CLA-2 OT:RR:CTF:TCM H044560 JER
Port of Newark
U.S. Customs and Border Protection
1100 Raymond Boulevard, Suite 402
Newark, NJ 07102
RE: Application for Further Review of Protest No. 4601-08-101390; Electric Acutator/Motor
Dear Port Director:
This is our decision regarding the Application for Further Review of Protest No. 4601-08-101390, timely filed on behalf of Belimo Automation, A.G., (“Protestant”), concerning the classification of “electric actuators/motors” under the Harmonized Tariff Schedule of the United States (“HTSUS”).
In reaching our decision, additional consideration was given to Protestant’s supplemental submission dated July 31, 2009.
The subject merchandise is an electric actuator, comprised of an electric motor, a gear box, and control electronics, which include: a printed circuit board (“PCB”) and an application specific integrated circuit system (“ASIC electronics”). The actuator is one of three components in a heating air conditioning climate-control (“HVAC”) system. According to the submission, “an HVAC control system consists of three essential elements: a climate sensor, an automatic climate regulator and an actuator.” Both the sensor and the climate controller/regulator are external to the actuator assembly and are not part of the import in question.
The climate sensor monitors ambient conditions in the room or air duct and reports temperature, humidity and/or rate of air flow to the HVAC controller. The HVAC automatic regulator receives information from the sensor(s), processes it, and signals the actuator to provide the mechanical force to open or close a damper or valve precisely to adjust and control the flow of climate-controlled air.
Additionally, the ASIC electronics measure the power level (voltage and amperes) of the input signal from the HVAC regulator and automatically adjusts the actuator’s motor level of impedance (electrical resistance measured in Ohms) to match it. The programming of the ASIC electronics determines the speed of damper rotation and the input signal sent to the motor. The ASIC electronics reads an electrical pulse to track the damper’s current position based on the position of the actuator gears…the ASIC electronics communicates the pulse count to the HVAC regulator. As the electronics communicates the current position of the damper and notes the direction in which the damper is moving (toward open or toward closed), the regulator records this information. By recording the damper location, the regulator can determine where the damper needs to be in order to properly supply conditioned air to the interior space.
The subject merchandise has two separate functions in addition to the motor function, which are: to match the incoming power level from the HVAC automatic regulator to the electrical resistance of the actuator motor, and to track and report to the HVAC automatic regulator, the location of the damper with its operational range. The ASIC electronics also provides “end-stop protection” which allows the actuator to ignore commands from the HVAC regulator when the gear has reached the end of its range and further movement is no longer possible. This enables the apparatus to avoid “wasteful loss of energy and premature destruction of the actuator motor.”
The merchandise at issue was entered between February 9, 2007 and February 26, 2007, respectively. The Port liquidated the subject merchandise between December 21, 2007 and January 11, 2008, under heading 8501, HTSUS. Further Review of Protest No. 4601-08-101390 was properly accorded to Protestant pursuant to 19 C.F.R. § 174.24 (b) because the matter involves questions of law or fact which have not been ruled upon by the Commissioner of Customs or his designee.
Whether the subject merchandise is classifiable in heading 8501, HTSUS, as an electric motor, under heading 8415, HTSUS, as a part of an air conditioning machine or under heading 9032, HTSUS, as a part of an automatic regulator.
LAW AND ANALYSIS:
Initially, we note that the matter protested is protestable under 19 U.S.C. § 1514(a)(2) as a decision on classification. The protest was timely filed, within 180 days of liquidation, on June 17, 2008, pursuant to Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, § 2103(2)(B)(ii), (iii) (codified as amended at 19 U.S.C. § 1514(c)(3) (2006).
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). 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 2 through 6 may then be applied in order.
The 2007 and 2008 HTSUS provisions under consideration are as follows:
8501 Electric motors or generators (excluding generating sets):
8501.10 Motors of an output not exceeding 37.5 W:
Of under 18.64 W:
8415 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:
9032 Automatic regulating or controlling instruments and apparatus; parts and accessories thereof:
Other instruments and apparatus:
Automatic voltage and voltage-current regulators:
Control instruments for air conditioning, refrigeration or heating systems:
Note 2 (a) to Section XVI, HTSUS, which includes Chapter(s) 84 and 85, provides, in pertinent part, as follows:
Subject to note 1 to this section, note 1 to chapter 84 and to note 1 to chapter 85, parts of machines (not being parts of the articles of heading 8484, 8544, 8545, 8546 or 8547) are to be classified according to the following rules:
(a) Parts which are goods included in any of the headings of chapter 84 or 85 (other than headings 8409, 88431, 8448, 8466, 8473, 8487, 8503, 8522, 8529, 8538 and 8548) are in all cases to be classified in their respective headings [.]
Note 2 (a) to Chapter 90, HTSUS, provides, in pertinent part, as follows:
Subject to note 1 above, parts and accessories for machines, apparatus, instruments or articles of this chapter are to be classified according to the following rules:
(a) Parts and accessories which are goods included in any of the headings of this chapter or of chapter 84, 85 or 91 (other than headings 8477, 8548 or 9033) are in all cases to be classified in their respective headings [.]
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While not 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 (August 23, 1989).
The ENs to heading 9032, HTSUS, provide in relevant part, as follows:
Automatic regulators are connected to an electrical, pneumatic or hydraulic actuator, which brings the controlled variable back to the desired value…The actuators are to be classified in their own appropriate headings....[.]
The ENs to heading 8501, HTSUS, explain that:
Motors remain classified here even where they are equipped with pulleys, with gear boxes, or with a flexible shaft for operating hand tools.
Counsel for the Protestant asserts that the subject actuator assembly is classifiable as a “part” of an automatic regulator of heading 9032, HTSUS, by application of Note 3 to Chapter 90, HTSUS, because the principal function of the subject merchandise is the automatic regulation of conditioned air. Protestant concludes that the subject merchandise is not classifiable as an actuator of heading 8501, HTSUS, because the subject merchandise “include[s] significant additional electronic components having functions of an automatic regulator rather than an actuator.” In support of this position, Protestant cites among other rulings, Headquarters Ruling Letter (“HQ”) 962289, dated June 24, 1999 and New York Ruling Letter (“NY”) N021646, dated February 1, 2008, wherein CBP considered the classification of electric actuators with additional components.
First we consider whether the ASIC electronics, as an additional component, is sufficient to preclude classification of the whole from heading 8501, HTSUS. The question of whether an electric motor consisting of additional components remains classifiable as a motor under heading 8501, HTSUS, is well settled. In HQ 086832, dated May 21, 1990, we stated “that a motor remains a motor for tariff purposes despite having other articles attached to it.” We further noted that “[t]hese other articles can be quite substantial.” Likewise, in HQ 955037, dated February 14, 1994, concerning the classification of electric actuators/motors, CBP explained that:
An electric motor is classifiable under heading 8501, HTSUS, even when imported with additional components (other than those listed in Explanatory Note 85.01) if:
(1) those additional components complement the function of
the motor [HQ 083955];
(2) those additional components are devices which motors are commonly equipped [HQ 087909];
(3) those additional components serve merely to transmit the
power the motors produce [HQ 950557].
While there is no dispute that the gear box and PCB meet the criteria stated above, Protestant asserts that the ASIC does not satisfy any of the three qualifications stated. Specifically, Protestant asserts that the ASIC does not complement the function of the motor; that actuators are not commonly equipped with ASIC electronics; and that the ASIC does not serve to transmit the power which the motor produces.
Previous CBP decisions involving electric motors consisting of additional components demonstrate that satisfaction of all three qualifications is not required for electronic motors to remain classified in heading 8501, HTSUS. In the instant case, it is clear that the ASIC electronics complement the function of the actuator. For example, Protestant attests that “the purpose of the new additional device [ASIC] in the imported devices is to regulate and control the motor function…” Protestant further states that “the ASIC component makes the actuator work properly with any HVAC automatic regulator for the purpose of exact damper positioning.” Unlike the article classified in HQ 962289, wherein CBP determined that certain additional components did not relate to the function of the reel motors, the ASIC component of the subject merchandise automatically adjusts the actuator motor’s electrical resistance to match the power level of the input signal from the HVAC regulator. As Protestant explains, “[t]he programming of the ASIC electronics determines the speed of damper rotation and the input signal sent to the motor.” Moreover, the Protestant explains that the ASIC electronics eliminates “end-stop pulsing” by allowing the “actuator motor to ignore commands from the HVAC automatic regulator” [when the] “gear has reached the end of its range and further movement is not possible.” All of which serves to complement the functioning of the instant motor in relation to the damper location and the primary purpose of the actuator assembly as a whole.
Several CBP Rulings have classified electric motors consisting of “additional components” under heading 8501, HTSUS. For example, in HQ 083955, dated July 10, 1989, CBP classified an electric motor in heading 8501, HTSUS, which was used in industrial type sewing machines. The needle positioner motor of HQ 083955 performed its clutching, starting, braking and stopping function by means of a “microprocessor” which utilized electromagnetic waves. The “needle positioner” motor of HQ 083955 also performed additional functions such as positioning the needle, sending signals to alert the machine to sever the sewing thread, or to reverse directions. Similarly, in HQ 086832, dated May 21, 1990, CBP classified a “spindle motor” used with automatic data processing machines (“ADP”) in heading 8501, HTSUS. The spindle motor served as the platform for mounting a memory discs which stored data in hard drives. We noted in HQ 086832 that although spindle motors are parts of ADPs, they are specifically provided for in heading 8501, HTSUS. See also, HQ 952500, dated October 16, 1992. (Which addressed the question of whether the addition of an “optical encoder” removed an electric motor from heading 8501, HTSUS).
Protestant admits that without the ASIC electronics, the subject merchandise “likely would be classified as electric motors under HTSUS heading 8501.” Yet, CBP rulings demonstrate that even where an electric motor of heading 8501, HTSUS, consists of control electronics such additional components do not remove the article from heading 8501, HTSUS. For instance, in HQ 955037, dated February 15, 1994, CBP classified an electric motor that featured a “sensor device” which controlled the movement of a jack mechanism in heading 8501, HTSUS. In NY N030575, dated June 27, 2008, CBP classified an actuator assembly which included a PCB with a micro-controller. The PCB micro-controller had the capacity to control the electric motor by forwarding an electric signal from a control switch within a Sports Utility Vehicle. Likewise, in NY N021646, CBP classified two electric air conditioner motors referred to respectively as an indoor “smart motor” and an outdoor “smart motor.” Both smart motors were classified in heading 8501, HTSUS. In NY N021646, we noted that the control electronics contained in the “smart motor” incorporated a central processing unit (“CPU”) chip. A CPU chip is a microprocessor which is a complete computation engine fabricated onto a single chip and has the capacity to execute a myriad of instructions and/or decisions.
Protestant contends that the “smart motors” of NY N021646 are substantially different from the subject merchandise as Protestant believes that the entire outdoor unit and indoor unit are similar to the subject merchandise rather than the smart motors themselves. Protestant also asserts that HVAC actuators of NY N0518226, dated March 11, 2009, are distinguishable from the subject merchandise because “the subject merchandise has significant additional electronics that incorporate functions of the controller component of the HVAC system as a whole.” We find Protestant’s reasoning to be unpersuasive. Similar to the instant ASIC electronics, the control electronics of NY N021646 “allowed the motor to receive operating signals from the PCB. Based on those signals the smart motor controlled the air flow within the condenser by powering a fan.” Likewise, the HVAC actuators of NY N051826 incorporated an electric motor, gears and control electronics as does the subject merchandise. Moreover, like the instant merchandise, the articles of NY N021646 and NY N051826, are composite goods which consist of an electric motor, gears and control electronics in the same housing. The degree to which the control electronics function does not remove these articles from heading 8501, HTSUS, so long as the control electronics complement the function of the motor, are components which such motors are commonly equipped or serve merely to transmit the power the motor produces. In keeping with the rationale used in HQ 955037, HQ 083955, NY N021646, NY N051826 and NY N030575, the presence of control electronics does not remove an electric motor from heading 8501, HTSUS.
Finally, in Nidec Corporation v. United States, 861 F. Supp. 136; (Ct. Int’l Trade 1994), aff'd. 68 F. 3d 1333 (Fed. Cir. 1995), the Court classified an actuator electric motor used in an automatic data processing machine (ADP) as an electric motor despite arguments that the presence of additional components made the goods something more than an electric motor. In Nidec, the Court found that “the essence of the goods was still that of a motor, not of a spindle,” thus precluding classification as something more than an electric motor. Nidec at 143. Protestant asserts that the separate classification of a PCB assembly, in Nidec, distinguishes the subject actuator from the actuator of Nidec. We find that reasoning to be flawed. The PCB assembly in Nidec, unlike the instant ASIC electronics, was a separate article which only worked in conjunction with the motor in Nidec. In the instant case, the ASIC electronics are housed together with the motor and are not a separate article of commerce but rather an additional component of the actuator assembly itself. Accordingly, we find that the ASIC electronics of the subject merchandise are substantially similar to the aforementioned additional electronic components, none of which have been precluded from heading 8501, HTSUS.
Next, we consider whether the subject merchandise is classifiable as a part of an automatic regulator, for tariff purposes. It is well settled that even where an article is designed to work solely or principally as a part of a machine, a provision for parts does not prevail over a specific provision for such parts. See Additional U.S. Rules of Interpretation 1(c); see also, Nidec, at 141. As the Court in Nidec pointed out “parts which in themselves constitute an article covered by a heading of this Section…are in all cases classified in their own heading even if specifically designed to work as a part of a specific machine.” Id, at 141. The Court added that the “ENs [to Section XVI] also provide that ‘it applies in particular to ….electric motors.’” See id, at 142.
Although the subject merchandise is principally used with an HVAC automatic regulator system, Note 2 (a) to Ch. 90 precludes classification of parts or accessories which are goods included in Chapter 85, HTSUS. Note 2 (a) to Ch. 90 provides, in relevant part, that: “[p]arts and accessories which are goods included in any of the headings of this chapter or of chapter 84, 85 or 91…are in all cases to be classified in their respective headings.” [Emphasis added]. Likewise, Note 2 (a) to Section XVI, precludes classification of this article as a part of an HVAC regulator in heading 9032, HTSUS. Note 2 (a) to Section XVI states, in relevant part, that: “[p]arts which are goods included in any of the headings of chapters 84 and 84 are in all cases to be classified in their respective headings.” Additionally, the ENs to 9032 state that “actuators are to be classified in their own appropriate headings…” As such, even if the subject merchandise were considered to be a part of the HVAC automatic regulator, it would still be classified in its own appropriate heading. In the instant case, electrical motors are provided for eo nomine in heading 8501, HTSUS. See e.g., NY F80523, February 10, 2000, which classified “damper doors and damper actuating levers” also referred to as “flow control parts” for an automotive HVAC system, in heading 8481, HTSUS; see also, HQ 086832, cited above.
Based on all the aforementioned, we find that the subject actuator which consists of ASIC electronics, is described eo nomine by the terms of heading 8501, HTSUS, and as a good of Ch. 85 is precluded from classification as a “part” in heading(s) 9032 and 8415, HTSUS, pursuant to Note 2 (a) to Ch. 90 and Note 2 (a) to Section XVI, HTSUS.
By application of GRI 1 and Note 2 (a) to Section XVI and Note 2 (a) to Ch.90, the subject merchandise is classified in heading 8501, HTSUS. It is specifically provided for under subheading 8501.10.4040, HTSUS, which provides for “Electric motors or generators (excluding generating sets): Motors of an output not exceeding 37.5W: of under 18.64 W: Other: Brushless.” The 2007 and 2008 column one, general rate of duty was 4.4% ad valorem.
Since the rate of duty under the classification indicated is the same as the liquidated rate, you are instructed to deny the protest in full. In accordance with the Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision.
No later than 60 days from the date of this letter, the Office of International Trade, Regulations and Rulings will make the decision available to CBP personnel, and to the public on the CBP homepage on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Myles B. Harmon, Director
Commercial and Trade Facilitation Division