CLA-2-87:OT:RR:NC:N2:201
Ryan Pratt, LCB
BMW of North America, LLC
PO Box 1227
Westwood, NJ
07675-1227
RE: The tariff classification of 2020 BMW 540i from Germany
Dear Mr. Pratt:
In your letter dated April 24, 2020, you requested a tariff classification ruling.
The item under consideration has been identified as a 2020 BMW 540i with a 48V system. You state in your request that the 540i is equipped with a 2998cc, 6-cylinder spark-ignition internal-combustion engine with a 48V Belt System Generator (BSG), which serves to reduce CO2 emissions and fuel consumption respectively. This system is sometimes referred to as a “mild-hybrid”, in which the system assists the internal combustion engine but does not allow for an electric-only method of propulsion. You state that the 48V system consists of the following three (3) core components:
48V battery
In addition to the 12V Battery
DC/DC converter
Converts the voltage from 48V to 12V and vice versa
48V belt-driven-starter-generator (BSG)
operates as an alternator as well as an electric motor
The 48V starter-generator cannot propel the vehicle alone. However, the 48V starter-generator can support the combustion engine briefly during acceleration.
You request clarification on whether the 2020 BMW 540i with a 48V mild-hybrid system, is classified in 8703.23.0160 or 8703.40.0030.
8703.23.0160 provides for “Other vehicles, with only spark-ignition internal combustion
reciprocating piston engines; Of a cylinder capacity exceeding 1,500 cc but not exceeding
3,000 cc; Having engines with more than 4 cylinders but not more than 6 cylinders.”
8703.40.0030, provides for “Other vehicles, with both spark-ignition internal combustion reciprocating piston engine and electric motor as motors for propulsion, other than those capable of being charged by plugging to external source of electric power; Of a cylinder capacity exceeding 1,500 cc but not exceeding 3,000 cc; Having engines with more than 4 cylinders but not more than 6 cylinders.”
GRI 1 states the “classification shall be determined according to the terms of the headings
and any relative section or chapter notes”.
GRI 6 states “For legal purposes, the classification of goods in the subheadings of a heading
shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable.”
Based on the terms of the headings and subheadings, using GRI 1 and GRI 6, it is the opinion of this office that the 2020 BMW 540i with a 48V system utilizes the electric motor only to restart the internal combustion engine. The electric motor does not provide any motive power that would allow it to be classified as a vehicle that uses both a spark-ignition internal combustion reciprocating piston engine and an electric motor as motors for propulsion.
The applicable subheading for the 2020 BMW 540i with 48V mild hybrid system will be 8703.23.0160, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Other vehicles, with only spark-ignition internal combustion reciprocating piston engines; Of a cylinder capacity exceeding 1,500 cc but not exceeding 3,000 cc; Having engines with more than 4 cylinders but not more than 6 cylinders.”. The rate of duty will be 2.5% ad valorem.
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 the 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 Matthew Sullivan at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division