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HQ 963200




APRIL 27, 2000

CLA-2 RR:CR:GC 963200 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8207.30.30, 8207.30.60

Port Director of Customs
477 Michigan Avenue, Suite 200
Detroit, MI 48226

RE: Protest 3801-99-100252; Dies, Tools for Forming and Cutting Sheet Metal

Dear Port Director:

This is our decision on Protest 3801-99-100252, filed against your classification under the Harmonized Tariff Schedule of the United States (HTSUS), of dies for stamping and/or cutting blanks for automotive parts from sheet metal. The entries under protest were liquidated on February 19 and 26, 1999, and this protest timely filed on May 19, 1999. Counsel for the protestant presented additional facts and legal arguments at a meeting in our office on February 11, 2000.

FACTS:

The merchandise is a series or “line” of dies that are tools that operate individually in transfer lines or presses to cut out, form, or both cut out and form larger automotive parts such as trunk, hood and door panels from sheet metal. The dies move together from station to station in the transfer line as the part is formed. Some of the dies at issue perform only a cutting function, some perform only a forming function, while others perform both cutting and forming functions. As imported, however, the dies are separately packed and each is mounted in its own holder called a “shoe” or plate, and each is used on a separate station within the transfer line. Separate letters from a die maker and a die supplier indicate that in the automotive industry these dies are bought and sold in “lines” and used together to form sheet metal parts; they are invoiced together and all the dies in a line are required to make a part; individual dies in a line cannot be used apart from other dies in the same line; individual replacement dies are rarely imported separately, that is, is one die fails it is normally serviced or repaired, not replaced.

The dies were entered under a provision of heading 8207, HTSUS, for pressing, stamping or punching tools, not suitable for cutting metal. Customs determined that the dies were suitable for cutting metal. Accordingly, the entries were liquidated under an alternative provision of heading 8207 for tools suitable for cutting metal.

The HTSUS provisions under consideration are as follows:

Interchangeable tools for handtools...or for machine-tools..., including dies for drawing or extruding metal...:

8207.30 Tools for pressing, stamping or punching, and parts thereof:

8207.30.30 Suitable for cutting metal, and parts thereof

8207.30.60 Not suitable for cutting metal, and parts thereof

ISSUE:

Whether the dies at issue qualify as composite goods for tariff purposes; if not, whether the individual dies are considered not suitable for cutting metal.

LAW AND ANALYSIS:

Under General Rule of Interpretation (GRI) 1, Harmonized Tariff Schedule of the United States (HTSUS), goods are to be classified according to the terms of the headings and any relative section or chapter notes, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6. GRI 3(b), HTSUS, states in part that composite goods made up of different components are to be classified as if consisting of the component which gives them their essential character, insofar as this criterion is applicable.

The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. Though not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and Customs believes the ENs should always be consulted. See T.D. 89-80. 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

On protest, the importer maintains that subheading 8207.30.60, HTSUS, tools not suitable for cutting metal, represents the correct classification. The dies are characterized as “die sets,” each having one part number and invoiced as a complete set. The claim is that, as imported, the dies are composite goods under GRI 3(b), and that the forming dies classified in subheading 8207.30.60 impart the essential character to the whole. Citing an administrative ruling on progressive die units, the claim is that the forming dies impart the size and shape to, and perform most of the technical operations on each part blank, with the cutting operations being merely incidental and subordinate to the forming. Alternatively, if the dies must be separately classified, the claim is those that perform only forming and only cutting operations must be classified in their respective subheadings, while those that perform both forming/piercing operations as well as cutting/trimming operations should be classified in subheading 8207.30.60, according to the essential character analysis outlined above.

The broker cites HQ 952717, dated January 22, 1993, in which Customs classified progressive die units in subheading 8207.30.60, HTSUS, citing the authority of GRI 3(b), applied at the subheading level through GRI 6. The dies in that case each performed individual forming and cutting operations, respectively, and, in some cases, combined cutting/forming operations. But the die units in HQ 952717, as imported, were in a holder called a “shoe” or plate. They were composite goods with components (i.e., the dies) attached to each other to form a practically inseparable whole. This required the essential character analysis that resulted in the subheading 8207.30.60 classification. HQ 952717 is not authority for classifying the dies at issue here.

However, relevant ENs, on p. 4, state that for purposes of GRI 3(b) composite goods made up of different components shall be taken to mean not only those in which the components are attached to each other to form a practically inseparable whole but also those with separable components, provided these components are adapted one to the other and are mutually complementary and that together they form a whole which would not normally be offered for sale in separate parts (Emphasis added). The same EN also states that as a general rule, the components of composite goods are put up in a common packing. In our opinion, components are separable, for purposes of this EN, if they have become disunited or divided into parts. This logically suggests that at one time the components were designed to be combined, joined or united in some way. In this case, the manner in which the individual dies are used and the functions they perform suggest they are adapted one to the other and are mutually complementary. But, the facts here also indicate that, as imported, the dies are separately packed, are never in the same die shoe, and are used on separate stations in the transfer line. This is evidence that the dies are separate and distinct articles of commerce that together do not form a whole. The dies at issue are not composite goods under GRI 3(b) and must be separately classifiable.

Subheadings 8207.30.30 and 8207.30.60 are mutually exclusive. That is, dies classifiable in one subheading cannot be classified in the other. In a related agricultural context, articles are "suitable for use" if they are actually, practically and commercially fit for the required use. Evidence of sole use or even principal use is not required. However, there must be evidence of substantial actual use as required by the involved provision. It necessarily follows that dies whose specific design features enable them to both form and cut metal, are actually, practically and commercially fit for cutting metal. Therefore, subheading 8207.30.60 is eliminated as to such dies.

HOLDING:

Dies for transfer lines or presses designed only for stamping blanks for automotive parts from sheet metal are provided for in heading 8207. They are not suitable for cutting metal and are classifiable in subheading 8207.30.60, HTSUS. These dies should be reclassified as indicated, and the protest ALLOWED as to these dies.

Dies for transfer lines or presses designed only for cutting blanks for automotive parts from sheet metal, and dies that both form and cut blanks for automotive parts are suitable for cutting metal and are classifiable in subheading 8207.30.30, HTSUS. The protest should be DENIED as to these dies.

In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

John Durant, Director
Commercial Rulings Division

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