CLA-2 OT:RR:CTF:TCM H246717 ALS
Port Director
U.S. Customs and Border Protection
10426 Alta Drive
Jacksonville, Florida 32226
ATTN.: Ann Boone-Anderson, Entry Specialist
RE: Application for Further Review Protest No. 1803-13-100031; Tariff classification of a Motor Vehicle Tire
Dear Port Director:
This letter is in reply to an Application for Further Review (“AFR”) of Protest number 1803-13-100031, filed by legal counsel on July 16, 2013, on behalf of Dynamic Tire Corporation (“DTC” or “Protestant”). The Protest is against U.S. Customs and Border Protection’s (“CBP’s”) tariff classification of the above-referenced motor vehicle tire under subheadings 4011.20.1005/9903.40.05 of the Harmonized Tariff Schedule of the United States (“HTSUS”).
FACTS:
The subject article is a pneumatic rubber tire that is designed to be used with a motor vehicle. The Protestant describes it as a “Premium Trailer” tire, style S637. It is sold under the brand name “Sailun.” Marked on the side wall of the tire is the phrase “FOR TRAILER SERVICE ONLY” and the tire type designation of “LT.” LT is a Tire and Rim Association, Inc. (TRA) designation for “light truck.” The speed rating is “L”, which indicates a maximum speed capability of 75 miles per hour (mph), and the load rating is 126/123, which indicates a maximum load capacity of 3748 pounds. The size dimensions for the tire is 235/85R16, 14 ply--equivalent to the load range of “G.”
DTC submitted an affidavit from the Vice President of Operation and Logistics at Dynamic Tire Corporation in Canada. The affiant avers that he is personally familiar with Sailun tire model S637 product code 8244393 and that such tire was designed, marketed, and sold to be used exclusively as specialty trailer tires. Submitted along with the affidavit are copies of marketing literature of the Sailun tire model S637 that states, among other things, “Code S8244393” and “Applications: Trailers.”
DTC entered multiples of this tire on July 8 and 18, 2012 under the HTSUS subheading 4011.99.4500. Your office issued a Notice of Action to DTC on April 30, 2013, notifying it that CBP had rate advanced the two entries by virtue of changing the HTSUS classification to subheading 4011.20.1005.
ISSUE:
Is the subject motor vehicle tire, identified as style number S637, properly classified under subheading 4011.99 of the HTSUS as “New pneumatic tires, of rubber: Other”, or under subheading 4011.20 as “New pneumatic tires, of rubber: Of a kind used on buses or trucks”?
LAW AND ANALYSIS:
Initially, we note that the Protest was timely filed on July 16, 2013, which is within 180 days of the date of the liquidation of subject entries, May 24, 2013. See 19 U.S.C. §1514(c)(3). Additionally, CBP’s classification of the merchandise is a protestable matter under 19 U.S.C. §1514(a)(2). Further Review of Protest No. 1803-13-100031 is properly accorded to the Protestant pursuant to 19 CFR 174.24(b).
Classification under the HTSUS is determined in accordance with the General Rules of Interpretation (“GRI”) and, in the absence of special language or context which otherwise requires, by the Additional U.S. Rules of Interpretation (“ARI”). GRI 1 provides that the classification of goods shall be “determined according to the terms of the headings 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, GRIs 2 through 6 may be applied in order. GRI 6 provides that--
For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the [other GRIs], on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
ARI 1(a) provides that--
In the absence of special language or context which otherwise requires a tariff classification controlled by use (other than actual use) is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, and the controlling use is the principal use.
On September 11, 2009, the President issued a Presidential Proclamation entitled “Market Disruption from Imports of Certain Passenger Vehicle and Light Truck Tires.” See 74 Fed. Reg. 47861 (September 17, 2009). The Proclamation determined that, pursuant to 19 U.S.C. §2451(a), “import relief with respect to new pneumatic tires, of rubber, from China, of a kind used on motor cars (except racing cars) and on-the-highway light trucks, vans, and sport utility vehicles, provided in... subheadings 4011.20.10 and 4011.20.50 of the [HTSUS]... [and] such import relief... imposed for a period of 3 years... in the third year, the additional duty shall be in the amount of 25 percent ad valorem above the column 1 general rate of duty.”
The following 2012 headings and subheadings of the HTSUS are under consideration in this case:
4011 New pneumatic tires, of rubber:
4011.20 Of a kind used on buses or trucks:
4011.20.10 Radial. . .
* * *
4011.99 Other:
4011.99.45 Radial. . . .
* * *
New pneumatic tires, of rubber, the foregoing the product
China, under the terms of U.S. note 14 to this subchapter:
9903.40.05 Radial tires of a kind used on motor cars (other than racing cars), station wagons, sport utility vehicles, vans and on-the-highway light trucks (provided for in subheading 4011.10.10 or 4011.20.10) . . .
* * * * * * * * * * * * *
The Protestant contends that because the side walls of the subject tire is marked with the statement “FOR TRAILER SERVICE ONLY” and published marketing information indicates the tires are marketed as being for trailer use, the subject tires are not covered by the scope of subheading 4011.20, and therefore the Proclamation and related HTSUS subheading 9903.40.05 are not applicable in this case.
In determining if the subject tires are “of a kind used on buses and trucks,” we consider factors established by the Court of Customs and Patent Appeals. Those factors, referred to as “Carborundum factors,” include the general physical characteristics of the article, the expectation of the ultimate purchaser, the channels of trade, the environment of sale, the manner in which the article is advertised and displayed, and the usage of the merchandise. United States v. Carborundum Company, 63 CCPA 98, 536 F.2d 373, cert. denied 429 U.S. 979 (1976); see also CBP Ruling HQ 220856 (January 30, 2013).
The subject tire has dimensions of 235/85R16. As such, it is an “85 series” tire according to the Tire and Rim Association (TRA) Yearbook. LT235/85R16 is listed in the 85 series listings under the section for Light Trucks and ST235/85*16 is listed under the section for Industrial/ATV/Special Trailer tires. The * is a generic designation for “R”-Radial Ply or “D”-Diagonal or Bias Ply and ST is the designation for “special tires for trailers in highway service.” This suggests that tires of these dimensions are typically designed for either light trucks or trailers. The maximum speed of the subject tire is 75 mph, indicative of being suitable for both trailer and light truck use, according to the speed range charts in the TRA Yearbook for each relevant section. Neither the Light Truck section nor the Industrial/ATV/Special Trailer section list a 235/85R16 tire with the load range of G, equivalent to a ply rating of 14. According to the TRA, the larger the ply number/load range, the stronger the load carrying capacity of the tire. In this case, that indicates suitability for trailers more so than light trucks.
The pictures provided indicate that the tire has a standard tread suitable for on-road use, and are marked on the sidewall with the phrase “trailer service only” and “LT” (light truck). As noted above, the “R” initial in the 235/85R16 for the tire stands for “radial.” As we noted in an earlier CBP ruling, light truck tires are almost exclusively radial tires because radial tires have a lower rolling resistance and thus better high speed performance for on-road use. CBP Ruling HQ H242098 (April 23, 2015). Though the subject tire is marked with contradictory markings “FOR TRAILER SERVICE ONLY” and “LT,” TRA has stated that such markings are optional. We have previously recognized such markings as indicative of intended use; in this case, the presence of both marking would indicate suitability for both uses but for the limiting “ONLY” language. An internet search of “235/85R16” results in web pages of several tire retailers listing both light truck and trailer tires under 235/85R16.
Given the foregoing, and based on the Carborundum factors, GRI 6, and ARI 1(a), we conclude that the Sailun S637 235/85R16 tire cannot be said to be principally for use on light trucks or principally suitable for use on trailers. The characteristics of the subject tire do not clearly indicate that it is designed for predominant usage on either type of vehicle. This is supported by the affidavit stating that the subject tire was designed, marketed, and sold to be used exclusively as specialty trailer tires. Thus, the proper tariff classification for the tire at the time of its entry in this case was HTSUS subheading 4011.99 of the HTSUS as “New pneumatic tires, of rubber: Other.” More specifically, the subject tire is properly classified under subheading 4011.99.45, HTSUS, as “New pneumatic tires, of rubber: Other: Radial.” Therefore, subheading 9903.40.05, HTSUS, is not applicable in this case.
HOLDING:
By application of GRI 1, ARI 1(a), and GRI 6, HTSUS, the Sailun S637 235/85R16 tire is properly classified under subheading 4011.99 of the HTSUS as “New pneumatic tires, of rubber: Other.” Specifically, the subject tire is properly classified under subheading 4011.99.45, HTSUS, as “New pneumatic tires, of rubber: Other: Radial.” The general column one rate of duty, for merchandise classified in this subheading is 4%.
Duty rates are provided for your convenience and subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at www.usitc.gov.
The Protest should be GRANTED in accordance with the LAW AND ANALYSIS section above. A copy of this ruling should be attached to the CBP Form 19 or equivalent document and provided to the protestant as part of the notice of action on the protest.
Sixty days from the date of the decision the Office of International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division