CLA-2-85:OT:RR:NC:N2:120
Jeremy Bloch
Dell Will Customs Brokers
26480 Northline Commerce Drive
Taylor, MI 48180
RE: The tariff classification of a hybrid generator set from China
Dear Mr. Bloch:
In your letter dated August 28, 2017 you requested a tariff classification ruling on behalf of your client, Trinidad Drilling.
The merchandise under consideration is referred to as the Solar Hybrid LED Light Tower which is a machine consisting of a telescoping 1200 Watt LED light tower, 8 monocrystalline photovoltaic generator panels totaling a combined 2,680 Watts, a 50 kWatt diesel generating set, a charge controller, and a battery bank of 12 continuous discharge batteries. All of the foregoing are mounted to or inside an enclosed three axle utility trailer.
In use, the subject Solar Hybrid LED Light Tower is positioned at remote job sites for the purpose of generating electricity for the work area while providing light via the deployed telescoping light tower. We would note that for the purposes of Section 16 Note 3, Harmonized Tariff Schedule of the United States (HTSUS), the subject merchandise is considered a composite good where the principal function is the generation of electricity. However, there are two distinct types of electrical generators present: the photovoltaic panels that are classifiable in heading 8501, HTSUS, and the diesel generating set that is classifiable in heading 8502, HTSUS.
The classification of merchandise under the HTSUS is governed by the General Rules of Interpretation ("GRIs"), taken in order. GRI 1 requires that classification be determined according to the terms of the headings and any relative section or chapter notes. In the event that 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 will be applied, in the order of their appearance.
Goods that are, prima facie, classifiable under two or more headings, are classifiable in accordance with GRI 3, HTSUS. GRI 3(a) states in part when two or more headings each refer to part only of the materials or substances contained in mixed or composite goods, those headings are to be regarded as equally specific, even if one heading gives a more precise description of the good. Goods classifiable under GRI 3(b) are classified as if they consisted of the material or component which gives them their essential character, which may be determined by the nature of the material or component, its bulk, quantity, weight or value, or by the role of a constituent material in relation to the use of the article. GRI 3(c) provides that when goods cannot be classified by reference to GRI 3(a) or 3(b), they are to be classified in the heading that occurs last in numerical order among those which equally merit consideration.
When interpreting and implementing the HTSUS, the Explanatory Notes (ENs) of the Harmonized Commodity Description and Coding System may be utilized. The ENs, while neither legally binding nor dispositive, provide a guiding commentary on the scope of each heading, and are generally indicative of the proper interpretation of the HTSUS.
The ENs to heading 85.01 states, in pertinent part: “This heading also covers photovoltaic generators consisting of panels of photocells combined with other apparatus, e.g., storage batteries and electronic controls) voltage regulator, inverter, etc.).” Thus, we find that the solar panels combined with the charge controller and battery bank, in the current configuration are, classifiable in heading 8501, HTSUS. Further, the ENs to heading 85.02 states, in pertinent part: “The expression “generating sets” applies to the combination of an electric generator and any prime mover other than an electric motor (e.g., hydraulic turbines, steam turbines, wind engines, reciprocating steam engines, internal combustion engines). Generating sets consisting of the generator and its prime mover which are mounted (or designed to be mounted) together as one unit or on a common base (see the General Explanatory Note to Section XVI), are classified here provided they are presented together (even if packed separately for convenience of transport).” Accordingly, we find that the diesel generating set is classifiable in heading 8502, HTSUS.
As the principal function of the Solar Hybrid LED Light Tower is to generate electricity, and the product in question has two distinct types of electrical generation which are, prima facie, classifiable under two or more headings, the GRIs direct us to employ GRI 3(c), HTSUS, which states that in such circumstances the classification will be the heading that appears last in numerical order among those which equally merit consideration. In this particular case, the heading for the diesel generating set appears last in numerical order. Consequently, the subject Solar Hybrid LED Light Tower will be classified according to its principal function of generating power as a diesel generating set.
The applicable subheading for the Solar Hybrid LED Light Tower will be 8502.11.0000, Harmonized Tariff Schedule of the United States (HTSUS), which provides for "Electric generating sets…: Of an output not exceeding 75 kVA." The rate of duty will be 2.5%.
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 on World Wide Web at https://hts.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Karl Moosbrugger at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division