CLA-2 OT:RR:CTF:TCM H266007 PJG
Donald S. Stein
Greenberg Traurig, LLP
2101 L Street, N.W., Suite 1000 Washington, DC 20037
RE: Modification of NY N264006; tariff classification of an aircraft engine
Dear Mr. Stein:
This is in response to your request for reconsideration dated May 19, 2015, of New York (NY) ruling letter N264006, dated April 29, 2015, issued to your client, StandardAero (San Antonio) Inc. (“StandardAero”). In NY N264006, U.S. Customs and Border Protection (“CBP”) classified several models of engines. In relevant part, CBP classified the Model 250-C20B (“M250-C20B” or “C20B”) engine in heading 8411, HTSUS, specifically, in subheading 8411.81.8000, HTSUS, which provides for “Turbojets, turbopropellers and other gas turbines, and parts thereof: Other gas turbines: Of a power not exceeding 5,000 kW: Other.” The subject request for reconsideration concerns only the tariff classification of the Rolls Royce (“RR”) M250-C20B model engine. We have reconsidered NY N264006, and based upon the additional information that you have submitted with your request, we have determined that the holding in NY N264006 is in error with respect to the Rolls Royce M250-C20B model engine. Accordingly, NY N264006 is modified.
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. No. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed action was published on August 24, 2016, in Volume 50, Number 34, of the Customs Bulletin. No comments were received in response to this notice.
FACTS:
In NY N264006, the C20B model was described as one of six engine models in the Rolls Royce M250-C20 model series. In NY N264006, CBP classified the C20B model engine in 8411.81.8000, HTSUSA, which provides for "Turbojets, turbopropellers and other gas turbines, and parts thereof: Other gas turbines: Of a power not exceeding 5,000 kW: Other.” This decision was based on statements made to CBP by StandardAero that the C20B model engine is used on a helicopter and as a base for the Rolls Royce KS4 engine, which is an industrial use engine that is used on U.S. Navy ships. Based on this information, CBP determined in NY N264006 that the Rolls Royce C20B model engine has a dual use, and therefore could not be classified as an “Aircraft turbine.”
In the reconsideration request, you have submitted additional information about the C20B model engine in the form of: a Federal Register Notice of Proposed Rulemaking showing that the C20B model engine is subject to the regulations of the Federal Aviation Administration, U.S. Department of Transportation; a series of documents showing the “evolution” of the Rolls Royce Model 250 series engine; and a Wikipedia entry describing the C20B model engine. In addition you have clarified previous statements made to CBP about the M250-C20B model engine, specifically, you state that “[i]t is solely used in a helicopter aircraft. It is not a dual use engine.” Moreover, you state that the Rolls Royce KS4 engine and the Rolls Royce M250-C20B engine “are unique and will never be commissioned to work each other’s end use.”
You have also supplemented your request for reconsideration with an excerpt from the RR M250-C20B Operation and Maintenance Manual 10W2 concerning the design of the M250-C20B engine and a depiction of the M250-C20B engine from the same manual (Figure 1). The excerpt provides, in pertinent part, the following:
Compressor
The compressor assembly consists of a compressor front support assembly, compressor rotor assembly, compressor case assembly, and compressor diffuser assembly. Air enters the engine through the compressor inlet and is compressed by six axial compressor stages and one centrifugal stage. The compressed air is discharged through the scroll type diffuser into two ducts which convey the air to the combustion section. (See Figure 2).
Combustion Section
The combustion section consists of the outer combustion case and the combustion liner. A spark igniter and a fuel nozzle are mounted in the aft end of the outer combustion case. Air enters the single combustion liner at the aft end, through holes in the liner dome and skin. The air is mixed with fuel sprayed from the fuel nozzle and combustion takes place. Combustion gases move forward out of the combustion liner to the first-stage gas producer turbine nozzle.
Turbine
The turbine consists of a gas producer turbine support, a power turbine support, a turbine and exhaust collector support, a gas producer turbine rotor and a power turbine rotor. The turbine is mounted between the combustion section and the power and accessory gearbox. The two-stage power turbine furnishes the output power of the engine. The expanded gas discharges in an upward direction through the twin ducts of the turbine and the exhaust collector support.
Power and Accessory Gearbox
The main power and accessory drive gear trains are enclosed in a single gear case. The gear case serves as the structural support of the engine. All engine components including the engine mounted accessory are attached to the case. A two-stage helical and spur gear set is used to reduce rotation speed from 33,290 rpm at the power turbine to 6016 rpm at the output drive spline. Accessories driven by the power turbine gear train are the airframe furnished power turbine tachometer-generator and the power turbine governor. The gas producer gear train drives the compressor, fuel pump, an airframe furnished gas producer tachometer-generator, and gas producer fuel control. The starter drive and spare drive are in this gear train.
ISSUE:
What is the proper classification of the Rolls Royce M250-C20B model engine under the HTSUS?
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 2016 HTSUS provisions under consideration are as follows:
8411 Turbojets, turbopropellers and other gas turbines, and parts thereof:
Turbojets:
8411.11 Of a thrust not exceeding 25kN:
8411.11.40 Aircraft turbines
* * *
Other gas turbines:
8411.81 Of a power not exceeding 5,000 kW:
8411.81.40 Aircraft turbines
8411.81.80 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 these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The EN to 84.11 states, in pertinent part:
The heading covers turbo-jets, turbo-propellers and other gas turbines.
The turbines of this heading are, in general, internal combustion engines which do not usually require any external source of heat as does, for example, a steam turbine.
…
(A) TURBO-JETS
A turbo-jet consists of a compressor, a combustion system, a turbine and a nozzle, which is a convergent duct placed in the exhaust pipe. The hot pressurised gas exiting from the turbine is converted to a high velocity gas stream by the nozzle. The reaction of this gas stream acting on the engine provides the motive force which may be used to power aircraft. In its simplest form the compressor and turbine are accommodated on a single shaft. In more complex designs the compressor is made in two parts (a two spool compressor) in which the spool of each part is driven by its own turbine through concentric shafting. Another variation is to add a ducted fan usually at the inlet to the compressor and drive this either by a third turbine or connect it to the first compressor spool. The fan acts in the nature of a ducted propeller, most of its output bypassing the compressor and turbine and joining the exhaust jet to provide extra thrust. This version is sometimes called a “bypass fan jet”.
So-called “after-burning” appliances are auxiliary units for mounting in series with certain turbo-jet engines in order to boost their power output for short periods. These appliances have their own fuel supply and utilise the excess oxygen in the gases issuing from the turbo-jet.
* * *
(C) OTHER GAS TURBINES
This group includes industrial gas-turbine units which are either specifically designed for industrial use or adapt turbo-jets or turbo-propeller units for uses other than providing motive power for aircraft.
There are two types of cycles:
(1) The simple cycle, in which air is ingested and compressed by the compressor, heated in the combustion system and passed through the turbine, finally exhausting to the atmosphere.
(2) The regenerative cycle, in which air is ingested, compressed and passed through the air pipes of a regenerator. The air is pre-heated by the turbine exhaust and is then passed to the combustion system where it is further heated by the addition of fuel. The air/gas mixture passes through the turbine and is exhausted through the hot gas side of the regenerator and finally to the atmosphere.
There are two types of designs:
(a) The single-shaft gas turbine unit, in which the compressor and turbine are built on a single shaft, the turbine providing power to rotate the compressor and to drive rotating machinery through a coupling. This type of drive is most effective for constant speed applications such as electrical power generation.
(b) The two-shaft gas turbine unit, in which the compressor, combustion system and compressor turbine are accommodated in one unit generally called a gas generator, whilst a second turbine on a separate shaft receives the heated and pressurised gas from the exhaust of the gas generator. This second turbine known as the power turbine is coupled to a driven unit, such as a compressor or pump. Two-shaft gas turbines are normally applied where load demand variations require a range of power and rotational speed from the gas turbine.
These gas turbines are used for marine craft and locomotives, for electrical power generation, and for mechanical drives in the oil and gas, pipeline and petrochemical industries.
This group also includes other gas turbines without a combustion chamber, comprising simply a stator and rotor and which use energy from gases provided by other machines or appliances (e.g., gas generators, diesel engines, free-piston generators) and compressed air or other compressed gas turbines.
* * *
You argue that the Rolls Royce M250-C20B model engine should be classified in subheading 8411.11.4000, HTSUSA, as “Turbojets, turbopropellers and other gas turbines, and parts thereof: Turbojets: Of a thrust not exceeding 25kN: Aircraft turbines,” because the merchandise is an aircraft engine and does not share the same end application and use as the KS4 Engine, which is an industrial use engine. Therefore, you indicate that the C20B model engine “is not a dual use engine.”
We agree that heading 8411, HTSUS is the appropriate heading for the tariff classification of the Rolls Royce M250-C20B model engine. We also note that each type of engine designated under heading 8411, HTSUS, is considered to be a “gas turbine,” but it is the specific construction and use of the gas turbine that determines whether that model is classified as a “Turbojet,” “Turbopropeller,” or “Other Gas Turbine.” See HQ H966934 (dated May 6, 2004).
We note that the power rating of “Turbojets” is measured in thrust, the units of which are given in pound thrust or Newtons, whereas the power rating of “Other gas turbine[],” such as a turboshaft, is measured in Watts. See subheading 8411.11, HTSUS, and subheading 8411.81, HTSUS. The subject merchandise has a power rating that is measured in shaft horsepower (“shp”), which can be converted into Watts. Therefore, given its power rating, the subject merchandise cannot be classified in subheading 8411.11, HTSUS, as a turbojet engine.
Based upon the design of the subject merchandise, we find that the Rolls Royce M250-C20B model engine is a turboshaft engine. The description of the design of the merchandise that was provided as a supplement to the request for reconsideration is consistent with the simple cycle engine description provided in EN 84.11(C)(1) and the two-shaft gas turbine unit design described by EN 84.11(C)(b). According to its design and power rating of 313 kW, we find that it is classified under subheading 8411.81, HTSUS, which provides for “Turbojets, turbopropellers and other gas turbines, and parts thereof: Other gas turbines: Of a power not exceeding 5,000 kW.” Based on the documentation that you provided in your request for reconsideration, we agree that the Rolls Royce M250-C20B model engine is only used as an aircraft engine for helicopters in its condition as imported, rather than as a dual-use engine designed for aircraft use and industrial use, as indicated in NY N264006. Therefore, the subject merchandise is not classified in subheading 8411.81.80, HTSUS, which would be appropriate for dual-use engines, rather, it is classified under subheading 8411.81.40, HTSUS, which provides for “Turbojets, turbopropellers and other gas turbines, and parts thereof: Other gas turbines: Of a power not exceeding 5,000 kW: Aircraft turbines.”
HOLDING:
Under the authority of GRIs 1 and 6, the Rolls Royce M250-C20B engine is classified in heading 8411, HTSUS, specifically in subheading 8411.81.40, HTSUS, which provides for “Turbojets, turbopropellers and other gas turbines, and parts thereof: Other gas turbines: Of a power not exceeding 5,000 kW: Aircraft turbines.” The 2016 column one, general rate of duty is Free.
Duty rates are provided for convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the internet at www.usitc.gov/tata/hts/.
EFFECT ON OTHER RULINGS:
NY N264006, dated April 29, 2015, is hereby MODIFIED.
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