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HQ 087703


JAN 18 1991

CLA-2:CO:R:C:G 087703 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8436.80.0090, HTSUSA

John B. Rehm, Esq.
Dorsey & Whitney
330 Connecticut Avenue, N.W.
Washington, D.C. 20036

RE: Composting Machinery, Farm Type; Non-Industrial Composter

Dear Mr. Rehm:

In a letter, dated August 7, 1990, on behalf of Ryan Construction Company of Minnesota, Inc., you inquire as to the tariff classification of machinery from France for transforming organic waste materials into compost. A November 19, 1990, meeting in our office, confirmed by a December 21, 1990, telefax complete the record. Our ruling follows.

FACTS:

Submitted literature describes machinery, designated the Siloda, which will be used by a solid waste treatment plant consisting of two components, a paddle wheel and transfer lorry. A side travel mechanism and screw augur are integral with the paddle wheel.

Municipal garbage trucks unload garbage and other solid waste onto a mobile shuttle overhead conveyor - not a part of this importation - which deposits the waste in the first of two rows of five silos each. Each silo is horizontal and measures approximately 140 ft. x 13 ft., surrounded by 5 ft. 9 in. concrete walls. The Siloda can process between 40,000 and 120,000 cubic yards of organic waste each year to produce between 5,000 and 60,000 tons of compost.

The paddle wheel consists of a hollow cylinder fitted with steel loading paddles and rotates on its axis to turn over, slice, chop and aerate the waste. Domestically sourced blowers provide additional oxygen for what is essentially a fermentation process. The rotating wheel then raises the waste
to a height from which it falls by gravity into a trough or hopper inside the wheel, then to the screw augur which transfers it to the next silo where the process is repeated. The side travel mechanism or drive wheel is an integral part of the paddle wheel and enables it to rotate inside a silo along its entire length. It consists mainly of two supporting blocks, each with two motor-driven wheels and tires.

The second component in issue here is a lorry called a transfer crab. It is a motor-driven wheeled chassis with transmission designed to run on rails. Although it has a hydraulic loading/unloading device, it functions to carry the paddle wheel between silos.

The waste is moved between silos every four days. After about a month you state the waste has reached a degradation level of 60 percent which qualifies it as class 1 compost. The product is to be sold to farmers to enhance the subsoil and to replace eroded topsoil.

You maintain that the common meaning of the term "agriculture" encompasses cultivation of the soil, harvesting of crops, or the production of plants and animals. As such, the machinery in issue here qualifies as agricultural machinery and is classifiable duty-free as other agricultural and horticultural machinery in subheading 8436.80.0090, Harmonized Tariff Schedule of the United States Annotated (HTSUSA).

ISSUE:

Whether the components in issue qualify as agricultural or horticultural machinery of the type provided for in heading 8436.

LAW AND ANALYSIS:

Merchandise is classifiable under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA) in accordance with the General Rules of Interpretation (GRIs). GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided the headings or notes do not otherwise require, according to GRIs 2 through 6.

In common meaning, the term agriculture relates to the art or science of cultivating the soil, growing crops, or raising animals for food or clothing, while horticulture relates similarly to fruits, vegetables, flowers or shrubs. We agree that machinery of the type in issue here, which produces compost for use as a soil nutrient on farms, in gardens, nurseries or greenhouses, orchards, etc. is sufficiently agricultural or horticultural for tariff purposes.

The Explanatory Notes (ENs) constitute the Customs Cooperation Council's official interpretation of the Harmonized System. While not legally binding, the notes provide a commentary on the scope of each heading of the HS and are useful in ascertaining the classification of merchandise under the System. Customs believes the ENs should always be consulted. See T.D. 89-80. ENs at p. 1217 indicate that heading 8436 covers machinery which is of the type used on farms (including agricultural schools, co-operatives or testing stations), in forestry, market gardens, or poultry-keeping or bee-keeping farms or the like. However, it excludes machines clearly of a kind designed for industrial use. (Emphasis added).

The ENs distinguish farm-type machines from industrial machines, but provide little guidance on how this distinction is to be made. The provision in heading 8436 is governed by the concept of principal use. See U.S. Rule of Interpretation 1(a), HTSUSA. You have provided evidence of at least two U.S. manufactured composting machines used on a turkey farm and chicken farm (in Ephraim, Utah, and Potosi, Mo., respectively), with processing/output capabilities within those of the Siloda. In the absence of other evidence of similar machines used in industrial, non-farm applications, we conclude that the instant machine belongs to a class or kind of composting machinery principally used on farms, industrial schools, co-operatives or testing stations and the like.

HOLDING:

Under the authority of GRI 1, the composite article consisting of the paddle wheel, side travel mechanism and screw augur, is provided for in heading 8436, other agricultural or horticultural machinery. Actual classification is in subheading 8436.80.0090, HTSUSA, other machines. The rate of duty is free.

This ruling is based on the evidence available to us at this time. As additional evidence is developed on the principal use of the class or kind of composting machinery to which the Siloda belongs, we may have cause to review the matter.

Sincerely,

John Durant, Director
Commercial Rulings Division

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