CLA-2-84:OT:RR:NC:N1:104
Mr. Nury Lewis
NL Cargo Inc.
8600 N.W. 30th Terrace
Miami, FL 33122
RE: The tariff classification of components of an aluminum smelting plant from Germany and Austria
Dear Mr. Lewis:
In your letter dated May 8, 2015 on behalf of Atio USA LLC, you requested a tariff classification ruling.
The goods under consideration are components of an Aluminum Alloy Smelting Plant. Components of this plant are manufactured in different European countries and shipped to the United States where they will be assembled into one plant. Upon arrival, Part A is transported to a bonded warehouse where it will await the arrival of Part B. Once both parts have arrived and a suitable location for the plant has been determined, they will be withdrawn together from the bonded warehouse for formal entry into the United States. Part C, i.e., the steel structure/enclosure is manufactured in the United States. The purpose of this plant is said to be the recycling of aluminum into usable forms.
Part A of the Aluminum Smelting Plant consists of various unassembled components of a furnace intended to be installed into a metallic structure to complete the furnace. Together the furnace components of Part A smelt aluminum scrap, which is used to produce different alloys, such as magnesium, titanium, manganese, etc. Invoices indicate the components imported for Plant A are a 45 ton oven, a 40 ton oven, a slab foundation for the ovens, an aluminum stirrer system, a sampling system placed under the oven, an air burner system, a hydraulic power pack, tilting cylinders, a heat exchange assembly, a cold air burner system and electrical connections. Also, included are hydraulic hoses and steel or carbon pipes that will be used to supply gas to the burners. The smelting process that will occur in Part A is described with aluminum being introduced into a stationary oven and continuing to the tilting oven, which pours the melted aluminum into the casting line. Part A is manufactured in Germany.
The Harmonized Commodity Description and Coding System Explanatory Notes (“ENs”) constitute the official interpretation of the Harmonized System. While not legally binding, the ENs provide a commentary on the scope of each heading of the Harmonized Systems and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989). The ENs to heading 8417 lists industrial ovens and furnaces that melt metal. Part A has the essential characteristics of a furnace that smelts aluminum.
Part B consists of various components of a continuous casting machine and slug saw line. These components include machines such as the casting machine, the flying saw, the billet saw and conveyors. This line is manufactured in Austria.
Parts A and B are entered separately into a bonded warehouse to be subsequently withdrawn together. It is well-established that articles are classified in the condition as imported. However, warehoused goods represent an exception to the general rule. While technically "imports," foreign-made goods stored in a bonded warehouse remain exempt from duties and taxes until either they are withdrawn or five years pass from the date of importation. 19 U.S.C. § 1557(a) noted. In this case, Parts A and B, while shipped at different times, are withdrawn together from a bonded warehouse for on-site assembly.
Parts A and B consist of components which are classifiable within different headings and are different machines. However, they do not form a composite machine because they are not "fitted together to form a whole." The Explanatory Notes define "fitted together to form a whole" as incorporating one machine within the other, mounting one on the other, or mounting both machines on a common base or frame or in a common housing. The machines are not incorporated into one another, mounted onto the other or in a common housing. The submitted information on the bases indicates that the foundations for each part are separate slabs. It is said that “Both slabs can be connected if desired, subject to the floor and soil resistance, but this is not indispensable as they are connected to each other through conveyors and pipes …”. In addition, General Explanatory Note (VI) to Section XVI states that “Floors, concrete bases, …, even if specially fitted out to accommodate machines …, should not be regarded as a common base joining such machines or appliances to form a whole”. Thus, as the parts would not be considered mounted on a common base, Parts A and B would not be considered a composite machine within Section XVI, Note 3, Harmonized Tariff Schedule of the United States (“HTSUS”). Section XVI, Note 4, HTSUS, addresses functional units. The note states “Where a machine...consists of individual components (whether separate or interconnected by piping, by transmission devices, by electric cables or by other devices) intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function”. The Explanatory Notes state that a "functional unit" covers only those "machines and combination of machines essential to the performance of the function specific to the functional unit as a whole..." Parts A and B, when withdrawn together from the bonded warehouse, contribute together to the clearly defined function of casting.
Therefore, in accordance with Section XVI, Note 4, the applicable subheading for Parts A and B, as described above, will be 8454.30.0090, HTSUS, which provides for “Converters, ladles, ingot molds and casting machines, of a kind used in metallurgy or in metal foundries, and parts thereof: Casting machines … Other”. The rate of duty will be 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/.
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,
Gwenn Klein Kirschner
Director
National Commodity Specialist Division