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HQ 088585


May 2, 1991

CLA-2 CO:R:C:M 088585 CMS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8427.20.00, 8429.51.10

Mr. Stephen J. Leahy, Esq.
Leahy & Ward
63 Commercial Wharf
Boston, MA 02110

RE: Thomas Skid Steer Loader; Works Trucks Fitted With Lifting And Handling Equipment; Loading; Unloading; Self Propelled Shovel Loaders

Dear Mr. Leahy:

Your request on behalf of A.N. Deringer, Inc., dated December 28, 1990, for a classification ruling on the Thomas Skid Steer Loader has been referred by the Regional Commissioner of Customs, New York to Customs Headquarters for a reply.

FACTS:

The merchandise consists of various models of self propelled vehicles described as Thomas Skid Steer Loaders. Product literature was provided for Models T83, T103, T133, T173, T233 and T233HD.

The vehicles are designed for use with interchangeable attachments including utility and pallet forks, augers, pick up sweepers and angle brooms. The vehicles are also designed for use with many types of buckets including grapple buckets and front mounted buckets designed for dirt, produce, landscaping, snow, fertilizer, foundry, cement, grain and demolition applications.

The Loaders have lifting capacities ranging from 800 to 2,300 pounds. The vehicles feature forward and reverse drive, steering controlled by two hand levers, hydrostatic transmission and a high tensile structural tubing main frame. The Loaders have speeds ranging from 4.6 MPH to 7.2 MPH.

ISSUE:

Is the merchandise classified in Heading 8427 as fork lift trucks and other works trucks fitted with lifting or handling equipment, or in Heading 8429 as self propelled shovel loaders?

LAW AND ANALYSIS:

The Harmonized Tariff Schedules of the United States Annotated (HTSUSA) superseded the TSUS effective January 1, 1989. The HTSUSA provides that the classification of articles is governed by the General Rules of Interpretation (GRI's). GRI 1 states in pertinent part that "...classification shall be determined according to the terms of the headings and any relative section or chapter notes...".

Heading 8427 describes fork lift trucks and other works trucks fitted with lifting or handling equipment. Heading 8429 in part describes self propelled shovel loaders.

The Explanatory Notes to Heading 8429, p. 1202, state that self propelled shovel loaders "...are wheeled or crawler machines with a front mounted bucket which pick up material through motion of the machine, transport and discharge it." The Explanatory Notes constitute the Customs Cooperation Council's official interpretation of the Harmonized System and provide a commentary on the scope of each heading. H. Conf. R. No. 576, 100th Cong., 2d Sess. 549, reprinted in 1988 U.S. CODE CONG. & ADMIN. NEWS 1582.

The vehicles under consideration perform functions described by Headings 8427 and 8429 (e.g., they perform the function of Heading 8427 fork lift trucks with the pallet fork attachments, and perform the function of Heading 8429 shovel loaders with the front mounted bucket attachments).

Headings 8427 and 8429 are Section XVI headings. Section XVI Note 3 provides in part that "...machines adapted for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function."

The importer states on p. 1 of the ruling request attachment that "[t]he loaders have a variety of applications including use on farms, in feed lots, in nurseries, in foundries, factories, and warehouses for loading and stacking lumber, use as a fork lift truck, handling bagged and bulk commodities, loading trucks, pallet handling and scrap removal." This description does not appear to emphasize the vehicles' Heading 8427 functions over the Heading 8429 functions, or the Heading 8429 functions over the Heading 8427 functions.

In the descriptive literature provided with the ruling request, however, the function of the merchandise as a front mounted loader clearly predominates. The descriptive literature identifies 42 different catalogue numbers for Loaders equipped with buckets. Eleven different types of buckets are available.

Among the 42 catalogue types, 13 relate to Loaders equipped with buckets for moving materials in foundries, 8 with dirt buckets, 6 with fertilizer buckets, 5 with produce buckets and the remainder with buckets for snow, utility, demolition, cement and landscaping uses. Special buckets, and teeth kits for dirt buckets are also available.

The principal use of the Loaders as fork lift trucks or other works trucks fitted with lifting or handling equipment has not been established. To the contrary, considering the numerous types of front mounted buckets with which the vehicles operate, the wide variety of the vehicles' applications with the buckets, and the product literature, the appropriate finding is that the principal function of the vehicles is as self propelled shovel loaders. The vehicles are even described by the importer as "Loaders".

The importer argues that Heading 8429 is not the proper heading because (1) the vehicles do not "attack" the earth's crust, prepare or compact the terrain, (2) are not within the field of industry encompassed by Heading 8429, and (3) certain TSUS cases require a different result.

The importer refers to the Explanatory Notes to Heading 8429, p. 1201, which provide that "[t]he provisions of Explanatory Note 84.30 relating to self-propelled and multi- function machines apply, mutatis mutandis, to the self- propelled machinery of this heading...". The Explanatory Notes to Heading 8430, p. 1203, state in part that "[t]his heading covers machinery...for "attacking" the earth's crust...or for preparing or compacting the terrain...". The reference to the Explanatory Notes to Heading 8430 in the Explanatory Notes to Heading 8429, however, is to the provisions relating to self- propelled and multi-function machines; the Explanatory Note language to Heading 8430 referred to by the importer is not contained in the provisions relating to self-propelled and multi- function machines.

The Explanatory Notes to Heading 8429 describe machines that do not necessarily "attack", prepare or compact the terrain (e.g., the Explanatory Notes describe loader-transporters which merely pick up bulk materials and discharge them). Furthermore, the Thomas Loaders are used for working the earth, including dirt, snow and landscaping operations, and can be equipped with
teeth kits for more effective dirt working operations. The Loaders are also used for demolition operations.

The importer argues that Heading 8429 is inapplicable because the Loaders do not fall within the field of "..heavy construction, for instance, road building, mining and earth moving." Attachment to ruling request, p. 5. The importer has not established that there is a requirement that a vehicle must be used in "heavy construction" to be classified in Heading 8429. (In the importers list of Heading 8429 articles, the Explanatory Note exemplar for "loader-transporters", which merely pick up bulk materials and discharge them, is deleted).

Nevertheless, the Loaders do perform many of the functions which the importer states are within the field of "heavy industry", and perform functions of Heading 8429 articles described by the Explanatory Notes to Heading 8429 (i.e., earth digging, excavating or compacting). The product brochures for the Loaders at issue in NY Ruling 801720 (January 13, 1981), which the importer states is identical merchandise to that under consideration, state that the vehicles can be used in mines, construction sites, excavating, digging post holes and maintaining roadways.

The holding in NY Ruling 801720 or in other TSUS rulings that the merchandise was classified in Item 692.40 under the TSUS, would not require that they be classified in Heading 8427, or be precluded from Heading 8429 under the HTSUSA. The language of TSUS Item 692.40 and the terms of HTSUSA Heading 8427 are not identical. The Explanatory Notes to Heading 8429 provide guidance on the meaning of the term "shovel loader" under the HTSUSA, and the principle function of the Loaders under consideration is described by Heading 8429.

The Thomas Skid Steer Loaders, Models T83, T103, T133, T173, T233 and T233HD, are classified as shovel loaders, front-end shovel loaders, wheel type, in 8429.51.10, HTSUSA.

HOLDING:

The Thomas Skid Steer Loaders, Models T83, T103, T133, T173, T233 and T233HD, are classified as shovel loaders, front- end shovel loaders, wheel type, in 8429.51.10, HTSUSA.

Sincerely,


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