OT:RR:CTF:EMAIN H329722 MFT
Center Director
Electronics Center of Excellence & Expertise
301 E. Ocean Blvd., Suite 1400
Long Beach, CA 90802
ATTN: John Raynes, Import Specialist
RE: Application for Further Review of Protest No. 5301-22-108091; Classification of Battery
Energy Storage System Containers
Dear Center Director:
This letter relates to the Application for Further Review (AFR) of Protest No. 5301-22-
108091, which was filed on June 6, 2022, on behalf of Ingeteam, Inc. (protestant), concerning
the classification and liquidation by U.S. Customs and Border Protection (CBP) of certain
battery energy storage system containers under the Harmonized Tariff Schedule of the United
States (HTSUS).
FACTS:
The items under consideration are battery energy storage system (BESS) containers from
China. The BESS containers consist of steel containers that are designed to hold batteries after
modifications that are made post-importation. Each container measures 13,716 mm in length;
2,438 mm in width; and 3,200 mm in height. The BESS containers have an internal cubic
capacity of 79.7 m3 and a maximum permissible payload of 38,760 pounds. The BESS
containers are not fitted with mechanical or thermal equipment but have runners as well as
several hinged doors along the side walls.
The BESS containers have lifting hooks and supports that the protestant claims “facilitate
the handling and securing on [a] transporting vehicle.” However, the protestant also submits that
because the BESS containers have “no front [or] rear end wall strength” and “no side wall
strength,” they are “special container[s]” and are “only intended for ‘special service’” in
transportation. “The container floor,” the protestant states, “is not designed to withstand
concentrated dynamic loading imposed during cargo operations involving powered industrial
trucks and similar devices.” The protestant further notes that “[t]he special design, including the
reduced strength of the front and rear end walls, the absence of any side wall strength given the
placement of hinged doors throughout and the addition of runners and hooks within the BESS
Containers, highlight[s] the limited functionality and use of these items.”
On November 17, 2021, the protestant entered the subject merchandise under heading
8609, HTSUS, which provides for “Containers (including containers for the transport of fluids)
specially designed and equipped for carriage by one or more modes of transport.” The general
column one rate of duty for goods classified under that provision is free.
On February 25, 2022, CBP liquidated the subject merchandise under heading 7309,
HTSUS, which provides for “Reservoirs, tanks, vats and similar containers for any material
(other than compressed or liquefied gas), of iron or steel, of a capacity exceeding 300 liters,
whether or not lined or heat insulated, but not fitted with mechanical or thermal equipment.”
CBP also liquidated the subject merchandise under subheading 9903.88.03, HTSUS, which
corresponds with the Section 301 remedy for certain products of China. 1
ISSUE:
Whether the subject BESS containers are properly classified under heading 7309,
HTSUS, which provides for “Reservoirs, tanks, vats and similar containers for any material
(other than compressed or liquefied gas), of iron or steel, of a capacity exceeding 300 liters,
whether or not lined or heat insulated, but not fitted with mechanical or thermal equipment,” or
under heading 8609, HTSUS, which provides for “Containers (including containers for the
transport of fluids) specially designed and equipped for carriage by one or more modes of
transport.”
LAW AND ANALYSIS:
We first note that the Protest was properly filed as a decision on classification under 19
U.S.C. § 1514(a)(2). This Protest was timely filed, within 180 days of liquidation of the first
entry. See 19 U.S.C. § 1514(c)(3). Further review of Protest No. 5301-22-108091 was properly
accorded to the protestant pursuant to 19 C.F.R. § 174.24(b) because the protestant alleges that
CBP’s liquidation of the subject merchandise involves questions of law or fact which have not
been ruled upon by the Commissioner of CBP or his designee or by the Customs courts.
Classification under the HTSUS is determined in accordance with the General Rules of
Interpretation (GRIs). 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 2 through 6 may then be
applied in order.
1
See U.S. Note 20(e) and U.S. Note 20(f) to Subchapter III to Chapter 99, HTSUS (Revision 2 of 2022 to the
HTSUS).
2
The HTSUS headings and subheadings under consideration are as follows:
7309 Reservoirs, tanks, vats and similar containers for any material (other than
compressed or liquefied gas), of iron or steel, of a capacity exceeding 300 liters,
whether or not lined or heat insulated, but not fitted with mechanical or thermal
equipment.
*****
8609 Containers (including containers for the transport of fluids) specially designed and
equipped for carriage by one or more modes of transport.
Note 1(g) to Section XV, HTSUS, states, in relevant part, that “…articles of Section
XVII…” are excluded from classification in Section XV, which covers heading 7309, HTSUS.
As such, the threshold matter in this protest is whether the subject BESS containers fall under the
scope of heading 8609, HTSUS, which falls under Section XVII.
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. 2
The ENs to heading 8609, HTSUS, provide in part:
These containers (including lift vans) are packing receptacles specially designed
and equipped for carriage by one or more modes of transport (e.g., road, rail,
water or air). They are equipped with fittings (hooks, rings, castors, supports, etc.)
to facilitate handling and securing on the transporting vehicle, aircraft or vessel.
They are thus suitable for the “door-to-door” transport of goods without
intermediate repacking and, being of robust construction, are intended to be used
repeatedly.
To be classifiable under heading 8609, HTSUS, GRI 1 requires that the BESS containers
be “specially designed and equipped for carriage by one or more modes of transport.” We find
that the BESS containers are not “specially designed and equipped for carriage by one or more
modes of transport” and thus cannot be classified under heading 8609, HTSUS. In fact, the
protestant’s own description of the merchandise illustrates that the BESS containers are not
covered by heading 8609, HTSUS. As the protestant states, these “special containers” do not
have any front end, rear end, or side wall strength, indicating that they lack the adequate support
to be “specially designed and equipped for carriage.” Furthermore, the fact that the floor of the
containers cannot “withstand concentrated dynamic loading imposed during cargo operations
involving powered industrial trucks and similar devices” provides additional evidence that the
containers are not designed for carriage. The BESS containers may have lifting hooks and
supports to aid in transporting the goods, but as the protestant argues, these items have “limited
functionality and use” given the weak wall strength.
2
See Treasury Decision (TD) 89-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).
3
Moreover, although not dispositive, the ENs to heading 8609, HTSUS, advise against
classification under that heading. The ENs posit that containers under heading 8609, HTSUS,
should be “suitable for the ‘door-to-door’ transport of goods without intermediate repacking and,
being of robust construction, are intended to be used repeatedly” (emphasis added). Though
made of steel, the BESS containers are not “of robust construction” seeing that they lack the
rigid front end, rear end, and side wall support necessary for carriage. Though they have “hooks”
and “supports” to “facilitate handling and securing on [a] transporting vehicle,” these items, as
the protestant points out, have “limited functionality and use”; hence, we decline to accord these
features considerable weight. We instead find that Note 1(g) to Section XV, HTSUS, does not
apply to exclude the subject merchandise from classification therein.
Turning to the question of whether the BESS containers fall under the scope of heading
7309, HTSUS, we note that CBP previously classified a steel battery housing container under
heading 7309, HTSUS, in New York Ruling Letter (NY) N317967. 3 The item at issue involved a
twenty-foot, high-cube shipping container, approximately 43,000 liters in volume, that was
modified and fitted with welded steel racks to store batteries in place. The container was
designed to function as a backup energy storage system when batteries and electrical equipment
were installed post-importation. That container did not function to accommodate regular human
access or convey cargo between locations. CBP found that because the container was “not
designed to transport goods, but rather to store batteries in a designated location,” the container
was not classifiable under heading 8609, HTSUS, but under heading 7309, HTSUS.
We echo the conclusion found in NY N317967 – that the subject BESS containers are
“not designed to transport goods, but rather to store batteries in a designated location,” and are
thus precluded from classification under heading 8609, HTSUS. The BESS containers squarely
meet the terms of heading 7309, HTSUS, as they are inherently “containers for any material
(other than compressed or liquefied gas),” specifically containers for batteries; they are made of
steel; their internal cubic capacity exceeds 300 liters; 4 and they are not fitted with mechanical or
thermal equipment. As a result, we hold that the subject BESS containers are classifiable under
heading 7309, HTSUS, as containers of steel.
HOLDING:
By application of GRIs 1 and 6, we hold that the subject BESS containers are properly
classified under heading 7309, HTSUS, specifically under subheading 7309.00.00, HTSUS,
which provides for “Reservoirs, tanks, vats and similar containers for any material (other than
compressed or liquefied gas), of iron or steel, of a capacity exceeding 300 liters, whether or not
lined or heat insulated, but not fitted with mechanical or thermal equipment.” The general
column one rate of duty is free.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China
classified under subheading 7309.00.00, HTSUS, unless specifically excluded, are subject to an
3
NY N317967 (Mar. 10, 2021).
4
The BESS containers have an internal cubic capacity of 79.7 m3, which converts to 79,700 liters. Seventy-nine
thousand seven hundred is greater than 300.
4
additional 25 percent ad valorem rate of duty imposed by the relevant Chapter 99 subheading,
i.e., 9903.88.03.
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 online at
http://www.usitc.gov/tata/hts/.
You are instructed to DENY this protest.
You are instructed to notify the protestant of this decision no later than 60 days from the
date of this decision. Any reliquidation of the entry or entries in accordance with the decision
must be accomplished prior to this notification. Sixty days from the date of the decision, the
Office of Trade, Regulations and Rulings will make the decision available to CBP personnel and
the public on the Customs Rulings Online Search System (CROSS) at https://rulings.cbp.gov/, or
other methods of public distribution.
Sincerely,
for Yuliya A. Gulis, Director
Commercial and Trade Facilitation Division
5