CLA-2-84:OT:RR:NC:1:104
Ms. Sheri G. Lawson
Wilson International Inc.
160 Wales Avenue
Suite 100
Tonawanda, NY 14150
RE: The tariff classification of Lifebreath Heat and Energy Recovery Ventilators from Canada and Control Accessories from China
Dear Ms. Lawson:
In your letter dated March 4, 2019, on behalf of your client, Airia Brands Inc., you requested a tariff classification ruling.
Lifebreath Heat Recovery Ventilators (HRVs), model numbers RNC200 and RNC205, and Lifebreath Energy Recovery Ventilator (ERVs), model number 170ERVD, are mechanical ventilation systems used to provide balanced ventilation by providing two separate air paths. They are the combination of an exhaust system and a supply system in a single packaged solution. The exhaust system removes air from the building and the supply system adds outdoor air into the building. All HRVs transfer heat, reclaim energy that would be wasted in an exhaust air stream, and control excess humidity in the building by using dry outdoor air in the heating season to replace moist indoor air. During the heating season, the HRVs replace stale air with fresh air throughout the building helping to prevent moisture build-up, toxic mold and rot. The ERVs transfer heat and humidity, reclaim energy wasted in an exhaust air stream and minimizes costs associated with ventilation. The ERVs control excess humidity in the building by using the dry outdoor air in the heating season and transferring outdoor humidity in cooling seasons. The moisture in the air will move through the ERV from the high humidity airstream to the low humidity airstream providing fresh air into a building while exhausting an equal amount of stale air to the outside. Energy including moisture is transferred between the airstreams, thereby reducing the loads on the heating and cooling equipment.
The HRV and the ERV are self-contained products consisting of a steel cabinet. Inside the cabinet are two fans. One fan exhausts air from a building to outdoors and the other fan brings air from outdoors and supplies it to the building. The two airflows pass through a plate type air-to-air heat exchanger which is built into the product. The heat exchanger has no moving parts and transfers heat or moisture trough the surface of the heat exchanger plates. Air filters are internal and keep the heat exchanger plates clean and reduce the number of airborne particles from entering the building from the outdoors. The HRV and ERV contain no compressors, heating or cooling elements. They are controlled by small electrical circuit boards found in the HRV or the ERV and a wall control installed in the building. The control will turn the HRV or the ERV on and off and changes the speed of the fans. Power is provided through a standard electrical cord for 120 volts. The HRVs and the ERVs cannot be used without the controls since they do not contain any buttons or switches that allow them to be used separately.
There are a variety of control models which contain a variety of settings for the fan, standby settings, electronic dehumidistat and modes of operation. The control model numbers consist of BC02, BC03, BC04, and the generic models GBC02, GBC03, GBC04, DXLP02 and DXPL02 (generic model of DXLP02) that comes without the Lifebreath logo. The Lifebreath Digital Control 99-DXPL02 (generic model of DXLP02), Lifebreath Ventilation Control 99-BCO2, and Lifebreath Ventilation Control 99-BC03 are described as controllers that function as dehumidistats used to regulate indoor humidity levels. Each controller senses indoor humidity levels and once the controller determines that humidity levels have risen above the adjustable set point, the controller will initiate high-speed ventilation. Ventilation will stop once the dehumidistat controller senses the humidity levels have been reduced.
The Lifebreath Wireless Repeater, model number 99-RX02, is used to extend the range of the 99-DET02 Wireless Timers. The repeater plugs directly into a 120V power outlet.
You have requested classifications for the following two scenarios: (1) the HRV or the ERV units alone and (2) the HRV or ERV packaged together with the controls, the timers and the repeaters.
General Rule of Interpretation (GRI) 1, HTSUSA, states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes. Goods that are, prima facie, classifiable under two or more headings, are classifiable in accordance with GRI 3, HTSUSA. GRI 3(a) states in part that when two or more headings each refer to part only of the items in a set put up for retail sale, those headings are to be regarded as equally specific, even if one heading gives a more precise description of the good.
In scenario 2, the good consists of at least two different articles that are, prima facie, classifiable in different subheadings. It consists of articles put up together to carry out a specific activity (providing balanced ventilation). Finally, the articles are put up in a manner suitable for sale directly to users without repacking. Therefore, the good in question is within the term "goods put up in sets for retail sale." GRI 3(b) states in part that goods put up in sets for retail sale, which cannot be classified by reference to 3(a), are to be classified as if they consisted of the component which gives them their essential character. The factor or factors which determine essential character varies with the goods under consideration. Explanatory Note Rule 3(b)(VIII) lists factors such as the nature of the material or component, their bulk, quantity, weight or value and the role of a constituent material in relation to the use of the good. It is the opinion of this office that the essential character of this set is imparted by the HRV and ERV mechanical ventilation systems.
The applicable subheading for the Lifebreath Heat Recovery Ventilators and the Lifebreath Energy Recovery Ventilators when sold alone or together with the controls, timers and repeaters will be 8479.89.6500, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and mechanical appliances: Other: Electromechanical appliances with self-contained electric motor: Other”. The rate of duty will be 2.8 percent ad valorem.
You also request classifications for the separately imported controls, timers and repeaters.
The applicable subheading for the Lifebreath Digital Control 99-DXPL02 (generic model of DXLP02), the Lifebreath Ventilation Control 99-BCO2, and the Lifebreath Ventilation Control 99-BC03 will be 9032.89.6070, HTSUS, which provides for “Automatic regulating or controlling instruments and apparatus; parts and accessories thereof: Other instruments and apparatus: Other: Other: Process control instruments and apparatus: Other: Humidity control instruments”. The rate of duty will 1.7 percent ad valorem.
The applicable subheading for the repeaters will be 8517.62.0090, HTSUS, which provides for “Telephone sets, including telephones for cellular networks or for other wireless networks; other apparatus for the transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network), other than transmission or reception apparatus of heading 8443, 8525, 8527 or 8528; parts thereof: Other apparatus for transmission or reception of voice, images or other data, including apparatus for communication in a wired or wireless network (such as a local or wide area network): Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus: Other.” The general rate of duty will be Free.
Effective July 6, 2018, the Office of the United States Trade Representative (USTR) imposed an additional tariff on certain products of China classified in the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(b), HTSUS. The USTR imposed additional tariffs, effective August 23, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(d), HTSUS. Subsequently, the USTR imposed further tariffs, effective September 24, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(f) and U.S. Note 20(g), HTSUS. For additional information, please see the relevant Federal Register notices dated June 20, 2018 (83 F.R. 28710), August 16, 2018 (83 F.R. 40823), and September 21, 2018
(83 F.R. 47974). Products of China that are provided for in subheading 9903.88.01, 9903.88.02,
9903.88.03, or 9903.88.04 and classified in one of the subheadings enumerated in U.S. Note 20(b), U.S. Note 20(d), U.S. Note 20(f) or U.S. Note 20(g) to subchapter III shall continue to be subject to antidumping, countervailing, or other duties, fees and charges that apply to such products, as well as to those imposed by the aforementioned Chapter 99 subheadings.
Products of China classified under subheading 9032.89.6070, HTSUS, unless specifically excluded, are subject to the additional 25 percent ad valorem rate of duty. At the time of importation of the controls, you must report the Chapter 99 subheading, i.e., 9903.88.01, in addition to subheading 9032.89.6070, HTSUS, listed above.
Guidance in a situation where sets packaged for retail sale are involved is provided on the CBP website in “CBP Section 301 Trade Remedies Frequently Asked Questions”. The answer to “How are the Section 301 duties assessed in respect to sets packaged for retail sale, which contain components covered by the Section 301 remedy,” reads, in pertinent part, as follows:
When importing goods put up in sets for retail sale (in accordance with General Rule of Interpretation 3) that contain articles subject to the Section 301 remedy, if the product that imparts the essential character to the set (i.e. the HTSUS provision under which the entire set is classified) is covered by the Section 301 remedy, then the entire set will be subject to the additional 25% duties.
If the HTSUS provision under which the entire set is classified is not covered by the Section 301 remedies, but the set contains components that are classified in a subheading covered by the 301 list, the 301 duties will not be assessed on the individual components.
Following this guidance, the sets of a HRV or ERV packaged together with the controls, repeater and timers, will not be subject to the Section 301 remedy as the HTSUS provision under which the entire set is classified is not covered by the Section 301 remedies.
The tariff is subject to periodic amendment so you should exercise reasonable care in monitoring the status of goods covered by the Notice cited above and the applicable Chapter 99 subheading.
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 the World Wide Web at https://hts.usitc.gov/current.
Your inquiry does not provide enough information for us to give a classification ruling on the Lifebreath Ventilation Control 99-BCO4 and control models GBC02, GBC03, and the GBC04.
Please describe how each device functions. Do these devices control or modify humidity levels within a specific area? Do these devices initiate the operation of a ventilation apparatus based upon humidity levels? Do these devices have a component that measures or senses humidity levels? If so, identify the device’s internal mechanism that measures or senses humidity levels by name and explain how the mechanism operates.
In addition, your inquiry does not provide enough information for us to give a classification ruling on the timers, model numbers 99-DET01 and 99-DET02. Does the time switch have a clock or watch movement, or a synchronous motor? Is it valued over $5 each? Indicate the timers’ country of origin.
When this information is available, you may wish to consider resubmission of your request. We are returning any related samples, exhibits, etc. If you decide to resubmit your request, please include all of the material that we have returned to you.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Patricia O’Donnell at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division