CLA-2 OT:RR:CTF:TCM H220277 CkG
TARIFF NO: 4011.69.00
James Carroll
Air Ocean Import-Export
20 N. Central Ave.
Valley Stream, NY 11580
RE: Revocation of Headquarters Ruling Letter 966112; All-Terrain Vehicle tires
Dear Mr. Carroll:
This is in reference to Headquarters Ruling Letter (HQ) 966112, issued by Customs and Border Protection (CBP) on April 2, 2003, regarding the classification under the Harmonized Tariff Schedule of the United States (HTSUS) of tires for All-Terrain Vehicles (ATVs). We have reconsidered this decision, and for the reasons set forth below, have determined that classification of the tires in subheading 4011.10, HTSUS, as tires of a kind used on motor cars, was incorrect.
HQ 966112 is a decision on Protest 2704-02-100936. A protest pertains to specific entries of merchandise which have entered the U.S. and been liquidated by CBP. A final determination of a protest, pursuant to Part 174, Customs Regulations (19 CFR 174), cannot be modified or revoked as it is applicable only to the merchandise which was the subject of the entry protested. Furthermore, only a denial is voidable under 19 U.S.C. §1515(d). CBP lost jurisdiction over the protested entries in HQ 966112 when notice of disposition of the protest was received by the protestant. See, San Francisco Newspaper Printing Co. v. U.S., 9 CIT 517, 620 F.Supp. 738 (1935).
However, CBP can modify or revoke a protest review decision to change the legal principles set forth in the decision. 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 (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub.L. 103-182, 107 Stat. 2057), 60 days after the date of issuance, CBP may propose a modification or revocation of a prior interpretive ruling or decision by publication and solicitation of comments in the Customs Bulletin. This revocation will not affect the entries which were the subject of Protest 2704-02-100936, but will be applicable to any entries of similar merchandise made 60 days after publication of the final notice of revocation in the Customs Bulletin.
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, notice proposing to revoke HQ 966112
was published on June 10, 2015, in Volume 49, Number 23 of the Customs Bulletin. No comments were received in response to this notice.
FACTS:
The merchandise at issue was described in HQ 966112 as follows:
At issue are several types of Goodyear Dunlop tires for All-Terrain Vehicles (ATVs). The specific types of tires at issue are Models KT 705, KT 404 (which protestant argues is actually Model KT 405), KT 761 and KT 765.
In HQ 966112, the tires were classified in subheading 4011.10, HTSUS, which provides as follows: "New, pneumatic tires, of rubber: Of a kind used on motor cars (including station wagons and racing cars)." Protestant argued for classification in subheading subheading 4011.91.50, HTSUS, now subheading 4011.69.00, HTSUS, which provides for “New pneumatic tires, of rubber: Other, having a "herring-bone" or similar tread: Other.”
ISSUE:
Whether ATV tires are classified in subheading 4011.10, as tires of a kind used for motor cars, or in subheading 4011.69, as “other” tires having a herringbone or similar tread.
LAW AND ANALYSIS:
Classification of goods under the HTSUS is governed by the General Rules of Interpretation (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 GRIs 2 through 6 may then be applied in order.
The HTSUS provisions under consideration are as follows:
4011: New pneumatic tires, of rubber:
4011.10: Of a kind used on motor cars (including station wagons and racing cars):
4011.10.10: Radial. . .
4011.10.50: Other. . .
Other, having a "herring-bone" or similar tread:
4011.69.00: Other. . .
* * * *
The Harmonized Commodity Description and Coding System Explanatory
Notes (ENs), constitute the official interpretation of the Harmonized System 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 the headings. It is CBP’s 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).
The EN to heading 8703, HTSUS, provides, in pertinent part, as follows:
This heading covers motor vehicles of various types (including amphibious motor vehicles) designed for the transport of persons; it does not, however, cover the motor vehicles of heading 87.02. The vehicles of this heading may have any type of motor (internal combustion piston engine, electric motor, gas turbine, etc.).
The heading also includes :
(1) Motor cars (e.g., limousines, taxis, sports cars and racing cars).
(2) Specialised transport vehicles such as ambulances, prison vans and hearses.
(3) Motor homes (campers, etc.), vehicles for the transport of persons, specially equipped for habitation (with sleeping, cooking, toilet facilities, etc.).
(4) Vehicles specially designed for travelling on snow (e.g., snowmobiles).
(5) Golf cars and similar vehicles.
(6) Four-wheeled motor vehicles with tube chassis, having a motor-car type steering system (e.g., a steering system based on the Ackerman principle).
* * * *
ATVs are classified in heading 8703, HTSUS, which provides for "motor cars and other motor vehicles principally designed for the transport of persons (other than those of heading 8702), including station wagons and racing cars." See HQ 953745, dated April 7, 1993, NY F84501, dated January 31, 2000, NY I86623 dated October 8, 2002, and NY I89444, dated December 17, 2002. Subheading 4011.10, however, only provides for tires “of a kind used on motor cars.” Thus, we must determine whether an ATV is a “motor car” for the purposes of subheading 4011.10, HTSUS.
Motor cars are not defined in the legal text of the HTSUS or in the ENs, however, tariff terms are generally construed in accordance with their common and commercial meanings which are presumed to be the same. See United States v. C.J. Tower & Sons, 48 CCPA 21, C.A.D. 770 (1961), and related cases. In determining the common meaning of a term, it is appropriate to consult dictionaries, lexicons and other reliable sources of information. In HQ 966112, we consulted several dictionaries for the definition of “car” and concluded that the term was broad enough to encompass ATVs. However, the correct term to use when reviewing dictionaries and other lexicographic sources is “motor car”, and not “car” or “motor vehicle” as only the term “motor car” appears in subheading 4011.10.
A number of definitions of “motor car” establish that a motor car is commonly understood to be an engine-propelled vehicle for on road use. See Webster’s Third New International Dictionary (1986) (“automobile: a usu. 4-wheeled automotive vehicle designed for passenger transportation on streets and roadways and commonly propelled by an internal combustion engine…called also car or esp. Brit motorcar”); The Oxford English Dictionary (Second Edition) (“motor car”: A wheeled vehicle…propelled by a motor engine and used esp. as a private conveyance on the road; an automobile); The Random House Dictionary of the English Language (Second Edition, Unabridged, 1987) (“motor car: Chiefly Brit. an automobile”). Similarly, the Oxford English Dictionary online offers this definition of “motor car”: “2. A road vehicle powered by a motor (usually an internal-combustion engine), designed to carry a driver and a small number of passengers, and usually having two front and two rear wheels, esp. for private, commercial, or leisure use; an automobile.” See http://www.oed.com/view/Entry/122742?redirectedFrom=motor%20car#eid. The Cambridge Dictionary Online even defines “car” as “a road vehicle with an engine, four wheels, and seats for a small number of people.” See http://dictionary.cambridge.org/dictionary/american-english/car?q=car.
A motor car is thus a wheeled motor vehicle used for transporting passengers, primarily designed for use on roads. All Terrain Vehicles are not designed for on-road use. ATVs are manufactured for use off the public roads. Accordingly, neither ATVs nor their tires are regulated by the Department of Transportation, which imposes strict labeling requirements for car tires. See NHTSA (National Highway Safety Administration) Interpretive Letter (May 15, 200), online at http://iSearch.nhtsa.gov/files/21340.ztv.html, which further notes that “We regulate “motor vehicles" which are defined, in part, as vehicles "manufactured primarily for use on the public streets, roads, and highways." All-terrain vehicles are instead regulated by the Consumer Product Safety Commission (CPSC). Supra. The CPSC warns that ATVs are not suitable for on-road use, and warns the public to “stay off paved roads” when using ATVs. See U.S. Consumer Product Safety Commission, Top 10 Things Every Rider Must Know About ATVs, online at www.atvsafety.gov/ safetytips.html.
Moreover, the majority of ATVs are not designed for passenger transportation. The CPSC strictly warns against driving ATVs with a passenger or riding as a passenger, because “The majority of ATVs are designed to carry only one person. ATVs are designed for interactive riding – drivers must be able to shift their weight freely in all directions, depending on the situation and terrain. Interactive riding is critical to maintaining safe control of an ATV especially on varying terrain. Passengers can make it difficult for drivers to control the ATV.” Supra. Federal Regulations also primarily define ATVs as off-road, non-passenger vehicles:
“All-terrain vehicle means a land-based or amphibious nonroad vehicle that meets the criteria listed in paragraph (1) of this definition; or, alternatively the criteria of paragraph (2) of this definition but not the criteria of paragraph (3) of this definition: (1) Vehicles designed to travel on four low pressure tires, having a seat designed to be
straddled by the operator and handlebars for steering controls, and intended for use
by a single operator and no other passengers are all-terrain vehicles. (2) Other all-terrain vehicles have three or more wheels and one or more seats, are
designed for operation over rough terrain, are intended primarily for transportation,
and have a maximum vehicle speed higher than 25 miles per hour. Golf carts
generally do not meet these criteria since they are generally not designed for
operation over rough terrain. (3) Vehicles that meet the definition of "offroad utility vehicle" in this section are not all-
terrain vehicles. However, §1051.1(a) specifies that some offroad utility vehicles are
required to meet the same requirements as all-terrain vehicles.
See 40 CFR §1051.801.
We therefore agree that while All Terrain Vehicles are classified in heading 8703, they are not motor cars, but rather “other motor vehicles principally designed for the transport of persons” of heading 8703. EN 87.03(6) reinforces this distinction by separately providing for motor cars and ATVs (four-wheeled vehicles with a tube chassis, having a motor-car type steering system). Classification Opinions 8703.21/1 and 8703.21/2, issued by the World Customs Organization (WCO), confirm that item 6 in EN 87.03 refers to ATVs: “Four-wheeled (two wheel-driven) All Terrain Vehicle ("A.T.V. ") with tube chassis, equipped with a motorcycle type saddle, handlebars for steering and off-the-road balloon tyres. Steering is achieved by turning the two front wheels and is based on a motor-car type steering system (Ackerman principle).”
All Terrain Vehicles are therefore not motor cars for the purpose of subheading 4011.10, HTSUS. However, this would not automatically preclude tires for ATVs from being considered of a kind used on motor cars, if they shared the characteristics of such tires. Subheading 4011.10 is a “use” provision. As such, the tires must fall within the class or kind of tires used on motor cars. According to Additional U.S. Rule of Interpretation 1(a), "[a] tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use."
Courts have provided several factors to apply when determining whether merchandise falls within a particular class or kind of good. They include: (1) the general physical characteristics of the merchandise; (2) the expectation of the ultimate purchasers; (3) the channels of trade in which the merchandise moves; (4) the environment of the sale (e.g. the manner in which the merchandise is advertised and displayed); (5) the usage of the merchandise; (6) the economic practicality of so using the import; and (7) the recognition in the trade of this use. See United States v. Carborundum Co., 63 CCPA 98, 102, 536 F.2d 373, 377 (1976), cert denied, 429 U.S. 979 (1976); Lennox Collections v. United States, 20 CIT 194, 196 (1996).
The physical characteristics of ATV tires clearly indicate that they do not belong to the class or kind of tires used on motor cars. Data from the 2009 Tire and Rim Association (TRA) Yearbook indicates that tires for use on ATVs are on average smaller, have a lower ply and load ratings, and lower maximum psi than those for use with motor cars. For example, according to the TRA Yearbook, ATV tires have smaller rims, ranging in size from 6-14 inches, a smaller overall diameter (13-28 inches), lower ply rating (2, 4, or 6), and a much lower maximum load rating (550-600 lbs) compared to passenger car tires, which range in size from a rim width of 12-24 inches, with an overall diameter of 21-33 inches, a ply rating of up to 12 and a maximum load rating of 2900 lbs. ATV tires also have far lower maximum inflation pressures, due to their use on rough terrain (a lower inflation pressure reduces shocks and punctures and ensures a smoother ride in off-road conditions such as mud, sand or dirt trails). Maximum inflation pressure for ATVs thus generally ranges from 3 to 7 psi, whereas maximum air pressure for automobile tires is up to 42 psi.
Moreover, the separate categorization of tires for ATVs and passenger cars in the TRA Yearbook indicates that these are separate products with separate markets, and are not fungible with each other. Additionally, in contrast to automobile tires, the front and rear tires of ATVs are not interchangeable; rear ATV tires are wider and of more substantial construction to accommodate the heavier load they bear due to engine placement. The tread designs for front and rear ATV tires also differ; ATV front tires are designed primarily for traction and ease in steering as well as channeling away debris, snow, mud, etc. The tire treads of the tires at issue are thus designed for rough terrain conditions rather than on-road use. The marketing of the tires further supports their use with ATV’s, as the tires are clearly designated for such use in the submitted product literature. We further note that the subject styles are available from independent retailers, which also categorize them as ATV tires rather than tires for passenger cars. See e.g., http://www.atvtires.net/products.asp; http://www.tirewholesalers.net/products/index.php/category/ATV+TIRE/manufacturer/ DUNLOP.
The above analysis of the Carborundum factors does not support classification in subheading 4011.10, HTSUS. Therefore the ATV tires are not of a kind principally used on motor cars. Depending on whether the individual tires have a herring-bone or similar tread, they will be classified in either subheading 4011.6, HTSUS, or 4011.9, HTSUS.
CBP has concluded in prior rulings that “herring-bone” refers to a tread pattern consisting of rows of short slanted parallel lines going in the opposite directions from the center of the tread with the slant alternating row by row. These short slanted rows would meet in the center of the tire tread to form a "V" shape. See HQ 958100, dated March 25, 1997. This is supported by the Explanatory Notes (EN) heading 40.11, in which tires classified in subheadings 4011.61-4011.69 (having a herringbone or similar tread) are pictured. All the tire treads pictured therein, except for one, have rows of short slanted parallel lines going in opposite directions with the slant alternating row by row, which stop in the center of the tire and form a "V"-like pattern. The remaining tread pictured in the EN has short slanted parallel lines with the slant alternating row by row which do not meet in the center, but instead extend below the opposite slanted line. This is not a standard herring-bone tread, but an example of a “similar” tread. The tread lugs may be one solid line from sidewall to center, individual raised ridges aligned in a herring-bone pattern, or a combination of a strip of tread and ridges forming the angled line. Examples of herringbone and similar treads are pictured below:
The types of tires at issue are similar to the examples pictured above, and are thus classified in subheading 4011.69, HTSUS, as “Other, having a herring-bone or similar tread: Other.”
Please note that the tires at issue may fall within the scope of antidumping and countervailing duty orders A-570-912 and C-570-913, concerning new pneumatic, off-road tires from China, and published by the U.S. Department of Commerce, International Trade Administration (ITA) on July 15, 2008. See 73 FR 40485. We note that the International Trade Administration is not necessarily bound by a country of origin or classification determination issued by CBP, with regard to the scope of antidumping orders or countervailing duties. Written decisions regarding the scope of AD/CVD orders are issued by the Import Administration in the Department of Commerce and are separate from tariff classification and origin rulings issued by Customs and Border Protection. You can contact them at http://www.trade.gov/ia/ (click on “Contact Us”). For your information, you can view a list of current AD/CVD cases at the United States International Trade Commission website at http://www.usitc.gov (click on “Antidumping and countervailing duty investigations”), and you can search AD/CVD deposit and liquidation messages using ACE, the system of record for AD/CVD messages, or the AD/CVD Search tool at http://addcvd.cbp.gov/index.asp?ac=home.
HOLDING:
By application of GRIs 1 and 6, the ATV tires at issue are classified in subheading 4011.69, HTSUS, which provides for “New pneumatic tires, of rubber: Other, having a "herring-bone" or similar tread: Other.” The 2015 column one, general rate of duty is Free.
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/.
EFFECT ON OTHER RULINGS:
HQ 966112, dated April 2, 2003, 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,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division