CLA–2 OT:RR:CTF:TCM H242098 CKG
RE: Internal Advice; Classification of tires from China
Port Director
U.S. Customs and Border Protection
Port of Los Angeles/Long Beach
301 E. Ocean Blvd., Suite 1400 Long Beach, CA 90802
ATTN: Danny Johnson, Sr. Import Specialist
This letter is in reply to your request for internal advice of March 1, 2013,
initiated by counsel on behalf of the importer, pertaining to the tariff classification of various models of rubber tires imported from China. Specifically, you request our views on the importer’s claims that the instant tires are classified in subheading 4011.99, HTSUS, as “other” tires.
A CBP Audit Report, dated November 7, 2012, determined that the instant tires were misclassified in subheading 4011.99, HTSUS, and that the proper classification for the merchandise is subheading 4011.20, as tires of a kind used on light trucks. New, pneumatic tires from China, of a kind used on motor cars, on-the-highway light trucks, vans, and sport utility vehicles, provided for in subheadings 4011.10.10, 4011.10.50, 4011.20.10, and 4011.20.50 of the HTSUS, entered between September 26, 2009 and September 25, 2012, are subject to an additional duty imposed by Presidential Proclamation number 8414. See 74 FR 47861, published September 17, 2009; http:// http://www.cbp.gov/xp/cgov/trade/trade_programs/entry_summary/laws/advalorem_chinese_tires.xml. Counsel for the importer argues that the tires under consideration are tires for use on trailers only, are not used or suitable for use on light trucks or passenger tires, and are therefore not subject to the safeguard duty rate.
FACTS:
The merchandise at issue consists of five models of new, pneumatic rubber tires, designated as: STR-2048-LL (Linglong brand, 7.00R15 10 ply, LMC4 tread), STR 2073-LL and STR-2073AA-LL (Crosswind brand, 235/80/R16, 10 and 12 ply), STB-0004A-QZ (SuperMax brand, 7.00-15, 8 ply, M686 tread), and STB-0005A-QZ (SuperMax brand, 7.50-16, 10 ply, M218 tread).
The tires are marked on the sidewall with their size and load rating and with the words “Trailer Service Only”.
ISSUE:
Whether the instant tires are classified in subheading 4011.20, HTSUS, as tires of a kind used on buses or trucks, or in subheading 4011.99, HTSUS, as other tires.
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. GRI 6, HTSUS, requires that the GRI's be applied at the subheading level on the understanding that only subheadings at the same level are comparable. The GRI's apply in the same manner when comparing subheadings within a heading.
The HTSUS provisions at issue are as follows:
4011: New pneumatic tires, of rubber
4011.20: Of a kind used on buses or trucks
4011.20.10: Radial…
4011.20.50: Other…
Other:
4011.99: Other:
4011.99.45: Radial…
4011.99.85: Other…
* * * *
The CBP Audit Report concluded that the instant tires are classified in subheading 4011.20, HTSUS, as tires of a kind used on trucks. The importer contends that the tires at issue are tires for trailer use, classified as “other” tires in subheading 4011.99, HTSUS. Subheading 4011.20 is a “principal use” provision, governed by Additional U.S. Rule of Interpretation 1(a), HTSUS, which provides that:
In the absence of special language or context which otherwise requires--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.
It is the principal use of the class or kind of good to which the imports belong and not the principal use of the specific imports that is controlling under the Rules of Interpretation. See Group Italglass, U.S.A., Inc. v. United States, 17 CIT 1177, 839 F. Supp. 866 (1993).
The Courts have provided factors, which are indicative but not conclusive, to apply when determining whether merchandise falls within a particular class or kind. These include: general physical characteristics, the expectation of the ultimate purchaser, channels of trade, environment of sale (accompanying accessories, manner of advertisement and display), use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use. See United States v. Carborundum Company, 63 CCPA 98, C.A.D. 1172, 536 F. 2d 373 (1976), cert. denied, 429 U.S. 979 (1976). See also Lennox Collections v. United States, 20 CIT 194, 196 (1996).
Tires designed specifically for trailer use differ from those for other on-road vehicles such as passenger cars and light trucks in that they are typically narrower than car tires, feature stiffer sidewalls (to prevent the rig from swaying), and have shallower treads and a slightly higher load capacity than light truck tires. They are generally marked on the sidewall with an “ST” (Special Trailer) designation and “for trailer use only”. These physical criteria are a useful indicator of intended use, and should be considered along with the remaining Carborundum factors.
We will examine the Carborundum factors for the Crosswind, SuperMax and Linglong brand tires individually.
The STR 2073-LL and STR-2073AA-LL Crosswind 235/80R16 tires:
The 2073-LL and 2073AA-LL Crosswind tires measure 235 millimeters in width and 188 millimeters in height, with ply ratings of 10 and 12 and corresponding load ranges E and F. Pictures of the Crosswind tires show that they are marked on the sidewall with their size, load rating, and the words “trailer service only”.
The ply and load ratings of the instant tires indicate their suitability for use on light trucks or trailers, but their size is indicative of trailer use. The Tire and Rim Association (TRA) publishes industry-recognized technical specifications on vehicle tires in its annual “Yearbook”. The 2009 TRA Yearbook includes the 235/80R16 configuration in the section for Trailer tires (titled “Tires for Trailers in Highway Service”), while this model is not listed anywhere in the section of the Yearbook for Light Truck tires. This suggests that the physical characteristics of the tire are specialized for trailer use and not suitable for use on light trucks. In addition, the environment of sale and trade recognition support classification of the instant tires in subheading 4011.99, HTSUS. For example, the top google search results for “235/80R16” are all trailer tires. Searching for these specific size configurations on the websites of tire retailers such as Discount Tires Co and Tirerack.com, yields the same results: all search results are for “ST” trailer tires only. The importer’s website also categorizes the instant tires as trailer tires. This further suggests that this particular size and load configuration is not suitable for use on other vehicles, or at least not commonly used on vehicles other than trailers.
Finally, the importer submits affidavits from its buyers attesting to the recognition in the trade of the instant tires as being solely for use on trailers.
The “trailer use only” sidewall marking, the environment of sale and the recognition of trade of the instant tires as trailer tires will also affect the expectation of the ultimate purchaser, as the purchaser will expect from the physical characteristics, marketing and channels of trade of the instant tires that he is purchasing tires for use on trailers.
Based on the advertisement and classification of the Crosswind 235/80R16 tires as for trailer use only by the importer and most, if not all, retailers, the markings on the sidewall, and the lack of any evidence that size 235/80R16 of any brand are commonly used on any vehicles other than trailers, we find that this model is classified in subheading 4011.99, HTSUS, and not subheading 4011.20, HTSUS.
The STB-0004A-QZ and STB-0005A-QZ SuperMax 7.00-15 and 7.50-16 bias ply tires:
The STB-0004A-QZ and STB-0005A-QZ SuperMax tires measure 7 and 7.5 inches in width, with ply ratings of 8 and 10 ply and corresponding load ranges D and E. The pictures provided indicate that the tires have a standard tread suitable for on-road use, and are marked on the sidewall with the phrase “trailer service only”. The tires are bias ply.
Increasingly, on-the highway, light truck tires are almost exclusively radial tires as opposed to bias, because radial tires have a lower rolling resistance and thus better high speed performance for on-road use. Bias ply tires feature a cross-ply construction that makes for stronger sidewalls and less sideways movement of the tire. This results in a less comfortable ride, since the tire does not absorb bumps and shocks as well as a radial tire. Bias tires are thus generally used on trailers or off-highway trucks. Bias tires for light trucks and motor cars are classified in subheadings 4011.20.50 and 4011.10.50, respectively, and thus do not necessarily fall outside the scope of the safeguard. Nevertheless, we find that the tires’ bias construction is a physical characteristic showing trailer use because bias tires are rarely used on motor cars or on-the-highway light trucks, and because the tread does not have the deep grooves and large lugs of an off-road tire, indicating that the tires are not designed for use on off-road vehicles. The instant tires are further marked on the sidewall with the words “Trailer Service Only”. The physical characteristics of the 7.00-15 and 7.50-16 tires are therefore indicative of use on trailers.
With respect to the remaining Carborundum factors, we note that while 7.00-15 and 7.50-16 size tires are listed in the TRA Yearbook and are generally sold online as either trailer or light truck tires, searching specifically for 7.00-15 and 7.50-16 bias ply tires yields, almost exclusively, results for trailer tires. The importer’s website also categorizes the instant tires as trailer tires. Finally, the importer submits affidavits from its buyers which attest to the recognition in the trade of the instant tires as being solely for use on trailers.
The “trailer service only” sidewall marking, the environment of sale and the recognition of trade of the instant tires as trailer tires will also affect the expectation of the ultimate purchaser, as the purchaser will expect from the physical characteristics, marketing and channels of trade of the insant tires that he is purchasing tires for use on trailers.
Based on the bias ply construction of the SuperMax tires, the advertisement and classification of the SuperMax tires as for trailer use only by the importer and most, if not all, retailers, and the “trailer service only” markings on the sidewall, we find that the SuperMax models are not of a kind used on light trucks, and are thus classified in subheading 4011.99, HTSUS.
STR-2048-LL Linglong 7.00R15 10 ply tire:
The Linglong 7.00R15 tire measures 7 inches in width, with a 10 ply rating and corresponding load range of E, suitable for use with either light trucks or trailers. The pictures provided indicate that the tires have a standard tread suitable for on-road use and are marked on the sidewall with the phrase “trailer service only”. The importer claims that the particular rubber composition and mixing procedures of the instant tires were designed to produce a designated inflation pressure of 105 psi, which exceeds the maximum recommended inflation pressure of 80 psi for light truck tires with a load range of E, and even the maximum inflation pressure of 95 psi for any light truck tire.
7.00-15 size radial tires are listed in the TRA Yearbook and are generally sold online as either trailer or light truck tires. Although the importer’s website and marketing catalog list the Linglong 7.00R15 as a trailer tire, the manufacturer, Linglong Tyre Co., categorizes the 7.00R15 radial tires with LMC4 tread pattern as light truck tires on its website. See http://www.linglong.com.au/4WD_and_light_trucks/LMC4.html; http://en.linglong.cn/products_detail/&productId=b9c79e45-060d-41bd-840e-f1069ed092a3&comp_stats=comp-FrontProducts_list01-004.html. The LMC4 is not listed among the trailer tires offered by Linglong; indeed, no 7.00-15 tire, radial or bias, is listed among the trailer tires offered by Linglong.
The importer also submits affidavits from its buyers, as well as the manufacturer and supplier of the Linlong tires, all attesting to the sole use of the instant tires as trailer tires. However, as noted above, the only 7.00R15 radial tire with the LMC4 tread offered on Linglong Tyre Co.’s website is marketed as a light truck tire.
We find that the evidence is sufficient to establish that the Linglong 7.00R15 tires are of a kind used on buses or trucks. While counsel claims that the particular composition of the instant tires allow them to be inflated at a higher pressure than is typical for light truck tires, it has offered no details of the tires’ composition or construction, and therefore no evidence that such construction makes them more suitable for higher inflation pressures. Given that the tires’ physical characteristics are consistent with those of light truck tires, and they are commonly sold and used as light truck tires, we find that the Linglong 7.00R15 are classified in subheading 4011.20, HTSUS.
HOLDING:
By application of GRIs 1 and 6, the Crosswind 235/80/R16 tires are classified in subheading 4011.99.45, HTSUS, which provides for ““New pneumatic tires, of rubber: Other: Other: Radial…”. The 2015 general, column one rate of duty is 4% ad valorem.
The SuperMax 7.00-15 and 7.50-16 tires are classified in subheading 4011.99.85, HTSUS, which provides for ““New pneumatic tires, of rubber: Other: other: Other…” . The 2015 general, column one rate of duty is 3.4% ad valorem.
The Linglong 7.00R15 tires are classified in subheading 4011.20.10 HTSUS, which provides for “New pneumatic tires, of rubber: Of a kind used on buses or trucks: Radial.” The 2015 general, column one rate of duty is 4% ad valorem.
Duty rates are provided for the internal advice applicant’s convenience and are
subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided online at www.usitc.gov.
You are directed to mail this decision to the internal advice applicant, no later than 60 days from the date of this letter. On that date the Office of Regulations and Rulings will make the public version of the decision available to CBP personnel, and to the public on the CBP Home Page online at www.CBP.gov, by means of the Freedom of Information Act, and other public methods of distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division