CLA-2 OT:RR:CTF:TCM H181680 EGJ
Port Director
U.S. Customs and Border Protection
Edward H. McNamara Terminal
2596 Worldgateway Place
Detroit, MI 48242
Attn: Liza Politano, Senior Import Specialist
RE: Application for Further Review of Protest No. 3801-11-100139; Classification of a Metal Bellows Assembly Machine and Three Work Holders
Dear Port Director:
This is in response to the Application for Further Review (AFR) of Protest No. 3801-11-100139, dated April 5, 2011, filed on behalf of Witzenmann USA LLC (Witzenmann). Witzenmann filed this AFR in response to your classification of a metal bellows assembly machine and three work holders under the Harmonized Tariff Schedule of the United States (HTSUS).
FACTS:
Witzenmann manufactures different parts for motor vehicles. One item in the Witzenmann line of products is a double-walled, braided metal bellows. It is a component of the motor vehicle’s exhaust system. A picture of a double-walled, braided metal bellows from the Witzenmann website (www.witzenmann.com) is provided below:
Witzenmann imports several machines which fit together to form the manufacturing and assembly line for this metal bellows. Per the AFR, the first machine pulls two different coils of narrow steel strip into two different sides of the machine. Each side of the machine forms the strip into a tube using a curling and welding process. The second machine in the assembly line inserts the smaller diameter tube into the larger diameter tube, creating a dual-walled tube.
The third machine in the assembly line uses hydro forming to pressurize the double-walled steel tube into its final shape as a bellows. Once water is removed from the bellows, it is cut at the ends and in the middle, forming two separate bellows. The bellows are then subject to quality control; they are physically inspected and subjected to a pressure test.
After the pressure testing, the bellows are moved to the Benny Line preassembly machine (the Benny machine), which is the final machine in the assembly line. According to the AFR, this machine has several stations within it. At the first station, a worker manually pulls a bellows onto a work holder. Then the worker pulls a sleeve of wire braiding over the mounted bellows. The machine then rolls out the wire braiding to cover the entire length of the bellows. After the rolling process, some of the wire braiding will hang over the ends of the bellows.
At the next station within the Benny machine, a worker will place rings into two ring holders, and place the braided bellows into a clamshell work holder. The machine will then crimp the ends of the bellows to the braided outer layer. Next, the machine will place a ring onto each end of the bellows and shear the excess wire braiding off the ends. Finally, the machine will spot weld the end rings to secure them to the finished bellows.
The instant Protest and AFR covers four different entries. One of the entries is for the Benny machine. The remaining three entries are for three different work holders: the SL 55 NL 240, the NL 138 BMW F25 and the SG86 NL 150 Denali. These work holders keep the bellows, the wire braiding and the end rings in position while the manufacturing process inside the Benny machine takes place.
The merchandise was entered on the following dates: work holder SG86 NL 150 Denali on October 30, 2009, work holder SL 55 NL 240 on December 21, 2009, work holder NL 138 BMW F25 on February 17, 2010, and the Benny machine on May 21, 2010. Witzenmann classified the Benny machine and the work holders under subheading 8479.81.00, HTSUS, as machines and mechanical appliances for treating metal. On October 8, 2010, U.S. Customs and Border Protection (CBP) liquidated all four entries under subheading 8479.89.98, HTSUS, as other machines and mechanical appliances. On April 5, 2011, Witzenmann timely submitted the instant Protest and AFR.
The matter is protestable as a decision on classification. 19 U.S.C. §1514(a)(2). Witzenmann’s AFR satisfies the application criteria because Witzenmann alleges that the Port’s decision is inconsistent with CBP rulings on substantially similar merchandise. 19 C.F.R. § 174.24(a).
ISSUES: 1. Whether the Benny Machine is classified under heading 8479, HTSUS, as a machine or mechanical appliance not specified or included elsewhere, or under heading 8462, HTSUS, as a machine tool for working metal?
2. Whether the work holders are classified under heading 8479, HTSUS, as machines or mechanical appliances not specified or included elsewhere, or under heading 8466, HTSUS, as work holders?
LAW AND ANALYSIS: Classification under the Harmonized Tariff Schedule of the United States (HTSUS) is made in accordance with the General Rules of Interpretation (GRI). 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 may then be applied.
The relevant HTSUS provisions are as follows:
8462 Machine tools (including presses) for working metal by forging, hammering or die-stamping; machine tools (including presses) for working metal by bending, folding, straightening, flattening, shearing, punching or notching; presses for working metal or metal carbides, not specified above:
Bending, folding, straightening or flattening machines (including presses):
8462.29.00 Other
* * *
Shearing machines (including presses), other than combined punching and shearing machines:
8462.39.00 Other
* * *
8466 Parts and accessories suitable for use solely or principally with the machines of headings 8456 to 8465, including work or tool holders, self-opening dieheads, dividing heads and other special attachments for machine tools; tool holders for any type of tool for working in the hand:
8466.20 Work holders:
8466.20.80 Other
* * *
8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof:
Other machines and mechanical appliances:
8479.81.00 For treating metal, including electric wire coil-winders
* * *
8479.89 Other:
Other
* * *
8515 Electric (including electrically heated gas), laser or other light or photon beam, ultrasonic, electron beam, magnetic pulse or plasma arc soldering, brazing or welding machines and apparatus, whether or not capable of cutting; electric machines and apparatus for hot spraying of metals or cermets; parts thereof:
* * *
Note 3 to Section XVI provides as follows:
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 component or as being that machine which performs the principal function.
Note 5 to Section XVI provides as follows:
For the purposes of these notes, the expression "machine" means any machine, machinery, plant, equipment, apparatus or appliance cited in the headings of chapter 84 or 85.
* * *
The Explanatory Notes (EN) 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 at the international level. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
EN 84.62 provides, in pertinent part, as follows:
The heading covers certain machine tools, listed in the heading text, which work by changing the shape or form of metal or metal carbides.
. . .
The heading includes:
. . .
(2) Bending machines. These include machines for working flat products (sheets, plates and strips) which, by passing the products through three or four sets of rollers, give them a cylindrical curve . . . or else a conical shape . . . ; machines for working non-flat products (bars, rods, angles, shapes, sections, tubes). These machines work either by means of forming rollers, by press bending, or, for tubes (and, in particular, oil pipes), by drawing their ends while the main section is held by a fixed cylinder.
EN 85.15(I)(B) provides as follows:
(I) SOLDERING, BRAZING OR WELDING MACHINES AND APPARATUS
This group covers certain soldering, brazing or welding machines and apparatus, whether portable or fixed. They are also classified here when they are capable of cutting.
Welding operations may be performed manually or be fully or partly automatic.
These include:
(B) Machines and apparatus for resistance welding of metal.
The heat required for forming welded joints is produced by the resistance to the flow of an electric current through the parts to be joined (Joule heat). During welding the parts are held together under pressure and fluxes or filler metals are not used.
These machines are of many kinds varying according to the type of article to be welded. They include, for example, butt welding or flash butt welding machines; single spot welding machines comprising guns with or without built in power sources; multispot machines and associated equipment; projection welding machines; seam welding machines; high frequency resistance welding apparatus. (emphasis added)
* * *
Turning first to the Benny machine, we note that both Witzenmann and the Port classified it under heading 8479, HTSUS. Heading 8479, HTSUS, provides for “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter.” Therefore, the Benny machine is only classifiable in heading 8479, HTSUS, if it performs a function that is not specified or included in a different heading of Chapter 84.
Heading 8462, HTSUS, covers “machine tools (including presses) for working metal by bending, folding, straightening, flattening, shearing, punching or notching.” In EOS of North America, Inc. v. United States, 911 F. Supp. 2d 1311, 1333-1334 (Ct. Int’l Trade 2013), the U.S. Court of International Trade (CIT) defined the tariff term “machine tool” as follows:
According to common (as well as technical) definitions, the term refers to a ‘machine’ that uses ‘tooling’ to shape solid work, either by the removal of material from, or by the deformation of, a solid piece of metal or another rigid or semi-rigid material. A ‘machine tool’ is ‘a usu[ally] power-driven machine designed for shaping solid work by tooling either by removing material (as in a lathe or milling machine) or by subjecting to deformation (as in a punch press).’ Webster's Third New International Dictionary (Unabridged) 1354 (1993). A machine tool is also defined as ‘a stationary power-driven machine for the shaping, cutting, turning, boring, drilling, grinding, or polishing of solid parts, especially metals.’ McGraw-Hill Dictionary of Engineering 340 (2d ed. 2003). ‘Machine tools’ are ‘tools used to modify the shapes of materials in specific, controlled ways, such as by drilling holes, turning diameters, grinding radii, and performing many more operations on almost any type of rigid or semi-rigid material.’ Mc-Graw Hill Encyclopedia of Engineering 660 (2d ed. 1993).
Applying this definition, the Benny machine is a power-driven machine for the rolling, crimping and shearing of metal. Heading 8462, HTSUS, specifically lists shearing as a type of work covered by the heading. With regard to rolling, heading 8462, HTSUS, includes bending. EN 84.62 states that rollers which work on metal tubes are a type of bending machine. With regard to crimping, in Headquarters Ruling Letter (HQ) 967975, dated March 24, 2006, we noted that:
Initially, the 84.62 ENs describe bending machines for working flat products either by means of forming rollers or by press bending, and folding machines for working non-flat products in which the folding is akin to forming. There is no dispute that the term “crimping” connotes a type of forming, the term crimp being defined generally as “a: to form into a desired shape…c: to pinch or press together…in order to seal.” See www.britannica.com/dictionary. In addition, the terms crimp, close, and fold are synonymous terms. See www.thesaurus. reference.com. HQ 967974, supra. Clearly, then, crimping machines perform a forming function and qualify as bending or folding machine tools of heading 8462.
As the Benny machine is a machine tool which performs rolling, crimping and shearing functions, we find that these functions are classifiable under heading 8462, HTSUS. However, the Benny machine also contains a spot welder. Welding is not one of the functions covered by heading 8462, HTSUS.
Heading 8515, HTSUS, provides for electric welding machines. EN 85.15(I)(B) states that resistance welding machines are covered by the heading, and that spot welders are types of resistance welding machines. According to the EN, in resistance welding, the heat required for forming welded joints is produced by the resistance to the flow of an electric current through the parts to be joined. Further, CBP has consistently classified spot welding machines in heading 8515, HTSUS. See, e.g. New York Ruling Letter (NY) N189761, dated November 18, 2011, and NY C80699, dated November 7, 1997. For all of these reasons, we find that the spot welder inside of the Benny machine is classifiable under heading 8515, HTSUS.
Since the Benny machine consists of a spot welder of heading 8515, HTSUS, and machine tools of heading 8462, HTSUS, the Benny machine is a composite machine. Note 3 to Section XVI states that a composite machine must be classified as if it only consisted of the machine which performs the principal function.
We note that the Benny machine performs at least four functions: rolling, crimping, cutting and welding. It utilizes rollers to rolls out the sleeve of wire braiding to cover the length of the bellows. It also crimps the ends of the wire braiding together with the bellows, and then fits two end rings onto each end of the bellows. The Benny machine also utilizes a saw to shear off the excess wire braiding. Finally, the spot welder welds the end rings to secure them to each end of the bellows.
Three of the Benny machine’s four functions are described by heading 8462, HTSUS. The machine tool functions of rolling, crimping and shearing are what turn the double-walled braided bellows into a finished product. Although securing the end rings is important, we do not find that spot welding is the Benny machine’s principal function. As the machine tool’s rolling, crimping and shearing comprise the principal function, the Benny machine is classified as a machine tool of heading 8462, HTSUS.
Witzenmann, however, asserts that the Benny machine is properly classified under heading 8479, HTSUS. For support, Witzenmann cites to several CBP rulings: NY 859751, dated February 11, 1991 (machine which winds an insulated copper wire around a shaft classified in subheading 8479.81.00, HTSUS), NY 859754, dated February 14, 1991 (machine which winds insulated copper wire into slots classified in subheading 8479.81.00), NY 886508, dated June 11, 1993 (taping machines that wrapped paper, plastic, or metal tape around cable classified in subheading 8479.81.00, HTSUS), and NY F80621, dated December 22, 1999 (machines used to wind wire onto bobbins classified in subheading 8479.81.00, HTSUS). All of the cited rulings concern the tariff classification of machines which wind wire, or which wind paper, plastic or metal tape around cable. The Benny machines and the work holders do not wind wire, nor do they wind paper, plastic or metal tape around cable. As such, the cited rulings are irrelevant to the classification of the instant merchandise.
Turning next to the work holders, we again note that heading 8479, HTSUS, only covers those machines and mechanical appliances which are not classified elsewhere in Chapter 84. If the work holders are classifiable in another heading of Chapter 84, they cannot be classified in heading 8479, HTSUS. We note that heading 8466, HTSUS, specifically provides for work holders which are solely used with machines of headings 8456 to 8465, HTSUS. The three instant work holders are solely used with the Benny machine, which is classified in heading 8462, HTSUS. As such, the three work holders are classified in heading 8466, HTSUS.
HOLDING:
By application of GRI 1 (Note 3 to Section XVI), the Benny Line, Pre-Assembly Machine is classified under heading 8462, HTSUS. It is specifically provided for in subheading 8462.29.00, HTSUS, which provides in pertinent part, for “[M]achine tools (including presses) for working metal by bending, folding, straightening, flattening, shearing, punching or notching…: Bending, folding straightening or flattening machines (including presses): Other.” The 2010 column one, general rate of duty is 4.4 percent ad valorem.
By application of GRI 1, the SL 55 NL 240 work holder, the NL 138 BMW F25 work holder, and the SG86 NL 150 Denali work holder are classified in heading 8466, HTSUS. They are specifically provided for subheading 8466.20.80, HTSUS, which provides, in pertinent part, for “Parts and accessories suitable for use solely or principally with the machines of headings 8456 to 8465, including work or tool holders …: Work holders: Other.” The 2009 and 2010 column one, general rates of duty are 3.7 percent ad valorem.
Since the rates of duty under the classifications indicated above are more than the liquidated rates, you are instructed to DENY the Protest in full.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.
You are to mail this letter together with the Customs Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of this letter, 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.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division