CLA-2 OT:RR:CTF:TCM H276957 AP
Stephanie Quirk
HTS Classification Manager
Daimler Trucks North America LLC
4555 N Channel Avenue, HQ501-ITC
Portland, OR 97219
RE: Request for Reconsideration of HQ H255852; Tariff classification of a Turbo-Compound Gearbox
Dear Ms. Quirk:
This is in response to your letter of June 22, 2016, requesting reconsideration of Headquarters Ruling Letter (HQ) H255852, dated May 23, 2016, regarding the classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of a turbo-compound gearbox (TCG) used to boost the power of a diesel engine. In HQ H255852, U.S. Customs and Border Protection (CBP) classified the TCG in heading 8483, and more specifically in subheading 8483.40.70, which provides for “Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof: Gears and gearing, other than toothed wheels, chain sprockets and other transmission elements entered separately; ball or roller screws; gear boxes and other speed changers, including torque converters: Gear boxes and other speed changers: Other speed changers.” Our response follows.
FACTS:
The TCG is used with a turbocharger, an axial power turbine (APT), and an idler gear to form a turbo compound system to increase the output power of a diesel engine up to 50 horsepower. The turbocharger, APT, TCG, and idler gear are connected on the “hot” exhaust side of the engine. The ATP and TCG utilize the exhaust gas of the engine to boost its power by providing additional torque to the crankshaft. The APT incorporates a turbine blade and output pinion gear. The APT’s output pinion gear is connected to an input ring gear on the TCG. Input speed (rotation of the input ring gear) varies in accordance with the exhaust flow and pressure through the APT.
Within the TCG, the turning input gear ring powers a hydraulic coupling, which turns a single output gear. The output gear is the only internal gearing that the TCG contains at the time of importation. The hydraulic coupling is the sole internal component of the TCG responsible for transmitting power from the input gear ring to the output gear. Output speed (rotation of the output gear) varies in a fixed proportion to input speed. The gear ratio is not capable of manual manipulation. The hydraulic coupling provides a rotational buffer between the input gear and the output gear, and mitigates engine vibration by isolating the turbine from the engine crankshaft. The hydraulic coupling is transmitting rotating mechanical power and differs from a clutch in that it is not engaging or disengaging between shafts. The TCG’s output gear is connected to an external idler gear, which is connected to a crankshaft gear. The TCG has only one speed and does not contain assemblies of gears that can be selected in alternative arrangements.
In HQ H255852, dated May 23, 2016, CBP determined that the TCG is classified in subheading 8483.40.70, HTSUS. On June 22, 2016, you requested reconsideration of CBP’s finding in HQ H255852. You assert that the TCG is a fixed-ratio speed changer and is more specifically provided for in subheading 8483.40.5010, HTSUS, which covers “Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof: Gears and gearing, other than toothed wheels, chain sprockets and other transmission elements entered separately; ball or roller screws; gear boxes and other speed changers, including torque converters: Gear boxes and other speed changers: Fixed ratio speed changers, multiple and variable ratio speed changers each ratio of which is selected by manual manipulation: Other: Fixed ratio speed changers.”
You claim that the input speed varies in accordance with the exhaust flow and pressure through APT and that the output speed varies in a fixed proportion to input speed. You also claim that the amount of additional torque provided to the crankshaft is variable and directly dependent upon the rate of exhaust flow through the APT. You explain that the internal hydraulic coupling of the TCG has no ability to vary the ratio of input speed to output speed and that the hydraulic coupling is the sole internal component of the TCG responsible for transmitting power from the ring gear to the output gear. You rely on New York Ruling Letters (NY) J84453, dated May 29, 2003; NY J84449, dated June 2, 2003; NY J84450, dated June 2, 2003; NY H84819, dated Aug. 28, 2001; NY G87555, dated Mar. 22, 2001; NY N171997, dated July 18, 2011; and NY N173178, dated
July 22, 2011.
ISSUE:
Whether the TCG is classifiable as a manually manipulated fixed-ratio speed changer under subheading 8483.40.50 or as other speed changer under subheading 8483.40.70.
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 considered statutory provisions 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 order. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the heading and legal notes do not otherwise require, the remaining GRIs 2 through 6 may then be applied in order.
GRI 6 states, in pertinent part that:
[T]he 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 above rules, on the understanding that only subheadings at the same level are comparable. For the purpose of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires.
The HTSUS subheadings under consideration are as follows:
8483 Transmission shafts (including camshafts and crankshafts) and cranks; bearing housings, housed bearings and plain shaft bearings; gears and gearing; ball or roller screws; gear boxes and other speed changers, including torque converters; flywheels and pulleys, including pulley blocks; clutches and shaft couplings (including universal joints); parts thereof:
8483.40 Gears and gearing, other than toothed wheels, chain sprockets and other transmission elements entered separately; ball or roller screws; gear boxes and other speed changers, including torque converters:
. . .
Gear boxes and other speed changers:
Fixed ratio speed changers, multiple and variable ratio speed changers each ratio of which is selected by manual manipulation:
. . .
8483.40.50 Other [than imported for use with machines for making cellulosic pulp, paper or paperboard]
8483.40.5010 Fixed ratio speed changers
. . .
8483.40.7000 Other speed changers
At GRI 1, there is no dispute that the TCG is classified in heading 8483, HTSUS because this heading provides eo nomine for gearboxes and other speed changers. Rather, the issue is the proper classification at the subheading level. As a result, GRI 6 applies.
The TCG at issue is not prima facie classifiable under subheading 8483.40.50, HTSUS, because it is not a manually manipulated fixed-ratio transmission. See NY N173178, dated July 22, 2011 (manually manipulated fixed-ratio multi-speed transmissions for use in loading machines and tractors classifiable in subheading 8483.40.50, HTSUS); NY N171997, dated July 18, 2011 (manually manipulated two-speed fixed-ratio synchro shuttle design gearbox for use in a telescopic handler machine and four-speed fixed-ratio transmission for use in a backhoe loader classifiable in subheading 8483.40.50, HTSUS); NY G87555, dated Mar. 22, 2001 (lawn mower transmissions that appear to be manually manipulated classifiable in subheading 8483.40.50, HTSUS). The CBP rulings that you primarily rely upon are silent as to the operation of the involved gearboxes and lack precedential value. See NY J84453, dated May 29, 2003, NY J84449, dated June 2, 2003 & NY J84450, dated June 2, 2003 (fixed ratio inlet gearboxes); NY H84819, dated Aug. 28, 2001 (speed-increasing gearbox).
In the instant case, the TCG is classified under subheading 8483.40.70, HTSUS, as a speed changer other than a manually manipulated fixed-ratio speed changer or a multiple/variable ratio speed changer consistent with GRI 6 and the language of this subheading. The TCG is used solely with a diesel automobile engine and acts as a transmission to the turbo-compound system by transmitting power from the turbocharger to the crankshaft, which in turn provides additional power to the engine. The TCG requires only one speed for the operation of the system and output speed varies in a fixed proportion to input speed. Once the product is installed, the speed of transmission cannot be varied to an arrangement of gear sets. The gear ratio is not capable of manual manipulation. The TCG does not function as a clutch in that it is not engaging or disengaging between shafts.
Therefore, we affirm our finding in HQ H255852 that the TCG meets the terms of subheading 8483.40.70, HTSUS.
HOLDING:
By application of GRIs 1 and 6, the subject TCG is classified under heading 8483, HTSUS, and specifically provided for under subheading 8483.40.70, HTSUS. The column one, general rate of duty is 25¢ each + 3.9%. 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 www.usitc.gov.
EFFECT ON OTHER RULINGS:
HQ H255852, dated May 23, 2016, is hereby AFFIRMED.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division