CLA-2: OT: RR: CTF: TCM H251034 ERB
Port Director, Port of Memphis
U.S. Customs and Border Protection
3150 Tchulahoma Road, Suite 1
Memphis, TN 38118
Attn: La Don Tucker, Import Specialist
RE: Application for Further Review of Protest Number 2006-13-102409; Tariff classification of motor spindles
Dear Port Director:
The following is our decision regarding the Application for Further Review (AFR) of Protest Number 2006-13-102409, timely filed on November 19, 2013, by counsel on behalf of DMG Mori Seiki USA, Inc. (DMG). The AFR concerns the classification of motor spindles designed for use in milling machine tools under the Harmonized Tariff Schedule of the United States (HTSUS). Our decision takes into consideration additional information provided to this office by DMG via email dated, August 31, 2015, as well as follow up information emailed to this office on September 10, 2015.
The instant AFR regards 13 entries of the subject merchandise. The 13 subject entries are not identical to one another, and many contain goods that are not the subject of this AFR. This AFR regards only the goods described as spindles or motor spindles.
CBP liquidated the subject spindles as entered, on May 24, 2013, classified under subheading 8466.93.95, HTSUS, which provides for, “Parts and accessories suitable for use solely or principally with the machines of heading 8456 to 8465, including work or tool holders, self-opening dieheads, dividing heads and other special attachments for machine tools; tool holders for any type of tool for working in the hand: Other: For machines of headings 8456 to 8461: Other: Other.”
DMG argues here that the goods are properly classified under subheadings 8501.52.40, HTSUS and 8501.52.80, HTSUS, which provides for electric motors, depending on the underlying spindle’s specific output level, which distinguishes these products at the 8-digit level.
A spindle is the rotating axis of a machine. This is sometimes referred to as a spindle shaft. A rotor is a moving component in an electromagnetic system of an electric motor. The stator is the stationary part of a rotary system. The stator provides the power source which causes the rotor to rotate, which turns the spindle shaft. The spindle shaft transmits this rotary motion from the stator to the tool or work holder. The instant merchandise, however, combines the spindle and the motor into one unit. Combining the spindle and motor in this way allows the machine to move faster, enhances accuracy, torque and reliability, insofar as it reduces the number of moving objects within the device. The more objects that move, the more vibration occurs, which compromises accuracy. A motorized spindle or motor spindle is routinely used in manufacturing that requires a high level of precision and speed, such as milling, drilling, turning and boring, grinding as well as robotic functions. When installed, the subject motor spindle turns a cutting tool which removes material from a work piece holder. However the relevant cutting tool head is not imported with the subject motor spindles. The merchandise is completely assembled in its condition as imported. Its output is measured in terms of kilowatts (kW).
Whether the subject motorized spindle, in its condition assembled, are classified upon importation as parts and accessories suitable for use solely or principally with the machines of heading 8456 to 8465, including work or tool holders, in heading 8466, HTSUS, or whether they are classified as electric motors of heading 8501, HTSUS.
LAW AND ANALYSIS:
Initially, we note that this matter is protestable under 19 U.S.C. § 1514(a) (2) as a decision on classification. The protest was timely filed, within 180 days of liquidation. See Miscellaneous Trade and Technical Corrections Act of 2004, Pub. L. 108-429, § 2103(2) (B) (ii), (iii)(codified as amended at 19 U.S.C. § 1514(c)(3)(2006)).
Further Review of Protest Number 2006-13-102409 is properly accorded to DMG pursuant to 19 C.F.R. § 174.24(b) because DMG alleges that its submission involves questions of law or fact which have not been ruled upon by the Commissioner of Customs or his designee or by the Customs Courts. Specifically, whether the subject rotor and stator, imported assembled with a spindle, are considered electric motors of heading 8501, HTSUS.
Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRI). GRI 1 provides that the classification of goods shall 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 may then be applied.
The HTSUS headings under consideration are the following:
8466 Parts and accessories suitable for use solely or principally with the machines of headings 8456 to 8464, including work or tool holders, self-opening dieheads, dividing heads and other special attachments for machine tools; tool holders for any type of tool for working in the hand:
8466.93 For machines of headings 8456 to 8461:
8501 Electric motors and generators (excluding generating sets):
Other AC motors, multi-phase:
8501.52 Of an output exceeding 750 W but not exceeding 75 kW:
8501.52.40 Exceeding 750 W but not exceeding 14.92 kW:
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 HS and are thus useful in ascertaining the proper classification of the merchandise. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 12, 1989).
The EN 85.01 states the following, in relevant part:
Electric motors are machines for transforming electrical energy into mechanical power. This group includes rotary motors and linear motors.
Rotary Motors produce mechanical power in the form of a rotary motion. They are of many types and sizes according to whether they operate on DC or AC, and according to the use or purpose for which they are designed. The motor housing may be adapted to the circumstances in which the motor will operate (e.g. dust proof, drip proof or flame proof motors; non-rigid mountings for belt driven motors, or for motors which will be subject to much vibration.)
Motors remain classified here even when they are equipped with pulleys, with gears or gear boxes, or with a flexible shaft for operating hand tools.
The heading includes “outboard motors”, for the propulsion of boats, in the form of a unit comprising an electric motor, shaft, propeller and a rudder.
Customs has consistently classified motors imported with certain additional components under heading 8501, HTSUS, as electric motors. In Headquarters Ruling Letter (HQ) H044560, dated September 18, 2009, CBP stated, “The question of whether an electric motor consisting of additional components remains classifiable as a motor under heading 8501, HTSUS, is well settled.” Id. In HQ 086832, dated May 21, 1990, Customs also stated, “a motor remains a motor for tariff purposes despite having other articles attached to it,” and further, “[t]hese other articles can be quite substantial.” See also PD A83602, dated June 1, 1996. Likewise, in HQ 955037, dated February 14, 1994, concerning the classification of electric actuators/motors, Customs explained that an electric motor is classifiable under heading 8501, HTSUS, even when imported with additional components (other than those listed in Explanatory Notes 85.01) if:
Those additional components complement the function of a motor. See HQ 083955, dated July 10, 1989 (classifying electric sewing machine motors in heading 8501, HTSUS)
Those additional components are devices which motors are commonly equipped. See HQ 087909, dated December 26, 1990, (classifying DC motor assemblies in heading 8501, HTSUS)
Those additional component serve merely to transmit the power the motors product. See HQ 950557, dated December 26, 1991 (classifying windshield wiper motors in heading 8501, HTSUS)
The instant merchandise consist of a rotor and a stator, albeit a motorized stator combined with the spindle. This motor spindle rotates the shaft as a single unit. It is imported in a fully assembled condition, ready to be installed into a milling machine requiring a replacement. Ordinarily, a spindle is an additional component which complements the function of a motor, and which is often imported with a motor, as was noted in HQ 083955, above. That the spindle and the motor are combined here does not change the circumstances that it is a complementary component. Also, it does not enhance the subject motor beyond the scope of heading 8501, HTSUS. For example, in HQ 086832, supra, CBP classified a motor used with automatic data processing machines (ADP), whereby a spindle motor served as the platform for mounting memory discs which stored data in hard drives. We noted in that ruling that although those spindle motors are designed for use with ADPs, they are specifically provided for in heading 8501, HTSUS, as electric motors.
Similarly, in Nidec Corporation v. United States, 861 F. Supp. 136, (Ct. Int’l Trade 1994), aff'd. 68 F. 3d 1333 (Fed. Cir. 1995), the Court of International Trade (CIT) classified an actuator electric motor used in an ADP as an electric motor, denying arguments that the presence of additional components made the goods something more than an electric motor. There the Court found that "the essence of the goods was still that of a motor, not of a spindle," thus precluding classification as something more than an electric motor. Nidec at 143.
This position was reinforced in Belimo Automation A.G. v. United States, 774 F. 3d 1362 (Fed. Cir. 2014), where the Federal Circuit affirmed the CIT’s underlying decision where the CIT stated, “[h]eading 8501 is an eo nomine provision, meaning that it includes “all forms” of ‘electric motors’, even those equipped with additional components, absent limiting language or contrary legislative intent.” Belimo Automation A.G. v. United States, 35 Int’l Trade Rep. (BNA) 2319, Slip Op 13-144 * 14 (Ct. Int’l Trade Nov. 26, 2014). The CIT noted that certainly, the additional components contributed to expanded functionalities beyond those of a basic electric motor. “However, these functions are complementary to the functions of the electric motor such that even with the [additional components] the subject imports serve the same principal function;” that of an electric motor. Id at *27.
This analysis is directly applicable to the instant merchandise, which contains a motorized spindle that turns a cutting tool (not included) to remove material from a work piece holder. That the combined motorized spindle enhances the functionalities of the subject merchandise, because minimizing the number of moving parts allows this device to move faster, with more precision, with less vibration, as compared to a separate rotor, stator, spindle and shaft, does not remove the motor spindle from classification as an electric motor of heading 8501, HTSUS.
Counsel suggests in its submission that New York Ruling Letter (NY) N130195, dated November 23, 2010, should be considered for revocation. However, the merchandise which was the subject of that ruling incorporated a motor magnet, as well as a chiller. These extra features distinguish this good from the instant motor spindles, which do not have a motor magnet or chiller, and further, transformed that object beyond the scope of electric motors of heading 8501, HTSUS.
DMG stated in a supplemental submission to this office dated September 10, 2015, that all of the motor spindles covered under this AFR are alternating current (AC) motors, and none are direct current (DC) motors. Electric motors which are AC motors are provided for in subheading 8501.52, HTSUS. At the 8-digit subheading level, products classified herein are done so depending on the underlying motor’s specific kilowatt output level. Therefore, the subject motor spindles are classified in this manner, pursuant to the motor output level, which is specified in the product’s invoices.
Under the authority of GRI 1, the subject motor spindles are provided for in heading 8501, HTSUS. Specifically, the subject merchandise which is marked as exceeding 750 W but not exceeding 14.92 kW are provided for in subheading 8501.52.4000, HTSUSA (Annotated), which provides for, “Electric motors and generators (excluding generating sets): Other AC motors, multiphase: Of an output exceeding 750 W but not exceeding 75 kW: Exceeding 750 W but not exceeding 14.92 kW.” The column one rate of duty is 3.7% ad valorem.
The subject merchandise which does not satisfy the output noted above is classified in subheading 8501.52.8040, HTSUSA, which provides for, “Electric motors and generators (excluding generating sets): Other AC motors, multi-phase: Of an output exceeding 750 W but not exceeding 75 kW: Other: Other.” The column one rate of duty here is free.
The protest should be GRANTED.
You are to mail this decision, together with the CBP Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision Regulations and Rulings of the Office of International Trade will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Myles B. Harmon, Director
Commercial and Trade Facilitation Division