to, for example, a motor, an electrolyser (heading 85.01).
* * *
Photosensitive semiconductor devices fall in this heading whether presented mounted (i.e., with their terminals or leads), packaged or unmounted.
* * *
In NY N047472, CBP classified the subject module under heading 8501, HTSUS, as an electric generator. Paraphrasing EN 85.41(B)(2)(i), as follows “… heading 8541 does not cover panels or modules equipped with elements, however simple, i.e., diodes to control the direction of the current”, we reasoned that the module was beyond the scope of heading 8541, HTSUS, because it contains bypass diodes.
Heading 8541, HTSUS, provides for “Photosensitive semiconductor devices, including photovoltaic cells … assembled in modules.” EN 85.41(B) explains that photosensitive semiconductor devices are those “in which the action of visible rays, infra-red rays or ultra-violet rays causes variations in resistivity … by the internal photoelectric
effect.” The EN adds that the heading includes PV cells assembled into modules, even if “presented mounted (i.e. with their terminals or leads),” provided they are not “equipped with elements, however simple (for example, diodes to control the direction of the current), which supply the power directly to, for example, a motor, an electrolyser." (Emphasis added).
At the outset, we note that a solar module is not precluded from classification under heading 8541, HTSUS, simply because it contains “elements” (e.g., diodes which control the direction of the current). Those elements must also “supply power directly” to an external load, such as a motor or an electrolyser. See EN 85.41(B)(2)(i).
The Trinasolar TSM-175D solar module is “presented mounted” (i.e., with its terminals and external cables and connectors), and includes three bypass diodes to protect it from overheating. See EN 85.41(B)(2)(i). The diodes achieve this function by controlling the direction of the current that flows through the module. They do not “supply power directly” to an external load. In fact, our research indicates that solar modules are very rarely used to supply power directly to a device. The vast majority of applications require that the DC produced by the module be converted into alternating current (“AC”) by an inverter. Therefore, as the subject module is not equipped with elements which supply power to an external load, we find that it is classified under heading 8541, HTSUS, as a photosensitive semiconductor device.
Pursuant to Note 2 to Chapter 85, HTSUS, as the module is described by heading 8541, HTSUS, it is precluded from classification under heading 8501, HTSUS. Our conclusion is in accord with NY 866046, dated May 21, 1993, wherein CBP classified a solar module equipped with wired-in bypass diodes under heading 8541, HTSUS.
HOLDING:
By application of GRI 1, the Trinasolar TSM-175D solar module is classified under heading 8541, HTSUS, specifically in subheading 8541.40.60, which provides for: “Photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up into panels …: Photosensitive semiconductor devices, including photovoltaic cells whether or not assembled in modules or made up in panels …: Other diodes.” The 2010, column one, general rate of duty is: Free.
EFFECT ON OTHER RULINGS:
NY N047472, dated January 9, 2009, is hereby revoked. In accordance with 19 U.S.C. § 1625(c), this action will become effective 60 days after publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division