CLA-2-84:OT:RR:NC:N1:104
Laurie Montizambert
Trade Compliance Supervisor
Price Industries Limited
638 Raleigh Street
Winnipeg, MB, R2K 3Z9
Canada
RE: The tariff classification of electric air handling units from Canada
Dear Ms. Montizambert:
In your letter dated October 4, 2022, you requested a tariff classification ruling.
Two items are under consideration. Item 1 is referred to as the DBA SolutionAir Air Handling Unit (AHU), and Item 2 is referred to as the AHU-DX Air Handling Unit with the Cooling/Dehumidification package (AHU-DX). Both items are electrically powered, intended for industrial or commercial use, designed for installation on rooftops, and will be connected to the building’s ductwork. Both items are housed within an aluminum or steel cabinet consisting of doors, vents, and panels. The units will not include a controller at the time of importation.
Item 1, the AHU, is designed to provide fresh ambient and/or recycled air to, and circulate and distribute within, a building. It is also capable of providing building heat using an electric coil. The unit will be comprised of debris filters, a fan(s), an electric heating coil, dampers, and controls. It is unable to change humidity. At the time of importation, the AHU will also include an energy recovery system, which we understand functions to recover sensible (temperature) and/or latent (humidity) energy that is exhausted from the building.
Item 2, the AHU-DX air handling unit, is equipped with a heating coil and a DX cooling/DX dehumidification option, which consists of an evaporator, a condenser, fans, expansion valves, and upon a customer’s request, a compressor. The unit is said to function as a central station air conditioning unit that distributes air via a ducting system. The unit is used with the Detect + Protect Monitoring System and can be connected to a system via a LAN or when necessary, via a cellular modem.
The Harmonized Commodity Description And Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the notes should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
The ENs to heading 8479 state that machines and mechanical appliances of heading 84.79 are those having individual functions which are not covered more specifically by any other heading in the HTSUS, and which cannot be classified in any other particular heading of the HTSUS since no other heading covers it by reference to its method of functioning, description or type, and no other heading covers it by its reference to its use or to the industry in which it is employed, or because it is a general purpose machine.
The subject AHU meets the description of machines of heading 84.79 and is not more specifically covered by any other HTSUS heading. While the AHU differs in certain respects to the air handler units and heat recovery ventilators previously reviewed by this office and classified in heading 8479, e.g., HQ 958473 (Feb. 8, 1996), HQ 958729 (Feb. 5, 1996), HQ 958730 (Feb. 5, 1996), and N103203 (May 24, 2010), the AHU shares those articles’ principal function of ventilating, conditioning, and circulating air inside a building.
You state that the AHU’s primary function is to provide building heat. We disagree. While the AHU can heat incoming air using an electric heat assembly, you state that this feature is not always used. Rather, the AHU will carry out its primary function of filtering airborne particles from outside, ventilating, and circulating air, regardless of whether the incoming air is heated. Therefore, neither classification in HTSUS heading 8516, providing for electric space heaters, nor heading 8419, covering articles used for the treatment of materials or objects using a change of temperature, is appropriate.
The applicable subheading for the AHU will be 8479.89.6500, 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 general rate of duty is 2.8 percent ad valorem. We note that the inclusion of an energy recovery system in the subject AHU is inconsequential to the classification of the AHU. The AHU performs multiple functions beyond recovering sensable and/or latent heat/energy, and in any event various types of energy recovery systems, including those imported as part of complete heat recovery ventilation systems that exhaust and circulate stale air, have also been classified in subheading 8479.89.6500. See, e.g., N303278 (May 3, 2019); HQ H252413 (Apr. 5, 2016); HQ 958473; N103203.
The applicable subheading for item 2, the AHU-DX Air Handling Unit with the Cooling/Dehumidification package, will be 8415.82.0135, which provides for Air conditioning machines, comprising a motor-driven fan and elements for changing the temperature and humidity, including those machines in which the humidity cannot be separately regulated; parts thereof: Other, except parts: Other, incorporating a refrigerating unit: Room or central station air conditioning units for use with water chillers: Central Station Air Handlers. The general rate of duty is 2.2 percent ad valorem.
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 at https://hts.usitc.gov/current.
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 Arthur Purcell at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division