CLA-2 OT:RR:CTF:TCM H274139 LWF
Mr. Robert L. Soza, Jr.
Jackson Walker LLP
112 East Pecan St., Suite 2400
San Antonio, TX 78205
Re: Revocation of New York Ruling Letter (NY) I81272, dated May 21, 2002; tariff classification of parallel reaction stations for organic chemistry
Dear Mr. Soza:
This letter is to inform you that U.S. Customs and Border Protection (CBP) has reconsidered New York Ruling Letter (NY) I81272, dated May 21, 2002, issued to your client Genevac, Inc. (“Genevac”), concerning the tariff classification under the Harmonized Tariff Schedule of the United States (HTSUS) of certain parallel reaction stations for organic chemistry. Upon review of the ruling letter, CBP has determined the tariff classification decision set forth in NY I81272 to be in error. Accordingly, for the reasons explained below, CBP is revoking the ruling letter.
Pursuant to section 625(c), Tariff Act of 1930 (19 U.S.C. §1625(c)), as amended by section 623 of title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057), notice of the proposed action was published in the Customs Bulletin, Vol. 51, No. 32, on August 9, 2017. No comments were received in response to the notice.
FACTS:
The merchandise at issue consists of four machines used in scientific laboratories for the study of organic chemistry for the development of pharmaceutical compounds. Genevac identifies the individual machines as the: (1) “GreenHouse Parallel Synthesiser,” (2) “Carousel Reaction Station,” (3) “Metz Heater Shaker,” and (4) “Metz Syn10 Reaction Station.” See Figs. 1-4, below.
Collectively, the machines are identified as “parallel reaction stations,” because they are used by organic chemists to conduct simultaneous (“parallel”) chemical reactions via the heating, cooling, and/or stirring or shaking of chemical compounds in reaction tubes within the machines. During chemical synthesis, the reaction tubes are filled with chemical compounds, and a temperature gradient is applied to the contents of the reaction tube to provoke chemical reactions, thereby creating or modifying molecules for further analysis. Common to the design of each of the four parallel reaction stations, the machines are engineered to evenly heat or cool multiple reaction tubes placed into the devices.
In ruling letter NY I81272, CBP classified each of the parallel reaction stations under heading 8479, HTSUS, which provides for “Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof.”
Fig. 1: GreenHouse Parallel Synthesiser
Fig. 2: Carousel Reaction Station
Fig. 3: Metz Heater Shaker
Fig. 4: Metz Syn10 Reaction Station
Fig. 1: GreenHouse Parallel Synthesiser
The GreenHouse Parallel Synthesiser holds 24 reaction tubes and allows chemists to perform 24 reactions in parallel, with a reaction volume of 0.5 to 3ml per reaction tube. The base of the machine consists of a magnetic stirring hotplate, upon which is mounted an aluminum base and glass enclosure for 24 reaction tubes. The top of the machine features 24 individual, magnetically-driven vertical stirring elements, a water-cooled aluminum reflux head with nickel condensing fingers to condense reaction vapors, an inlet/outlet for vacuum and inert gasses, and a temperature/time controller. The stirring hotplate is capable of creating a magnetic field that spins the vertical stirring elements at speeds of up to 1,100 RPM, and the machine’s heating element (and removable cooling reservoir) allows the GreenHouse Parallel Synthesiser to warm or cool reaction samples between -70°C and 150°C. The aluminum base evenly conducts heat to and way from all reaction tubes, and the machine is capable of controlling temperature uniformity with an accuracy of +/-0.5°C.
Fig. 2: Carousel Reaction Station
The Carousel Reaction Station is a machine identified by similar form and function to that of the GreenHouse Parallel Synthesiser. The Carousel Reaction Station is capable of holding 12 reaction tubes.
Fig. 3: Metz Heater Shaker
The Metz Heater Shaker is a parallel reaction station that is designed to evenly heat reaction tubes within a range of 5°C and 150°C. Unlike the GreenHouse Parallel Synthesiser, Carousel Reaction Stations, and Metz Syn10 Reaction Station, the Metz Heater Shaker is not equipped with a stirring mechanism, but instead features a microprocessor-controlled shaking action that is capable of operating between 100 t0 600rpm.
Fig. 4: Metz Syn10 Reaction Station
The Metz Syn10 Reaction Station is a machine identified by similar form and function to that of the GreenHouse Parallel Synthesiser and Carousel Reaction Station. However, unlike the other parallel reaction stations, the design of the Metz Syn10 Reaction Station allows an operator to apply different temperatures and/or stirring speeds to each of the individual reaction tubes that are placed within the machine.
ISSUE:
Whether the parallel reaction stations are classifiable under heading 8419, as laboratory equipment, whether or not electrically heated, for the treatment of materials by a process involving a change of temperature, or heading 8479, as machines and mechanical appliances having individual functions, not specified or included elsewhere in Chapter 84.
LAW AND ANALYSIS:
Merchandise imported into the United States is classified under the HTSUS. Tariff classification is governed by the principles set forth in the General Rules of Interpretation (GRIs) and, in the absence of special language or context which requires otherwise, by the Additional U.S. Rules of Interpretation. The GRIs and the Additional U.S. Rules of Interpretation are part of the HTSUS and are to be considered statutory provision of law for all purposes. GRI 1 requires that classification be determined first according to the terms of the headings of the tariff schedule and any relative section or chapter notes and, unless otherwise required, according to the remaining GRIs taken in their appropriate order.
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System at the international level. While neither legally binding nor dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are generally indicative of the proper interpretation of the heading. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
With respect to the tariff classification of the parallel reactions stations, the relevant HTSUS provisions state, as follows:
8419 Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 8514), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting, distilling, rectifying, sterilizing, pasteurizing, steaming, drying, evaporating, vaporizing, condensing or cooling, other than machinery or plant of a kind used for domestic purposes; instantaneous or storage water heaters, nonelectric; parts thereof
8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof
* * * * *
Note 2 to Chapter 84, HTSUS, states, in relevant part:
2. Subject to the operation of Note 3 to Section XVI and subject to Note 9 of this chapter, a machine or appliance which answers to a description in one or more of the headings of 8401 to 8424, or heading 8486 and at the same time to a description in one or more of the heading 8425 to 8480 is to be classified under the appropriate heading of the former group or under heading 8486, as the case may be, and not the latter group.
Heading 8419 does not, however, cover:
[…]
(e) Machinery, plant or laboratory equipment, designed for mechanical operation, in which a change of temperature, even if necessary, is subsidiary.
* * * * *
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, the ENs provide a commentary on the scope of each heading of the HTS and are thus useful in ascertaining the proper classification of merchandise. It is CBP’s practice to follow, whenever possible the terms of the ENs when interpreting the HTSUS. See T.D. 89-90, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The EN to heading 84.19, HS, provides, in relevant part, as follows:
[T]the heading covers machinery and plant designed to submit materials (solid, liquid or gaseous) to a heating or cooling process in order to cause a simple change of temperature, or to cause a transformation of the materials resulting principally from the temperature change (e.g., heating, cooking, roasting, distilling, rectifying, sterilising, pasteurising, steaming, drying, evaporating, vaporising, condensing or cooling processes). But the heading excludes machinery and plant in which the heating or cooling, even if essential, is merely a secondary function designed to facilitate the main mechanical function of the machine or plant, e.g., machines for coating biscuits, etc., with chocolate, and conches (heading 84.38), washing machines (heading 84.50 or 84.51), machines for spreading and tamping bituminous road surfacing materials (heading 84.79).
The machinery and plant classified in this heading may or may not incorporate mechanical equipment.
[…]
(VII) MACHINERY FOR LIQUEFYING AIR;
SPECIAL LABORATORY APPARATUS AND EQUIPMENT
The heading includes machines of the Linde or Claude type used for the liquefaction of air.
The heading further includes specially designed laboratory apparatus and equipment, generally small in size (autoclaves, distilling, sterilising or steaming apparatus, dryers, etc.), but it excludes demonstrational apparatus of heading 90.23, and measuring, checking, etc., apparatus more specifically covered by Chapter 90. (Emphasis original.)
* * * * *
Heading 8419, HTSUS, provides for “machinery, plant or laboratory equipment… for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting, […] or cooling[.]” However, Note 2(e) to Chapter 84, HTSUS, states that, “the heading excludes machinery, plant or laboratory equipment in which a change of temperature, even if necessary, is subsidiary. See also EN 84.19, HS (“But the heading excludes machinery and plant in which the heating or cooling, even if essential, is merely a secondary function designed to facilitate the main mechanical function of the machine or plant[.]”). Consequently, while the text of heading 8419, HTSUS, requires only that laboratory equipment of heading involve a change of temperature, Note 2(e) to the Chapter instructs that the heating or cooling function serve as a non-subsidiary purpose of such machines.
CBP has previously examined the classification of laboratory equipment under heading 8419, HTSUS. Specifically, in Headquarters Ruling Letter (HQ) 965366, dated September 24, 2002, CBP classified a polymerase chain reaction (PCR) machine used to duplicate DNA or RNA under heading 8419, HTSUS, because it found that the machine’s ability to heat samples to a precise temperature was of principal importance to the function of the PCR machine. There, the first step of the PCR process involved precisely heating a DNA or RNA sample material to 94-96°C to facilitate the separation of the sample’s helix strands. Absent this temperature change, the remaining steps of the PCR process cannot take place and duplication of the genetic material within the machine would be impossible. CBP therefore determined that the PCR machine’s temperature function resulted in a non-subsidiary treatment of material (i.e. the separation of DNA or RNA helix strands), as described under heading 8419, HTSUS, and Note 2(e) to Chapter 84. The United States Court of International Trade (CIT) affirmed CBP’s conclusions in ruling letter HQ 965366, holding that the treatment of DNA and RNA materials by a change in temperature was central to the function of the PCR machine and that “the specialized nature of the [PCR machine] does not preclude its classification under HTSUS heading 8419.” Applied Biosystems v. United States, 34 C.I.T. 769, 777 (Ct. Int'l Trade 2010).
By contrast, where the control of temperature is not essential to the function of laboratory equipment, the CIT has held that such machines fall outside the scope of heading 8419, HTSUS. For example, in Applikon Biotechnology, Inc. v. United States, 807 F. Supp. 2d 1323 (Ct. Int'l Trade 2011), the CIT found that the regulation of temperature was not essential to a machine’s primary purpose of growing cells, concluding in alternative that the machine’s heating function was “subsidiary to the cell growth function […] in the same manner that the water heating circuit in a washing machine is subsidiary to its function of cleaning clothes.” Applikon Biotechnology, Inc. v. United States, 807 F. Supp. 2d 1323, 1331 (classifying under heading 8479, HTSUS, a machine designed to maintain, via a mixing function, an aseptic and homogenous environment in which to culture cells).
Upon consideration of CBP’s prior analysis in HQ 965366 and the CIT’s guidance concerning the scope of heading 8419, HTSUS, CBP finds that the instant parallel reaction stations feature a non-subsidiary temperature control function that is essential to the overall function of the machines. Specifically, the ability of the machines to precisely and evenly heat or cool chemical compounds is necessary to provoke chemical reactions within the machines’ reaction tubes. Without the ability to apply a temperature gradient to the reaction tubes, the machine would not function. Moreover, the facts do not indicate that the stirring or shaking functions of the machines are essential to the parallel reaction stations’ primary purpose of synthesizing organic chemical compounds.
Based on the above facts, CBP finds that the parallel reaction stations are fully described by the text of heading 8419, HTSUS, because the heating and cooling functions of the machines are designed to catalyze chemical reactions within the devices’ reaction tubes. Similarly, the machines satisfy the requirements of Note 2(e) to Chapter 84, because the temperature functions are necessary to facilitate the overall function of the machines and are not subsidiary to the stirring or shaking capabilities of the devices. CBP therefore concludes that the parallel reaction stations are classifiable under heading 8419, HTSUS, specifically in subheading 8419.89.95, as laboratory equipment, whether or not electrically heated, for the treatment of materials by a process involving a change of temperature.
In closing, CBP notes that the Harmonized System Committee (HSC) of the World Customs Organization (WCO) has also examined the tariff classification of a machine similar to the instant parallel reaction stations and concluded that the machine—a “dissolution testing unit” equipped with an electrical coil for the heating and testing of pharmaceutical drugs—was properly classified under subheading 8419.89, HS. See Annex G/2 to Doc. NC1760E1b (HSC/49/March 2012). As stated in T.D. 89-90, CBP accords HSC opinions the same weight as that of Explanatory Notes, i.e., while neither legally dispositive or binding, classification decisions of the HSC are generally indicative of the proper interpretation of HS headings. Accordingly, CBP observes that the conclusions reached in this ruling are consistent with the HSC’s classification of the “dissolution testing unit,” as reflected in the WCO Compendium of Classification Opinions (C.O.) at C.O. 8419.89/3.
HOLDING:
By application of GRI 1, the parallel reaction stations are classified under heading 8419, HTSUS. Specifically, they are classifiable in subheading 8419.89.95, HTSUS, which provides for, “Machinery, plant or laboratory equipment, whether or not electrically heated (excluding furnaces, ovens and other equipment of heading 8514), for the treatment of materials by a process involving a change of temperature such as heating, cooking, roasting, distilling, rectifying, sterilizing, pasteurizing, steaming, drying, evaporating, vaporizing, condensing or cooling, other than machinery or plant of a kind used for domestic purposes; instantaneous or storage water heaters, nonelectric; parts thereof: Other machinery, plant or equipment: Other: Other.” The 2017 column one, general rate of duty for subheading 8419.89.95, HTSUS, is 4.2% ad valorem.
EFFECT ON OTHER RULINGS:
In accordance with the analysis set forth above, ruling letter NY I81272, dated May 21, 2002, is hereby REVOKED.
In accordance with 19 U.S.C. § 1625(c), this ruling will become effective 60 days after publication in the Customs Bulletin.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division