CLA-2 OT:RR:CTF:EMAIN H312778 NVF
Ms. Sue Comello
Peerless Gear
1555 S. Jackson Street
Salem, IN 47167
RE: Tariff classification of certain transmission cases and covers; Applicability of subheading 9817.00.60, HTSUS
Dear Ms. Comello:
This is in response to your request, dated July 9, 2020, for a binding ruling on the classification under the Harmonized Tariff Schedule of the United States (HTSUS) of two transmission cases and two transmission covers. You also request us to address the possible applicability of subheading 9817.00.60, HTSUS, to the same merchandise.
FACTS:
The items under consideration are identified as a transmission case (Part Number 7610P1) and its matching transmission cover (Part Number 7611P1), and a transmission case (Part Number 4210P2) along with its matching transmission cover (Part Number 5152P3). All four items are made of die cast aluminum. You state that during assembly, each transmission case is paired with a matching transmission cover to form the housing of the gear train.
In your request, you identify the transmission cases and covers as parts of riding lawn mowers. You indicate that the cases and covers are assembled into a transmission before being sold to a lawn mower manufacturer. However, the materials submitted with your request contain photographs of a Ventrac brand model 4500 compact tractor with lawn mower attachment and a Steiner brand model 450DX compact tractor with various attachments.
ISSUES:
What is the proper classification of the instant transmission cases and covers? Whether the transmission cases and covers are eligible for duty-free treatment under subheading 9817.00.60, HTSUS.
LAW AND ANALYSIS:
Classification of Transmission Cases and Covers
Classification of goods under the HTSUS is governed by the General Rules of Interpretation (GRI). GRI 1 provides that classification shall be determined according to the terms of the headings of the tariff schedule and any relative section or chapter notes.
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 HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
The HTSUS headings under consideration are as follows:
8433 Harvesting or threshing machinery, including straw or fodder balers; grass or hay mowers; machines for cleaning, sorting or grading eggs, fruit or other agricultural produce, other than machinery of heading 8437; parts thereof.
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8483 Transmission shafts (including cam shafts and crank shafts) and cranks; bearing housing 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.
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8708 Parts and accessories of the motor vehicles of headings 8701 to 8705.
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 HTSUS and are generally indicative of the proper interpretation of these headings. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).
Note 1(l) to Section XVI, which encompasses heading 8483, states that Section XVI does not cover articles of Section XVII, which encompasses heading 8708. Note 2(e) to Section XVII states, in pertinent part, that “Machines or apparatus of headings 8401 to 8479, or parts thereof…; or… provided they constitute integral parts of engines or motors, articles of heading 8483” are not covered by any parts or accessory provision in Section XVII.
The term “part” is not defined in the HTSUS. In the absence of a statutory definition, the courts have fashioned two distinct but reconcilable tests for determining whether a particular item qualifies as a part for tariff classification purposes. See Bauerhin Technologies Limited Partnership, & John V. Carr & Son, Inc. v. United States, 110 F.3d 774 (Fed. Cir. 1997). Under the first test, articulated in United States v. Willoughby Camera Stores, 21 C.C.P.A. 322 (1933), an imported item qualifies as a part only if can be described as an “integral, constituent, or component part, without which the article to which it is to be joined, could not function as such article.” Bauerhin, 110 F.3d at 779. Pursuant to the second test, set forth in United States v. Pompeo, 43 C.C.P.A. 9 (1955), a good is a “part” if it is “dedicated solely for use” with a particular article and, “when applied to that use…meets the Willoughby test.” Bauerhin, 110 F.3d at 779 (citing Pompeo, 43 C.C.P.A. at 14); Ludvig Svensson, Inc. v. United States, 63 F. Supp. 2d 1171, 1178 (Ct. Int'l Trade 1999) (holding that a purported part must satisfy both the Willoughby and Pompeo tests). An item is not a part if it is “a separate and distinct commercial entity.” Bauerhin, 110 F.3d at.779.
The information submitted in your request indicates that the subject transmission cases and covers are designed to house the gear train of a transmission and also hold bearings which support internal shafts. A transmission is a device that is connected to the back of an engine and sends the power from the engine to the drive wheels. It is not part of an engine or motor. Rather, it ensures that power is delivered to the wheels while keeping the engine operating at optimal speed, i.e., revolutions per minute, using various gear combinations. A transmission is made up of the following components: planetary gear sets, shafts, bearings, seals and gaskets, governor and modulator, synchronizer, and housing. HQ W563509 (Aug. 30, 2006). Illustrations that you submitted identify the transmission cases and covers as part of the front and rear transaxle. Specifically, the cases and covers house the gears within the transmission portion of the transaxle and contain integrated bearings to support the shafts. Therefore, leaving aside the issue of whether they are articles of heading 8483, HTSUS, the subject cases and covers are not an integral part of an engine or a motor.
We must next determine what machine the subject transmission cases and covers are designed for and the proper classification of that machine in order to ascertain whether they are excluded by Note 2(e) to Section XVII. In your request, you state that the transmission covers and cases are designed for riding lawn mowers. However, the materials submitted with your request contain photographs of a Ventrac brand model 4500 compact tractor with lawn mower attachment and a Steiner brand model 450DX compact tractor with various attachments.
A riding lawn mower is a lawn mower with a seat attached for the user to sit on when operating the machine. Its primary purpose is to cut grass. Riding lawn mowers are classified under heading 8433, HTSUS, which provides for grass or hay mowers. E.g. NY G87860 (Mar. 13, 2001) and NY G89472 (Apr. 25, 2001). All grass mowers are classified under heading 8433, HTSUS, regardless of whether the user rides or pushes them. Explanatory Note (“EN”) 84.33(21) clarifies that the heading “covers lawn mowers, known as riding lawn mowers, consisting of three or four wheeled basic machines fitted with a driving seat and having a permanently attached cutter, i.e., one which is removed only for repair or maintenance. Since their principal function is the mowing of lawns, they remain in this heading even if they have a coupling device for hauling or pushing light attachments such as a trailer.” Therefore, any machine with the principal function of mowing grass, as indicated by the presence of a permanently attached cutter, is considered a lawn mower of heading 8433, HTSUS.
By contrast, sub-compact and compact tractors are utility vehicles that have multiple uses and typically have multiple attachment points and attachments. Unlike riding lawn mowers or lawn tractors, sub-compact and compact tractors do not have permanently attached mowing blades and are multi-purpose machinery capable of handling a wider range of jobs. These tractors, regardless of size and attachment options, are classified under heading 8701, HTSUS, which provides for “Tractors (other than tractors of heading 87.09).”
In this case, your request includes two photographs of machines for which the subject merchandise is designed. The machines in the photographs are the Ventrac 4500 tractor and the Steiner 450DX. Our research indicates that both machines are compact tractors and do not have permanent lawn mowing blades. Rather, they both merely have lawn mowing attachments that can be removed or attached according to the user’s needs. Therefore, these machines are not riding lawn mowers of heading 8433; they are tractors of heading 8701, HTSUS. As such, Note 2(e) to Section XVII does not exclude the instant transmission covers and cases from classification under Section XVII.
As stated earlier, the subject transmission cases and covers, while not part of an engine or motor, make up part of a transaxle and specifically form the housing of the transmission portion of the transaxle. A transaxle is an integral part of the vehicle in which it functions; a vehicle cannot function without the transmission, differential, and axles that comprise a transaxle. In light of the above, we conclude that the instant transmission cases and covers are classified under heading 8708, HTSUS as a part of a motor vehicle of heading 8701, HTSUS.
Applicability of Subheading 9817.00.60, HTSUS
Subheading 9817.00.60, HTSUS provides duty-free treatment for:
Parts to be used in articles provided for in headings 8432, 8433, 8434 and 8436, whether or not such parts are principally used as parts of such articles and whether or not covered by a specific provision within the meaning of additional U.S. rule of interpretation 1(c).
Subheading 9817.00.60, HTSUS, is an actual use provision. To fall within this special classification, a three-part test must be met. First, the subject merchandise must not be excluded from the heading under Section XXII, Chapter 98, Subchapter XVII, U.S. Note 2, HTSUS. Secondly, the terms of the headings must be met in accordance with GRI 1, which provides that classification is determined according to the terms of the headings and any relative section or chapter notes. Thirdly, the article must comply with the actual use regulations under Section 10.131 through 10.139, Customs Regulations (19 CFR §10.131 through 10.139).
U.S. Note 2(w) to Section XXII, Chapter 98, Subchapter XVII states in pertinent part that “The provisions of headings 9817.00.50 and 9817.00.60 do not apply to articles provided for in chapter 87.”
We have established above that the subject transmission cases and covers are classified as parts of tractors under heading 8708, HTSUS, which falls under Chapter 87 of the HTSUS. Therefore, pursuant to U.S. Note 2(w) to Section XXII, Chapter 98, Subchapter XVII, the subject transmission cases and covers are not eligible for duty-free treatment under subheading 9817.00.60, HTSUS.
HOLDING:
By application of GRIs 1 and 6, the subject transmission cases and covers are classified under subheading 8708.40.60, HTSUS, which provides for: Parts and accessories of the motor vehicles of headings 8701 to 8705: Gear boxes and parts thereof: Parts: Of tractors suitable for agricultural use. The column one, general rate of duty is free.
Effective July 6, 2018, the Office of the United States Trade Representative (USTR) imposed an additional tariff on certain products of China classified in the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(b), HTSUS. The USTR imposed additional tariffs, effective August 23, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(d), HTSUS. Subsequently, the USTR imposed further tariffs, effective September 24, 2018, on products classified under the subheadings enumerated in Section XXII, Chapter 99, Subchapter III U.S. Note 20(f) and U.S. Note 20(g), HTSUS. For additional information, please see the relevant Federal Register notices dated June 20, 2018 (83 Fed. Reg. 28710), August 16, 2018 (83 Fed. Reg. 40823), and September 21, 2018 (83 Fed. Reg. 47974). Products of China that are provided for in subheading 9903.88.01, 9903.88.02, 9903.88.03, or 9903.88.04 and classified in one of the subheadings enumerated in U.S. Note 20(b), U.S. Note 20(d), U.S. Note 20(f) or U.S. Note 20(g) to subchapter III shall continue to be subject to antidumping, countervailing, or other duties, fees and charges that apply to such products, as well as to those imposed by the aforementioned Chapter 99 subheadings.
By application of U.S. Note 2(w) to Section XXII, Chapter 98, Subchapter XVII, the subject transmission cases and covers are not eligible for duty-free treatment under subheading 9817.00.60, HTSUS.
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/tata/hts/.
A copy of this ruling letter should be attached to the entry documents filed at the time the goods are entered. If the documents have been filed without a copy, this ruling should be brought to the attention of the CBP officer handling the transaction.
Sincerely,
Gregory Connor, Chief
Electronics, Machinery, Automotive, and
International Nomenclature Branch