OT:RR:CTF:EMAIN H329911 MFT
Mr. Peter A. Quinter
Gunster, Yoakley & Stewart, P.A.
600 Brickell Ave
Miami, FL 33131
Re: Prospective Ruling Request; Classification of Meal and Product Delivery Robots
Dear Mr. Quinter:
This letter is in response to your request, dated October 6, 2022, filed on behalf of your client Kiwi Campus, Inc. (Kiwibot) for a binding ruling pursuant to 19 CFR § 177. Your request concerns the classification under the Harmonized Tariff Schedule of the United States (HTSUS) of certain meal and product delivery robots, the robots’ eligibility for preferential tariff treatment under the U.S.-Colombia Trade Promotion Agreement (CTPA), and the customs valuation of the robots. Initially, this ruling addressed only the classification of the subject merchandise. We note that there is insufficient information in your ruling request to assess the robots’ eligibility for preferential treatment under the CTPA or to ascertain the subject merchandise’s valuation. As such, if you still would like a ruling on these two matters, please resubmit your ruling request with the information required in 19 CFR § 177.
FACTS:
The subject merchandise consists of meal and product delivery robots from Colombia known as “Kiwibots.” You state that the robots are “aimed at universities, cities, and companies in general,” and that they “circulate safely along the sidewalks to deliver meals and products through customers using an API (Application Programming Interface).” This API allows customers and users to connect to the robot and track their orders “at all times.” The robots use artificial intelligence, machine learning, and deep learning, and can “partially modify their speed autonomously on sidewalks based on the proximity of people.” To communicate with their surroundings, the robots have digitally animated eyes and can play sounds.
You further state that the robots have an inner plastic container for placing meals and products. Each robot incorporates electric hub motors to self-propel. The robots contain five distance sensors for avoiding obstacles, as well as a set of four cameras, a “Real Sense” camera, a GPS, and antennas. Finally, you note that “[o]ccasionally, a Kiwibot must operate on a public road, and in those circumstances, Kiwibot [i.e., Kiwi Campus, Inc.] obtains an operating permit from the appropriate State authority.”
You request that U.S. Customs and Border Protection (CBP) classify the subject robots under heading 8709, HTSUS, which provides for “Works trucks, self-propelled, not fitted with lifting or handling equipment, of the type used in factories, warehouses, dock areas or airports for short distance transport of goods; tractors of the type used on railway station platforms; parts of the foregoing vehicles.”
ISSUES:
Whether the subject robots are classified under heading 8704, HTSUS, which provides for “Motor vehicles for the transport of goods,” or under heading 8709, HTSUS, as “works trucks.”
LAW AND ANALYSIS:
Classification under the HTSUS is in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods will 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 will then be applied in order. In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes (ENs) may be utilized. The ENs, though not dispositive or legally binding, provide commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level.
The HTSUS headings under consideration are as follows:
8704 Motor vehicles for the transport of goods
* * * * *
8709 Works trucks, self-propelled, not fitted with lifting or handling equipment, of the type used in factories, warehouses, dock areas or airports for short distance transport of goods; tractors of the type used on railway station platforms; parts of the foregoing vehicles:
The ENs to heading 8709 of the Harmonized System provide, in pertinent part:
The main features common to vehicles of this heading which generally distinguish them from the vehicles of heading 87.01, 87.03 or 87.04 may be summari[z]ed as follows:
Their construction and, as a rule, their special design features, make them unsuitable for the transport of passengers or for the transport of goods by road or other public ways.
Their top speed when laden is generally not more than 30 or 35 km/h.
Their turning radius is approximately equal to the length of the vehicle itself.
Vehicles of this heading do not usually have a closed driving cab, the accommodation for the driver often being no more than a platform on which he stands to steer the vehicle. Certain types may be equipped with a protective frame, metal screen, etc., over the driver’s seat.
The vehicles of this heading may be pedestrian controlled.
Works trucks are self propelled trucks for the transport of goods which are fitted with, for example, a platform or container on which the goods are loaded.
We find that the subject robots squarely meet the terms of heading 8704, HTSUS, as motor vehicles for the transport of goods. First, the robots are “motor vehicles” in that each robot incorporates electric hub motors to self-propel (i.e., the robots are motorized) and can carry goods (i.e., the robots are vehicles) by road (even if only “occasionally”). Second, the robots are designed to transport goods in a plastic container for delivery to customers. The robots are thus prima facia classifiable under heading 8704, HTSUS, as motor vehicles for the transport of goods.
You argue that the subject robots are classifiable under heading 8709, HTSUS, “based on the vehicle’s characteristics as an electric cargo vehicle for short-distance travel at low speed, and on the fact that they do not require a driver to operate.” GRI 1 requires that the subject robots meet the terms of heading 8709, HTSUS, to be classifiable therein. Therefore, the subject robots must constitute “works trucks” to be properly classified under that heading.
The HTSUS does not define the terms “works” or “trucks.” The ENs to heading 8709 suggest that “works trucks” are “self-propelled trucks for the transport of goods which are fitted with, for example, a platform or container on which the goods are loaded.”
The Oxford English Dictionary defines a “truck” as follows:
3. A wheeled vehicle for carrying heavy weights; variously applied. [. . .]
g. A motor vehicle for carrying goods, troops, etc. by road. Cf. lorry n. 1b originally U.S.
This office previously defined “works” as “a place where industrial labor is carried on: Plant, Factory.” That definition is also consistent with that found in the Oxford English Dictionary:
21. Chiefly British. An establishment or premises in which industrial or manufacturing processes are carried out; esp. a factory. In later use only in plural (often with singular agreement).
Most importantly, both definitions are concordant with the legal text. The “factories” and “warehouses” mentioned in heading 8709, HTSUS, are in fact “place[s] where industrial labor is carried on” and “establishment[s] or premises in which industrial or manufacturing processes are carried out.” Even if one argues that “dock areas” and “airports” are not obviously industrial or manufacturing areas, their explicit mention opens heading 8709, HTSUS, to “works trucks” for use in such environs (provided that, in accordance with the terms, such vehicles are also self-propelled, not fitted with lifting or handling equipment, and are for the short distance transport of goods). Taking these definitions, the ENs, and the legal text together, “works trucks” may include “wheeled vehicles for carrying heavy weights” of the type used in “place[s] where industrial labor is carried on” and “establishment[s] or premises in which industrial or manufacturing processes are carried out.” Heading 8709, HTSUS, further specifies that such vehicles be “self-propelled, not fitted with lifting or handling equipment, [and] of the type used in factories, warehouses, dock areas or airports for [the] short distance transport of goods.” Finally, the ENs suggest that such vehicles may also be “fitted with, for example, a platform or container on which the goods are loaded.”
Based on this meaning, we find that the subject robots do not constitute “works trucks” under the common and commercial meaning of the term for three reasons. First, the robots are not “trucks.” They are certainly “wheeled vehicles,” but it is unclear that the “meals and products” they carry and deliver constitute the “heavy weights” contemplated by the definition of the term “truck.” Second, even accepting, arguendo, that the “meals and products” constitute “heavy weights” (hence making these robots “trucks”), the subject robots would not be considered “works” trucks. Heading 8709, HTSUS, explicitly requires that purported “works trucks” be “of the type used in factories, warehouses, dock areas or airports,” but as you state, the subject robots are “aimed at universities, cities, and companies in general.” To deem “universities, cities, and companies in general” as specifically “place[s] where industrial labor is carried on” and “establishment[s] or premises in which industrial or manufacturing processes are carried out” – to say nothing of “factories, warehouses, dock areas or airports” – would be to strain the meaning of “works” under the heading. Third, although this analysis does not rest on the ENs’ guidance, it is significant that the subject robots are capable of being used on public roads – albeit only “occasionally” – whereas “works trucks” of heading 8709, HTSUS, are generally incapable of doing so due to “[t]heir construction and, as a rule, their special design features.” The ENs suggest, then, that based on the robots’ ability to operate on public roads, even at low speeds, heading 8704, HTSUS, is more appropriate than heading 8709, HTSUS. The most that can be said supporting classification under heading 8709, HTSUS, is that the subject robots are "self-propelled," "not fitted with lifting or handling equipment," and are "for [the] short distance transport of goods," falling short of meeting all the heading’s terms.
Given these limitations, we find that the subject robots are properly classified under heading 8704, HTSUS, as “motor vehicles for the transport of goods.”
HOLDING:
By application of GRI 1, we hold that the subject meal and delivery robots are properly classified under heading 8704, HTSUS, specifically under subheading 8704.60.00, HTSUS, which provides for “Motor vehicles for the transport of goods: Other, with only electric motor for propulsion.” The general, column one rate of duty is 25% ad valorem.
Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP website at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Yuliya A. Gulis, Director
Commercial and Trade Facilitation Division