CLA-2 OT:RR:CTF:TCM H136116 EG
Frank Gomez
President
World Exchange, Inc.
8840 Bellanca Ave.
Los Angeles, CA 90045
RE: Classification of Nomad Portable Solar Panel Arrays and Sherpa Power Packs
Dear Mr. Gomez:
This is in response to your request of October 4, 2010, on behalf of Goal Zero, for a binding ruling on the tariff classification of the Nomad 13.5M Portable Solar Panel Array, the Nomad 27M Portable Solar Panel Array, the Nomad 7M Portable Solar Panel Array with a USB Charging Port, the Sherpa 50 Power Pack and the Sherpa 120 Power Pack under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
The five subject articles are discussed below.
The Nomad 13.5M Portable Solar Panel Array
The Nomad 13.5M is a 13.5 watt mono-crystalline solar array comprised of four small solar panels secured inside a portable and foldable nylon case. Attached to the Nomad 13.5M is a charging cable which plugs into electronic devices and charges them using power generated by the solar panels. Also attached to the Nomad 13.5M is a “chain port” which allows it to be chained to other Goal Zero power products, such as the Goal Zero Sherpa power packs, for additional charging power.
The Nomad 27M Portable Solar Panel Array
The Nomad 27M is a 27 watt mono-crystalline solar array comprised of eight small solar panels secured inside a portable and foldable nylon case. Attached to the Nomad 27M is a charging cable which plugs into electronic devices and charges them using power generated by the solar panels. The nylon case also includes a pocket which holds three short aluminum support rods. These support rods can be inserted into small sleeves of the Nomad 27M’s nylon case to provide more rigidity when it is laid out to collect solar energy.
The Nomad 7M Portable Solar Panel Array with a USB Charging Port
The Nomad 7M is a 7 watt mono-crystalline solar array comprised of two small solar panels secured inside a portable and foldable nylon case. The Nomad 7M has two charging ports: a 5 volt (V) USB output port and a 12V direct current (DC) output port. The casing which encloses the charging ports includes a DC to DC converter. Packaged with the Nomad 7M is 12V vehicle cigarette lighter adapter.
The Sherpa 50 Power Pack
The Sherpa 50 Power Pack is a rechargeable lithium battery which stores 50 watt-hours of power. The battery is encased in a plastic housing that features a power button, an LCD monitor display, an indicator light, an input socket (DC 15.3V), a USB port (DC 5V) and an output socket (DC 12V). For the USB port, there is an internal DC to DC converter which converts 12V to 5V.
Included with the Sherpa 50 are the following: a power cord, an alternating current (AC)/DC adapter, a vehicle cigarette lighter adapter, a textile strap to secure it to another Sherpa Power Pack and a chain cable to connect it to another Sherpa Power Pack.
The Sherpa 120 Power Pack
The Sherpa 120 Power Pack is a rechargeable lithium battery which stores 120 watt-hours of power. The battery is encased in a plastic housing that features a power button, an LCD monitor display, an indicator light, an input socket (DC 15.3V), a USB port (DC 5V) and an output socket (DC 12V). For the USB port, there is an internal DC to DC converter which converts 12V to 5V.
Included with the Sherpa 120 battery are the following: a power cord, an AC/DC adapter, a vehicle cigarette lighter adapter, a textile strap to secure it to another Sherpa battery and a chain cable to connect it to another Sherpa battery.
Representative samples of each of these items were furnished for classification purposes and are being returned to you as per your request.
ISSUES:
1. Are the Nomad Portable Solar Panel Arrays classifiable under heading 8501, HTSUS, which provides for electric generators or under heading 8541, HTSUS, which provides for photosensitive semiconductor devices?
2. Are the Sherpa Power Packs classifiable under heading 8504, HTSUS, as electric converters or under heading 8507, HTSUS, as electric storage batteries?
3. If a Sherpa Power Pack and a Nomad Portable Solar Panel Array are imported together, would they be classified together as a set pursuant to GRI 3(b)? If so, what would be the proper tariff classification of such a set?
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.
GRI 3 provides as follows:
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:
(a) The heading which provides the most specific description shall be preferred to headings providing a more general description. However, when two or more headings each refer to part only 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 those goods, even if one of them gives a more complete or precise description of the goods.
(b) 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.
(c) 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 HTSUS provisions under consideration are as follows:
8501 Electric motors and generators (excluding generating sets) …
* * *
8504 Electrical transformers, static converters (for example, rectifiers) and inductors; parts thereof …
* * *
8507 Electric storage batteries, including separators therefor, whether or not rectangular (including square) …
* * *
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 ….
* * *
Legal Note 3 to Section XVI (which contains Chapter 85) states that:
Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that machine which performs the principal function.
* * *
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the HTSUS. While not legally binding or 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).
The ENs to GRI 3(b) provide in pertinent part that:
In all these cases the goods are to be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.
The 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 a constituent material in relation to the use of the goods.
***
(X) 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. Therefore, for example, six fondue forks cannot be regarded as a set within the meaning of this Rule;
(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).
* * *
EN(VI) to Section XVI states in pertinent part that:
Where it is not possible to determine the principal function, and where, as provided in Note 3 to [Section XVI], the context does not otherwise require, it is necessary to apply General Interpretative Rule 3 (c); such is the case, for example, in respect of multi function machines potentially classifiable in several of the headings 84.25 to 84.30, in several of the headings 84.58 to 84.63 or in several of the headings 84.69 to 84.72.
***For the purposes of [Note 3 to Section XVI], machines of different kinds are taken to be fitted together to form a whole when incorporated one in the other or mounted one on the other, or mounted on a common base or frame or in a common housing.
* * *
EN 85.01 provides, in pertinent part:
(II) ELECTRIC GENERATORS
Machines that produce electrical power from various energy sources (mechanical, solar, etc.) are classified here [in heading 8501], 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.
In these devices, electricity is produced by means of solar cells which convert solar energy directly into electricity (photovoltaic conversion).
* * *
EN 85.04 provides, in pertinent part:
(II) ELECTRICAL STATIC CONVERTERS
The apparatus of this group are used to convert electrical energy in order to adapt it for further use. They incorporate converting elements (e.g., valves) of different types.
*** This group includes :
*** (D) Direct current converters by which direct current is converted to a different voltage.
* * *
EN 85.41 provides, in pertinent part:
(B) 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:
*** (2) 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).
* * *
Classification of the Nomad Portable Solar Panel Arrays
Nomad 13.5M
Goal Zero posits that the Nomad 13.5M is classifiable under heading 8541, HTSUS, because it consists of four small panels of photovoltaic cells. According to EN 85.41(B)(2), solar cells are a type of photovoltaic cells which convert sunlight directly into electricity. However, EN 85.41(B)(2)(i) states that 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).” Attached to the Nomad 13.5M is a charging cable which plugs directly into electrical apparatus, e.g. a cellular telephone, and charges the apparatus using electricity generated by its solar cells. As such, the Nomad 13.5M cannot be classified under 8541, HTSUS.
Heading 8501, HTSUS, provides for electric generators. EN 85.01(II) states that electric generators are “machines that produce electrical power from various energy sources (mechanical, solar, etc.).” The EN further states that “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.” The Nomad 13.5M produces electrical power from its panels of photocells. It is equipped with a charging cable which directly supplies power to external electrical apparatus. As such, the Nomad 13.5M is classified in heading 8501, HTSUS, as an electric generator.
ii. Nomad 27M
The Nomad 27M is imported in a retail package together with three small aluminum rods. The Nomad 27M is classifiable in Chapter 85 as an electric generator. The aluminum rods are classifiable in Chapter 76 as articles of aluminum. Because the two articles are prima facie classifiable in separate headings, GRI 3 will apply to the classification of the Nomad 27M as imported.
Under GRI 3(a), we must classify the Nomad 27M and the aluminum rods together under the more specific heading, unless each heading only refers to one component. Since each heading only refers to one component we must proceed to GRI 3(b).
GRI 3(b) covers mixtures, composite goods and goods put up in sets for retail sale. EN(X) to GRI 3(b) defines “goods put up in sets for retail sale” as 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 packaged, the Nomad 27M meets this definition because it includes the foldable solar panels and aluminum rods which are packaged together to facilitate capturing sunlight to create electricity.
Under GRI 3(b), retail sets must be classified according to the article which gives the retail set its essential character. In order to identify a set’s essential character, the U.S. Court of International Trade has applied the factors listed in the ENs to GRI 3(b) which are “the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the goods.” The Home Depot v. United States, 427 F. Supp. 2d 1278, 1293 (Ct. Int’l Trade 2006). With regard to the role of the article which imparts the essentical character, the court has stated it is “that which is indispensable to the structure, core or condition [of the retail set].” Id. citing A.N. Deringer, Inc. v. United States, 66 Cust. Ct. 378, 383 (1971). The role of the Nomad 27M is to capture solar rays and convert those rays into electricity. The aluminum rods merely provide support to the Nomad 27M so that it can completely spread out and face the sun. The Nomad 27M provides the core purpose to the set. Therefore, the Nomad 27M provides the essential character and the set must be classified according to the Nomad 27M’s classification.
The Nomad 27M is very similar to the Nomad 13.5M. They are both collections of photovoltaic cells in panels. The panels are attached to foldable nylon cases. Attached to both articles are charging cables which plug directly into external electronic apparatus. As such, the Nomad 27M is also classified in heading 8501, HTSUS, as an electric generator.
iii. Nomad 7M
The Nomad 7M is slightly different from the Nomad 27M and the Nomad 13.5M. The Nomad 7M includes two charging ports: a 5V USB output port and a 12V direct current (DC) output port. The casing which encloses the charging ports includes a DC to DC converter. The Nomad 7M also includes a separate vehicle cigarette lighter adapter.
For the reasons articulated above in our analysis of the Nomad 13.5M and the Nomad 27M, the Nomad 7M is classified under heading 8501, HTSUS, as an electric generator. We note that the Nomad’s built-in voltage converter does not render it beyond the scope of heading 8501, HTSUS. The heading for electric generators covers generators even when they are equipped with apparatus such as voltage regulators in order to supply power directly to external devices. See EN 85.01(II). The Nomad is packaged together with a vehicle cigarette lighter adapter classifiable in heading 8544, HTSUS, as an electric insulated conductor fitted with connectors. See New York Ruling Letter (NY) A80143, dated March 5, 1996 and NY N053435, dated March 13, 2009 (both classifying vehicle cigarette lighter adapters in heading 8544, HTSUS).
Because the Nomad 7M and the adapter are classifiable in separate headings, GRI 3 will apply to their classifications. Under GRI 3(a), since each heading only covers one but not both articles, we must proceed to GRI 3(b). The Nomad 7M and the adapter constitute a GRI 3(b) set because a) they consist of at least two different articles which are classifiable in different headings, b) they consist of products or articles put up together to meet the particular need of charging 12V and USB devices while traveling and c) they are packaged together for retail sale.
As indicated above, under GRI 3(b), retail sets are classified according to the article which gives the set its essential character. An item’s essential character is determined by examining each article’s role, bulk, quantity, weight and value. With respect to the set at issue, we note that the Nomad 7M is the component that generates electricity, which is the reason why a consumer would purchase the article. It is also more expensive than the vehicle cigarette lighter adapter. For these reasons, the Nomad 7M imparts the essential character to the set. The entire set is classified under heading 8501, HTSUS, as an electric generator.
Classification of the Sherpa Power Packs
The Sherpa Power Packs are composite machines pursuant to Legal Note 3 to Section XVI. They consist of a lithium battery and a DC to DC converter encased in a plastic housing. Batteries are provided for in heading 8507, HTSUS. The DC to DC converter is provided for in heading 8504, HTSUS. The battery stores power and the converter changes the voltage of the electric current so that it can directly connect to and charge USB and 12V devices. Legal Note 3 states that composite machines “are to be classified as if consisting only of that component or as being that machine which performs the principal function.” We find in this case that the Sherpas’ two functions are both equally important to their purpose of storing power and charging external apparatus. Therefore, as their principal function cannot be determined, we turn to GRI 3(c). See EN(VI) to Section XVI (“where it is not possible to determine the principal function, and where, as provided in Note 3 to the Section, the context does not otherwise require, it is necessary to apply [GRI] 3 (c).”). GRI 3(c) states that “when goods cannot be classified ... [by Legal Note 3], they shall be classified under the heading which occurs last in numerical order among those which equally merit consideration.” Accordingly, the entire Sherpa Power Pack will be classified as a battery under heading 8507, HTSUS, because it occurs last in numerical order.
The Sherpas are imported in a package for retail sale together with several other articles. In order to classify them in their condition as imported, we must look at all the contents of the retail package. Therefore, we will look to GRI 3 to classify the Sherpa packages.
The articles in the Sherpa package satisfy the requirements for a retail set because a) they are classifiable in separate headings, i.e., the AC/DC adapter in heading 8504, HTSUS and the Sherpa Power Pack in heading 8507, HTSUS, b) all of articles are sold together to facilitate charging electrical apparatus while traveling and c) the articles are packaged together for retail sale. The Sherpa Power Pack provides the essential character because it stores electricity and charges electronic devices when the consumer travels into the wilderness. Moreover, the Sherpa Power Pack is a great deal larger and more expensive than the power cord, the AC/DC adapter, the vehicle cigarette lighter adapter, the textile strap and the chain cable. Thus, the entire set is classified under heading 8507, HTSUS, as a battery.
Classification of the Sherpa and Nomad Solar Panel Imported Together
You have asked us to provide the tariff classification of a Sherpa Power Pack and a Nomad Solar Panel imported together. However, you did not provide samples of such a package. If the Sherpa Power Pack and the Nomad Solar Panel are imported together but in separate retail packaging, each good must be classified in their respective headings (i.e., the Nomad in heading 8501, HTSUS and the Sherpa in heading 8507, HTSUS).
The Sherpa Power Pack and the Nomad Solar Panel would constitute a retail set if packaged together for retail sale because a) they are classifiable in separate headings, b) they work together to charge electrical devices in the wilderness and c) the articles are packaged together for retail sale. The Nomad Solar panel generates electricity and charges electrical devices. The Sherpa Power Pack stores electricity and charges electrical devices. Since both functions are equally important, we cannot determine which article provides the essentical character to the set. Therefore, since the Nomad is classified as an electric generator under heading 8501, HTSUS, and the Sherpa is classified as a battery under heading 8507, HTSUS, the entire package will be classified as a battery under heading 8507, HTSUS, because it occurs last in numerical order.
HOLDING:
By application of GRI 1, the Nomad 13.5M is classified as an electric generator under heading 8501, HTSUS. It is specifically provided for under subheading 8501.31.80, HTSUS, which provides for “Electric motors and generators (excluding generating sets): other DC motors; DC generators: of an output not exceeding 750W: generators…” The 2011 column one, general rate of duty is 2.5% ad valorem.
By application of GRI 3(b), the Nomad 27M package and the Nomad 7M package are classified as electric generators under heading 8501, HTSUS. They are specifically for under subheading 8501.31.80, HTSUS, which provides for “Electric motors and generators (excluding generating sets): other DC motors; DC generators: of an output not exceeding 750W: generators…” The 2011 column one, general rate of duty is 2.5% ad valorem.
By application of GRI 3(b), the Sherpa Power Packages are both classified under heading 8507, HTSUS, as batteries. They are specifically provided for under subheading 8507.80.80, HTSUS, as “Electric storage batteries, including separators therefore, whether or not rectangular (including square); parts thereof: other storage batteries: other…” The 2011 column one, general rate of duty is 3.4% ad valorem.
By application of GRI 3(c), a Nomad Solar Panel packaged together with a Sherpa Power Pack for retail sale is classified under heading 8507, HTSUS, as a battery. It is specifically provided for under subheading 8507.80.80, HTSUS, as “Electric storage batteries, including separators therefore, whether or not rectangular (including square); parts thereof: other storage batteries: other…” The 2011 column one, general rate of duty is 3.4% 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 World Wide Web at http://www.usitc.gov/tata/hts/.
Sixty days from the date of the decision the Office of International Trade 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.
A copy of this ruling letter should be attached to the entry documents filed
at the time the goods are entered. If the documents have been filed without a copy, this
ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Ieva K. O’Rourke, Chief
Tariff Classification and Marking Branch