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HQ 089935


November 6, 1991

CLA-2 CO:R:C:M 089935 KCC

CATEGORY: CLASSIFICATION

TARIFF NO.: 8454.30.00

Mr. Karl H. Quast
Quast & Co. Inc.
332 South Michigan Avenue
Chicago, Illinois 60604

RE: Thin Strip Casting Machine; casting unit; cooling section; shear; coiler; composite machine; Note 3, Section XVI; General EN 3, Section XVI; 087740; 086736; functional unit; Note 4, Section XVI

Dear Mr. Quast:

This is in response to your letter dated July 18, 1991, concerning the tariff classification under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), of a thin strip casting machine.

FACTS:

The thin strip casting machine is a continuous caster which consists of a casting unit, a cooling section, a shear and a coiler. The continuous caster produces a thin strip or sheet with a thickness ranging from 1 - 3 mm. This process does not use hot or cold rolling mill equipment.

You state that the thin strip casting machine will be imported into the U.S. in one shipment, dissembled. You maintain that the components are to be regarded as a composite machine for tariff purposes pursuant to Note 3, Section XVI, HTSUSA. You conclude that the proper tariff classification is under subheading 8454.30.0090, HTSUSA, which provides for other casting machines of a kind used in metallurgy or in metal foundries.

ISSUE:

What is the proper tariff classification of the thin strip casting machine under the HTSUSA?

LAW AND ANALYSIS:

The classification of merchandise under the HTSUSA is governed by the General Rules of Interpretation (GRI's). GRI 1, HTSUSA, 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...."

For purposes of Note 3, Section XVI, HTSUSA, a composite machine consists of two or more machines or appliances of different kinds, fitted together to form a whole, consecutively or simultaneously performing separate functions which are generally complementary and are described in different headings of section XVI. A composite machine is classified according to its principal function.

General Explanatory Note (EN) 3 to Section XVI of the Harmonized Commodity and Description Coding System (HCDCS), states that for the purposes of [the provisions relating to composite machines and multi-function machines], machines of different kinds are taken to be fitted together to form a whole when (1) incorporated one in the other or (2) mounted one on the other, or (3) mounted on a common base or frame or in a common housing (emphasis original). Additionally, General EN 3 to Section XVI states that floors, concrete bases, walls, partitions, ceilings, etc., even if specially fitted out to accommodate machines or appliances, should not be regarded as a common base joining such machines or appliances to form a whole. HCDCS, Vol. 3, p. 1133. The Explanatory Notes, although not dispositive, are to be looked to for the proper interpretation of the HTSUSA. 54 Fed. Reg. 35127, 35128 (August 23, 1989).

We have held in Headquarters Ruling Letter (HRL) 087740 dated August 20, 1990, that a continuous casting plant consisting of a tundish/caster, shears, reduction group, edge trimmer, coilers, conveyor, hydraulics, programmable controlling apparatus and steel framework constituted a composite machine and was classifiable under subheading 8454.30.0090, HTSUSA. However, the submitted data in this case does not show that the described components are to be fitted together to form a whole within the meaning of the ENs. These components, therefore, are not classifiable as a composite machine for tariff purposes.

However, we have previously held in Headquarters Ruling Letter (HRL) 086736 dated June 7, 1990, that a tundish/melter and block caster with integral cooling unit constitutes a functional unit pursuant to Note 4, Section XVI, HTSUSA, which is classifiable as a casting machine under subheading 8454.30.0090, HTSUSA. In accordance with Note 4, Section XVI, HTSUSA, combinations of machines consisting of individual components, whether separate or interconnected, intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, are to be classified in the heading appropriate to that function. There is no single heading
either in chapter 84 or chapter 85 which covers the combination of caster, cooler, shear and coiler (thin strip casting machine) under consideration.

In this case, the thin strip casting machine consists of four components (the caster, cooler, shear, and coiler) which are designed to function together to create a thin strip or sheet of metal. As the four components function together to create the thin strip casting machine, we are of the opinion that they constitute a functional unit pursuant to Note 4, Section XVI, HTSUSA, classifiable under subheading 8454.30.0090, HTSUSA, which provides for "Converters, ladles, ingot molds and casting machines, of a kind used in metallurgy or in metal foundries, and parts thereof...Casting machines...Die casting machines."

HOLDING:

The thin strip casting machine constitutes a functional unit pursuant to section XVI, Note 4, HTSUSA, which is classifiable under subheading 8454.30.00, HTSUSA, as "...casting machines, of a kind used in metallurgy or in metal foundries, and parts thereof...Casting machines...Die casting machines."

Sincerely,

John Durant, Director
Commercial Rulings Division

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