HQ 0954931 - Water Reduction Device; Solenoid Valve; Plastic Casing; Stainless Steel Back Plate; Brass Fittings; Braided Supply Tube; Shock Absorber; Motion Sensor; General Note 3(c)(vii)(A) and (B)(1); GRI's 2(a) and 3(b); Composite Good; Explanatory - United States International Trade Commision Rulings

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HQ 954931
October 29, 1993

CLA-2 CO:R:C:M 954931 DWS

CATEGORY: CLASSIFICATION

TARIFF NO.: 3926.90.95; 7326.90.90; 7419.99.50; 8307.10.30; 8479.89.90; 8481.80.90; 8536.50.00

Mr. Roy Lachance, Vice President
Enviro-Scope Water Solutions Corp.
181 Cocksfield Avenue, Suite 5
Downsview, Ontario
Canada M3H 3T4

RE: Water Reduction Device; Solenoid Valve; Plastic Casing; Stainless Steel Back Plate; Brass Fittings; Braided Supply Tube; Shock Absorber; Motion Sensor; General Note 3(c)(vii)(A) and (B)(1); GRI's 2(a) and 3(b); Composite Good; Explanatory

Dear Mr. Lachance:

This is in response to your letter of July 27, 1993, concerning the classification of a complete water reduction device and its parts imported together in an unassembled form, and individual parts imported separately, under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The merchandise consists of a water reduction device (model no. AKP-93) for urinal flush tanks. The AKP-93 is comprised of a plastic casing, a stainless steel back plate, a solenoid valve, brass fittings, and a braided supply tube, all products of Canada, and a motion sensor and shock absorber, both products of the U.S. The occupancy sensor operated control valve is installed on the water supply line to the flush tank to control water consumption. The shock absorber is present to reduce any sudden water pressure surges in the water line.

Whenever occupancy is sensed, the AKP-93 opens the supply valve to the flush tank and allows the tank to fill and flush. A built-in timer will hold the valve open for a pre-set period to insure at least one more flush after the last use. The AKP-93 measures 6 inches by 8 inches by 12 inches, and operates at 120 volts (V).

The subheadings under consideration are as follows:

3926.90.95: [o]ther articles of plastics and articles of other materials of headings 3901 to 3914: [o]ther: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 5.3 percent ad valorem.

7326.90.90: [o]ther articles of iron or steel: [o]ther: [o]ther: [o]ther: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 5.7 percent ad valorem.

7419.99.50: [o]ther articles of copper: [o]ther: [o]ther: [o]ther: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 5 percent ad valorem.

8307.10.30: [f]lexible tubing of base metal, with or without fittings: [o]f iron or steel: [w]ith fittings.

The general, column one rate of duty for goods classifiable under this provision is 5.8 percent ad valorem.

8479.89.90: [m]achines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: [o]ther machines and mechanical appliances: [o]ther: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 3.7 percent ad valorem.

8481.80.90: [t]aps, cocks, valves and similar appliances, for pipes, boiler shells, tanks, vats or the like, including pressure-reducing valves and thermostatically controlled valves; parts thereof:
[o]ther appliances: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 3.7 percent ad valorem.

8536.50.00: [e]lectrical apparatus for switching or protecting electrical circuits, or for making connections to or in electrical circuits (for example, switches, relays, fuses, surge suppressors, plugs, sockets, lamp-holders, junction boxes), for a voltage not exceeding 1,000 V: [r]elays: [o]ther.

The general, column one rate of duty for goods classifiable under this provision is 5.3 percent ad valorem.

ISSUE:

Whether the AKP-93, imported from Canada in a complete and either assembled or unassembled form, qualifies for favorable treatment under the U.S.-Canada Free-Trade Agreement.

Whether the individual parts of the AKP-93, imported separately, qualify for favorable treatment under the U.S.-Canada Free-Trade Agreement.

Under which provision is the AKP-93, imported in a complete and either assembled or unassembled form, classifiable under the HTSUS?

LAW AND ANALYSIS:

Classification of merchandise under the HTSUS is in accordance with the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification is determined according to the terms of the headings and any relative section or chapter notes.

INDIVIDUAL PARTS

In accordance with GRI 1, it is our position that the plastic casing is classifiable under subheading 3926.90.95, HTSUS, the stainless steel back plate is classifiable under subheading 7326.90.90, HTSUS, the brass fittings are classifiable under subheading 7419.99.50, HTSUS, the braided steel supply tube is classifiable under subheading 8307.10.30, HTSUS, the shock absorber is classifiable under subheading 8479.89.90, HTSUS, the solenoid valve is classifiable under subheading 8481.80.90, HTSUS, and the motion sensor is classifiable under subheading 8536.50.00, HTSUS.

General Note 3(c)(vii)(A) and (B)(1), HTSUS, states:

(vii) United States-Canada Free-Trade Agreement Implementation Act of 1988.

(A) Goods originating in the territory of Canada that are described in Annex 401.2(B) of the United States-Canada Free Trade Agreement, entered into on January 2, 1988, are subject to duty as provided herein. Goods originating in the territory of Canada, as defined in subdivision (c)(vii)(B) of this note, that are imported into the customs territory of the United States and that are entered under a provision for which a rate of duty appears in the "Special" subcolumn followed by the symbol "CA" in parentheses are eligible for the tariff treatment set forth in the "Special" subcolumn, in accordance with section 201 of the United States-Canada Free-Trade Agreement Implementation Act of 1988.

(B) For the purposes of subdivision (c)(vii) of this note, goods imported into the customs territory of the United States are eligible for treatment as "goods originating in the territory of Canada" only if --

(1) they are goods wholly obtained or produced in the territory of Canada and/or the United States . . .

Because all of the components which comprise the AKP-93 are from Canada and the U.S., under General Note 3(c)(vii), HTSUS, the components are goods originating from the territory of Canada. Therefore, upon compliance with the U.S.-Canada Free-Trade Agreement and sections 10.301 - 10.311, Customs Regulations (19 CFR 10.301 - 10.311), whichever of the components are imported separately into the U.S from Canada will receive favorable duty treatment. The same principle applies to the complete AKP-93 which is imported from Canada.

IMPORTED IN COMPLETE AND ASSEMBLED FORM

Because the AKP-93 is a composite good, GRI 3(b) must be consulted. It states that:

[m]ixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

The AKP-93 is comprised of several components which are each classifiable under a respective provision in the HTSUS. The components are described under the following provisions: headings 3926, 7326, 7419, 8307, 8479, 8481, and 8536, HTSUS. Under GRI 3(b), we must determine the component which imparts the essential character of the AKP-93.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes, although not dispositive, are to be used to determine the proper interpretation of the HTSUS. 54 Fed. Reg. 35127, 35128 (August 23, 1989). Explanatory Note 3(b)(VIII) (p. 4) states that:

[t]he factor which determines essential character will vary as between different kinds of goods. It may, for example, 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 goods.

It is our position that the solenoid valve imparts the essential character of the AKP-93. It is the valve which allows the urinal flush tank to fill with water. Without the valve, the AKP-93 would not be able to operate in an effective manner. Therefore, we find that the valve has the primary role in relation to the use of the AKP-93.

Consequently, the AKP-93, imported in a complete and assembled form, is classifiable under subheading 8481.80.90, HTSUS.

IMPORTED IN COMPLETE AND UNASSEMBLED FORM

GRI 2(a) state that:

[a]ny reference in a heading to an article shall be taken to include a reference to that article incomplete or unfinished, provided that, as entered, the incomplete or unfinished article has the essential character of the complete or finished article. It shall also include a reference to that article complete or finished (or falling to be classified as complete or finished by virtue of this rule), entered unassembled or disassembled.

Explanatory Note 2(a)(V) (p. 2) states that:

[t]he second part of Rule 2(a) provides that complete or finished articles presented unassembled or disassembled are to be classified in the same heading as the assembled article. When goods are so presented, it is usually for reasons such as requirements or convenience of packing, handling or transport.

In part, Explanatory Note 2(a)(VII) (p. 2) states that:

[f]or the purposes of this Rule, "articles presented unassembled or disassembled" means articles the components of which are to be assembled either by means of simple fixing devices (screws, nuts, bolts, etc.) or by riveting or welding, for example, provided only simple assembly operations are involved.

Because the unassembled and complete AKP-93 has the essential character of an assembled and complete AKP-93, it is also classifiable under subheading 8481.80.90, HTSUS. It is our understanding that the AKP-93 will be presented in an unassembled manner for convenience of packing, handling, or transport, and, once imported into the U.S., the AKP-93 is assembled utilizing simple assembly operations.

You have also requested that we classify the above articles if imported into Canada from the U.S. For answers to your questions on this matter, we suggest that you contact Revenue Canada, the Customs agency in Canada.

HOLDING:

If the individual components of the AKP-93 are imported separately, the plastic casing is classifiable under subheading 3926.90.95, HTSUS, as an other article of plastics; the stainless steel back plate is classifiable under subheading 7326.90.90, HTSUS, as an other article of steel; the brass fittings are classifiable under subheading 7419.99.50, HTSUS, as other articles of copper; the braided supply tube is classifiable under subheading 8307.10.30, as flexible tubing of steel, with fittings; the shock absorber is classifiable under subheading 8479.89.90, HTSUS, as an other mechanical appliance; the solenoid valve is classifiable under subheading 8481.80.90, HTSUS, as an other valve appliance; and the motion sensor is classifiable under subheading 8536.50.00, as an other switch.

Goods classifiable under these provisions and originating in Canada, upon meeting the requirements of sections 10.301 - 10.311, Customs Regulations (19 CFR 10.301 - 10.311), receive 2.6 percent ad valorem, 2.8 percent ad valorem, 2.5 percent ad valorem, 2.9 percent ad valorem, duty-free treatment, duty-free treatment, and 2.6 percent ad valorem, respectively, under the U.S.-Canada Free- Trade Agreement.

The AKP-93, imported in a complete and either assembled or unassembled form, is classifiable under subheading 8481.80.90, HTSUS.

Sincerely,

John Durant, Director

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