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HQ 956345




February 16, 1995

CLA-2 CO:R:C:M 956345 LTO

CATEGORY: CLASSIFICATION

TARIFF NO.: 8703.24.00

Mr. James H. Lehmann, Jr.
Land Rover North America, Inc.
4930 Parliament Place
P.O. Box 1503
Lanham, Maryland 20706

RE: Two-door Land Rover Defender 90; sports-utility vehicle; heading 8704; HQ 957352; Marubeni America Corp. v. U.S.

Dear Mr. Lehmann:

This is in response to your letter of December 28, 1994, requesting the classification of the 1994 two-door Land Rover Defender 90 under the Harmonized Tariff Schedule of the United States (HTSUS).

FACTS:

The 1994 Land Rover Defender 90 is a 92-inch wheel based, four-wheel drive, four-passenger, two-door, sports-utility vehicle. It has two permanent rows of seats and a third door, hinged on the side, at the rear of the vehicle. The front row of seats consist of two separate arm-chair seats which are divided by a center console. The second row is a permanently installed bench seat with a fold-down back rest.

The rear area of the vehicle is fully carpeted and equipped with rear speakers. The rear area is restricted by two platforms which serve as the wheel wells and which run the entire length of the rear area from behind the front seats to the rear door. The platforms are approximately 6.5 inches high when measured from the floor, and they take up over half of the rear area. The vehicle's spare tire is located on the outside rear of the vehicle. The vehicle has an open roll cage that is used to anchor the rear shoulder belts, provide rear support for various soft top roof and rack accessories and serve as some passenger protection in the event of a low speed, off-road rollover.

The 1994 Land Rover Defender 90 is 160.5 inches long, 70.5 inches wide, 80.3 inches in height, and has a gross vehicle weight of 6,001 pounds. The vehicle has a 3.9. liter fuel- injected, eight-cylinder engine with a five-speed manual transmission. It is built on a frame with a ground clearance of 9.0 inches. It has coil springs and disc brakes on all four wheels and is equipped with front and rear sway bars.

ISSUE:

Whether the 1994 two-door Land Rover Defender 90 is classifiable as a motor vehicle principally designed for the transport of persons under heading 8703, HTSUS, or as a motor vehicle for transport of goods under heading 8704, HTSUS.

LAW AND ANALYSIS:

The General Rules of Interpretation (GRI's) to the HTSUS govern the classification of goods in the tariff schedule. GRI 1 states in pertinent part that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes . . . ."

The headings at issue are as follows:

8703 Motor cars and other motor vehicles principally designed for the transport of persons . . ., including station wagons and racing cars

8704 Motor vehicles for the transport of goods

In Marubeni America Corp. v. U.S., Appeal No. 93-1467 (September 7, 1994), the CAFC affirmed the determination of the Court of International Trade that the Nissan Pathfinder was classifiable as a motor vehicle principally designed for the transport of persons under heading 8703, HTSUS, dutiable at 2.5 percent, rather than as a motor vehicle for the transport of goods under heading 8704, HTSUS, dutiable at 25 percent (pursuant to subheading 9903.87.00, HTSUS). See Marubeni America Corp. v. U.S., 821 F.Supp. 1521 (1993).

The CAFC stated that for a vehicle to be classified under heading 8703, HTSUS, the "vehicle's intended purpose of transporting persons must outweigh an intended purpose of transporting goods." In making this determination, the Court stated that it is necessary to consider both the structural and auxiliary design features. Additionally, the Court found that the number of doors on the vehicle was not determinative.

Structural features that would lead to the classification of a vehicle under heading 8703, HTSUS, include: a rear passenger seat; side and rear windows (in an enclosed vehicle); a rear suspension suitable for rear passengers; and any other intrusions into the vehicle's cargo-carrying capability, such as, the inclusion of a spare tire in the rear of the vehicle.

Relevant auxiliary features include: rear seat stereo outlets, ashtrays, cubbyholes, arm rests, handholds, footwells, seat belts and child seat tie down hooks; carpeted cargo area; and any other passenger amenities.

The 1994 two-door Land Rover Defender 90 has a permanently installed, 2 passenger bench seat with a fold-down back rest. The vehicle lacks either a traditional roof or sidewalls, as it is totally open with only the bottom half of the two front doors installed and a side-wall that is 20 inches high. The rear door is also only 20 inches high. While materials can be stacked higher than the rear door's 20 inches, there is no surrounding structure to hold these items in place. Moreover, the rear door does not allow full access to the cargo area, as it is hinged on the side and opens only approximately 120 degrees from its closed position.

Further, while the spare tire is located on the outside rear of the vehicle, the cargo-carrying capability of Land Rover's rear has been otherwise limited by the existence of two platforms which serve as the vehicle's wheel wells. The platforms are approximately 6.5 inches high when measured from the floor, and they take up over half of the rear area. The vehicle also has an open roll cage that limits its rear cargo area and is used to anchor the rear shoulder belts, provide rear support for various soft top roof and rack accessories and serve as some passenger protection in the event of a low speed, off-road rollover. Finally, the rear of the vehicle includes many passenger amenities, including seat belts, carpeting and speakers.

It is our opinion that the structural and auxiliary design features of the 1994 two-door Land Rover Defender 90, like the Nissan Pathfinder, demonstrate that the vehicle's intended purpose of transporting persons outweighs an intended purpose of transporting goods. See HQ 957352, dated December 27, 1994 (Ford Explorer). Accordingly, the vehicle is classifiable under heading 8703, HTSUS.

HOLDING:

The 1994 two-door Land Rover Defender 90 is classifiable under subheading 8703.24.00, HTSUS, which provides for motor vehicles principally designed for the transport of persons, with - 4 -
spark-ignition internal combustion reciprocating piston engine, of a cylinder capacity exceeding 3,000 cc. The corresponding rate of duty for articles of this subheading is 2.5% ad valorem.

Sincerely,

John Durant, Director

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