CLA-2 OT:RR:CTF:TCM H272344 CkG
Margaret Wilson-McDowell
Customs/Drawback Administrator
Michelin North America, Inc.
One Parkway South P.O. Box 19001
Greenville, South Carolina 29602-9001
Re: Modification of NY I86839 and NY I85323; classification of certain off-the-road
earthmover tires
Dear Ms. Wilson-McDowell:
This is in response to your request of November 04, 2015, for reconsideration of New York Ruling Letters (NY) I86839, dated September 25, 2002, and I85323, dated September 13, 2002, with respect to four models of tires: the XMP (part no. 123406), the X-QUARRY (part no. 123887) the XH D1 (part no. 123031) and the XHAUL (part no. 205207). In NY I86839, CBP classified the XMP tread tire (part no. 123406), the X-QUARRY tread tire (part no. 123887 ) and the XH D1 tread tire (part no. 123031) in subheading 4011.20.10, HTSUS, which provides for “New pneumatic tires of rubber: Of a kind used on buses or trucks: Radial.” In NY I85323, CBP classified the XHAUL tire as a tire of a kind used on buses or trucks, in subheading 4011.20.10, HTSUS. The same XMP, X-QUARRY, and XH D1 tires (part nos. 123406, 123887 and 123031) were also classified in subheading 4011.20, HTSUS, in New York Ruling Letter NY I80691, dated April 26, 2002. We have reconsidered NY I86839, NY I85323 and NY I80691, and for the reasons set forth below, we find that the classification of the X-QUARRY, XH D1 and the XHAUL tires in subheading 4011.20, HTSUS, was incorrect.
We note that your request also includes one model of tire with an X-Traction tread, part no. 166905, which was not at issue in any of the cited rulings. CBP classified several tire models with an X-Traction tread, including part no. 166905, in NY N272481, dated March 1, 2016. In NY N272481, CBP classified three models of tires with an X-Traction tread in subheading 4011.94.40, HTSUS, as tires of a kind used on construction or industrial handling vehicles and machines. NY N272481 is consistent with our current views.
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 modify NY I86839 and NY I85323 was published on June 7, 2017, in Volume 51, Number 23 of the Customs Bulletin. No comments were received in response to this notice.
FACTS:
The subject merchandise consists of four models of earthmover tires: XMP Tread Pattern (part no. 123406); X-QUARRY Tread Pattern (part no. 123887); XH D1 Tread Pattern (part no. 123031); and XHAUL Tread Pattern (part no. 205207).
The XMP Tread tire is marked on the sidewall with the TRA code E2 and the size designation 14.00R25 (indicating that that the section width of the tire is 14 inches, the tire is of radial construction, and it has a rim diameter of 25 inches. The “E2” TRA code refers to tires for “Earthmover” vehicles, with a “Traction” tread.
The X-Quarry Tread tire is marked on the sidewall with the TRA code E4 and the size designation 24.00R25 (24 inch section width radial tire with a rim diameter of 25 inches). The “E4” code refers to earthmover tires with a “Rock (deep tread)”. A technical data sheet obtained from Michelin describes the application of the X-Quarry tire as “quarry transport”.
The XH D1 Tread tire is marked on the sidewall with the TRA code E4 and the size designation 18.00R25 (18 inch section width radial tire with a rim diameter of 25 inches). A technical data sheet obtained from Michelin describes the application of the XH D1 tire as “transport”.
The XHAUL Tread tire is marked on the sidewall with the TRA code E4 and the size designation 18.00R33 (18 inch section width radial tire with a rim diameter of 33 inches).
In NY I86839, we noted that “The Earthmover Tire XMP Tread is used on Logging Trucks, which comprise a tractor unit with 2 or 3 axles, and one or more trailers. The tractor fitted with the XMP Tread is equally capable of on-the-road or off-the-road applications. The X-Quarry Tread and the XH D1 Tread are used on trucks that work in quarries, open pit or surface mines – never on open roads or highways. The X-Quarry Tread is for use on a "Rigid Dumper"; while the XH D1 Tread is for use on a "Rigid Dumper and Logging Truck.”
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 4011.80, HTSUS, as tires “of a kind used on construction, mining or industrial handling vehicles and machines.”
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 HTSUS provisions at issue provide, in pertinent part, as follows:
4011 New pneumatic tires, of rubber:
4011.20 Of a kind used on buses or trucks
4011.20.10 Radial…
. . .
4011.80 Of a kind used on construction, mining or industrial handling vehicles and
machines:
4011.80.10: Having a "herring-bone" or similar tread…
Other:
4011.80.20: Radial…
* * * *
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. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
EN 87.04 provides, in pertinent part, as follows:
This heading also covers :
(1) Dumpers, sturdily built vehicles with a tipping or bottom opening body, designed for the transport of excavated or other materials. These vehicles, which may have a rigid or articulated chassis, are generally fitted with off the road wheels and can work over soft ground. Both heavy and light dumpers are included in this group; the latter are sometimes characterised by a two way seat, two seats facing in opposite directions or by two steering wheels, to enable the vehicles to be steered with the driver facing the body for unloading.
…
Subheading Explanatory Notes.
Subheading 8704.10
These dumpers can generally be distinguished from other vehicles for the transport of goods (in particular, tipping lorries (trucks)) by the following characteristics…”
the dumper body is made of very strong steel sheets; its front part is extended over
the driver’s cab to protect the cab; the whole or part of the floor slopes upwards
towards the rear;
in some cases the driver’s cab is half width only;
lack of axle suspension;
high braking capacity;
limited speed and area of operation;
special earth moving tyres;
because of their sturdy construction the tare weight/payload ratio does not exceed
1 : 1.6;
the body may be heated by exhaust gases to prevent materials from sticking or
freezing.
It should be noted, however, that certain dumpers are specially designed for working in mines or tunnels, for example, those with a bottom opening body. These have some of the characteristics mentioned above, but do not have a cab or an extended protective front part of the body.
* * * *
Heading 40.11 provides for “New pneumatic tires, of rubber.” There is no dispute that the instant tires are classified therein. The issue arises at the six-digit subheading level.
Subheading 4011.20 provides for “New pneumatic tires, of rubber: Of a kind used on buses or trucks.” Subheading 4011.80 provides for “New pneumatic tires, of rubber: Of a kind used on construction, mining or industrial handling vehicles and machines.
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.
Trucks are motor vehicles for the transport of goods that are classifiable in Chapter 87. Dump trucks are trucks classifiable in heading 87.04, as motor vehicles for the transport of goods. However, we note that the EN to heading 40.11 as well as the international legal text of the Harmonized System uses the word “lorries” in subheading 4011.20 instead of “trucks”. In this regard, we note that Article 3 of the International Convention on the Harmonized Commodity Description and Coding System, states in pertinent part, as follows:
Subject to the exceptions enumerated in Article 4: Each Contracting Party undertakes… that, in respect of its Customs tariff and statistical nomenclatures: it shall use all the headings and subheadings of the Harmonized System without addition or modification, together with their related numerical codes; it shall apply the General Rules for the interpretation of the Harmonized System and all the Section, Chapter and Subheading Notes, and shall not modify the scope of the Sections, Chapters, headings or subheadings of the Harmonized System…
* * * *
In complying with the undertakings of Article 3, each Contracting Party may make such textual adaptations as may be necessary to give effect to the Harmonized System in its domestic law. That the text of subheading 4011.20 in the HTSUS refers to “trucks” as opposed to “lorries” is indicative of a textual adaptation to give effect to a term (“lorries”) that is not commonly used in American English. Accordingly, the scope of subheading 4011.20, HTSUS, is informed by the legal text of the Harmonized Commodity Description and Coding System as well as EN 40.11.
We further note that the Explanatory Note to subheading 8704.10 draws a distinction between “dumpers” and “lorries” (trucks), stating that “These dumpers can generally be distinguished from other vehicles for the transport of goods (in particular, tipping lorries (trucks)) by the following characteristics”, such as, i.e., “special earth-moving tires.”
The CBP Informed Compliance Publication (ICP) on Classification of Tires further notes that “There are numerous machines identified as classifiable in chapter 84 that move on tires but are not trucks. These would include excavating machines of heading 8429, construction machines and snow plows of heading 8430, agricultural machines of heading 8432 and harvesting machines of heading 8433. Although they all may be designed in some instances to roll on tires, they are not trucks, but machines, and their tires would be classifiable further on in heading 4011.”
The Tire and Rim Association (TRA) Yearbook provides the following explanation of its “Earthmover” designation:
Earthmover: transportation usually occurs over unimproved surfaces at speeds up to 40 mph and short distances, up to 2.5 miles, one way. Equipment in this category is mainly haulage trucks and scrapers.
Thus, the reference to buses and lorries in the legal text of the HS and the Explanatory Notes indicates that the contemplated class or kind of tires classified in 4011.20 would be the kind of tires meant to be used on-road or on-the highways passenger or commercial vehicles.
It therefore follows that under the general, colloquial category of “dump trucks”, some are trucks or lorries equipped with tires of subheading 4011.20, HTSUS, and some are specialized “dumpers” and other machines using tires of subheadings 4011.70-4011.90. Those earthmoving tires for dump trucks having limited speed and area of operation, which are generally used over unimproved surfaces, for short distances only, and designed for specific applications such as construction or mining—fall within the latter category.
However, as we noted in HQ H192148, “Dumper tires with characteristics for use other than normal on road use or mixed on-road off-road use should be classified in subheading 4011.6 or 4011.9.” Thus, dump truck tires, even those bearing the TRA code “E”, are not precluded from classification in subheading 4011.20, HTSUS, if they are designed for vehicles capable of on-road use or mixed on and off road use. Such tires and the vehicles for which they are designed are capable of higher speeds and broader area of operation than those described in the ENs or the ICP above. Our holding in HQ H192148 is therefore limited to dumper tires for off-road use. Dump truck or dumper tires designed for on-road or mixed use are of a kind used on trucks, and thus within the scope of subheading 4011.20, HTSUS.
In NY I86839, we noted that the XMP (part no. 123406) tread tire was designed for mixed on and off road use, whereas the X-QUARRY and XH D1 tires were never used on open roads or highways. The XMP tire tread is further described in the Michelin reference manual for earthmover tires as “Radial tire for utility transport and logging operations designed for high speed applications” See http://llantasyequipos.com.mx/catalogos/industrial/MICHELIN_OTR_tire_data_reference_manual.pdf. In contrast, the XH D1 is touted as a “Deep tread traction tyre for rigid dump truck in quarrying and harsh mining conditions... Sidewall reinforcement protects the tire against cutting and abrasion on the toughest haul roads.” The XH D1 is stated to be designed for rigid dumpers. http://www.michelinearthmover.com/eng_us/tires-rigid-dumpers-100t/michelin-xh-d1//247. The X-QUARRY is similarly touted as “the extremely durable Michelin® E4 radial tire designed for use on haul trucks running at low speeds in the most damaging quarry conditions.” See http://llantasyequipos.com.mx/catalogos/industrial/MICHELIN_OTR_tire_data_reference_manual.pdf. Finally, the XHAUL tread is described in Michelin’s brochure as “a radial tire for haul trucks operating at moderate speeds to provide excellent protection and long wear in harsh conditions…for use on rigid dumpers and bottom dump trucks… The square shoulders and reinforced sidewalls help provide exceptional protection in severe operating conditions resulting in optimal durability.”
The XMP (part no. 123406) tread tire is designed for both on and off-road use, and is therefore classified in subheading 4011.20, HTSUS. In contrast, the X-QUARRY (part no 123887), the XH D1 (part no. 123031) and the XHAUL (part no. 205207) tires are used primarily in off-road conditions in mines and quarries, they are not of a class or kind used on trucks and are not classified in subheading 4011.20, HTSUS. The X-QUARRY, XH D1 and XHAUL are radial tires, and they do not have a herring bone tread pattern. They are therefore classified in subheading 4011.80.20, HTSUS. This is consistent with prior CBP rulings HQ H263902, dated June 23, 2016, NY N272481, dated March 1, 2016, and NY N261453, dated February 20, 2015.
HOLDING:
The XMP tread tire (part no. part no. 123406) is 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 2016 column one, general rate of duty is 4% ad valorem.
The X-QUARRY tread tire (part no. 123887), the XH D1 tread tire (part no. 123031) and the XHAUL tire (part no. 205207) are classified in subheading 4011.80.20, HTSUS, which provides for “New pneumatic tires, of rubber: Of a kind used on construction, mining or industrial handling vehicles and machines: Other: Radial.” The 2017 column one, general rate of duty is 4% ad valorem.
EFFECT ON OTHER RULINGS:
NY I86839, dated September 25, 2002, and NY I85323, dated September 13, 2002, are hereby modified with respect to part nos. 123887 (X- QUARRY), 123031 (XH D1), and 205207 (XHAUL).
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