United States International Trade Commision Rulings And Harmonized Tariff Schedule
faqs.org  Rulings By Number  Rulings By Category  Tariff Numbers
faqs.org > Rulings and Tariffs Home > Rulings By Number > 2001 HQ Rulings > HQ 964723 - HQ 964837 > HQ 964757

Previous Ruling Next Ruling
HQ 964757




September 25, 2001

CLA-2 RR:CR:GC 964757BJB

CATEGORY: CLASSIFICATION

TARIFF NO.: 7308.00.00

Mr. Thomas Martin
A.N. Deringer, Inc.
6930 Metroplex Drive
Romulus, MI 48174

RE: NY E82319 Revoked; Steel towers for wind-driven turbine electric generator.

Dear Mr. Martin:

This is in reference to NY E82319, dated June 3, 1999, which the Director of Customs National Commodity Specialist Division, New York, issued to you on behalf of Canam Steel Works, Inc. In that ruling, a steel tower used to support a wind-driven turbine electric generator, was classified in subheading 8503.00.9545, of the Harmonized Tariff Schedule of the United States (HTSUS). We have reviewed that classification, and have determined that it is incorrect. This ruling revokes NY E82319 and sets forth the correct classification.

Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI, (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. 103-182, 107 Stat. 2057 (1993), a notice of proposed revocation was published on August 8, 2001, in the Customs Bulletin, Volume 35, Number 32, proposing to revoke NY E82319, dated June 3, 1999, and to revoke the tariff treatment pertaining to the tariff classification of a steel tower. The only comment received in response to this notice, which you submitted, opposed the revocation.

FACTS:

The merchandise is a tower used to support a wind-driven turbine electric generator. Towers for these wind-driven turbines may be tubular steel towers, lattice towers, or concrete towers. Guyed tubular towers are only used for smaller turbines. The subject tower is composed of flat-rolled steel pieces welded together to form sections of a long, tubular structure. These sections are then bolted together on site where a wind-driven turbine electric generator is
secured to the top. A completed tower is approximately 176 feet in height. Each section has ladders and landings to enable access to the tower and the generator. Most large wind turbines are delivered with tubular steel towers. The subject towers are not manufactured by the same company that produces the wind-driven electric turbines. The towers do not provide operational or mechanical interaction with the turbine or its rotor.

Towers are usually bolted onto the concrete foundations where the generators are placed. In some cases, where the bottom of the section of the tower is cast into the concrete foundation, and where the lowest section of the tower is subsequently welded together directly on the site, the tower must be fitted with special guides and clamps to hold the two tower sections in place while welding of the remaining sections is completed.

Most modern towers for wind-driven turbine electric generators are conical, tubular steel towers. Towers are assembled from smaller, conical subsections which are cut and rolled into the right shape, and then welded together. Towers for these turbines are generally designed by the individual turbine manufacturer since the entire wind-driven turbine has to be type approved as a unit. Even if some towers are manufactured by independent producers, the towers must conform to industry engineering standards and take into consideration the size, weight, and other specifications of a particular turbine. Although many specialized manufacturers generally produce or construct these towers, when the distance to the operational site is great, and the project is large, the towers may often be locally manufactured.

ISSUE:

Whether the steel tower is classifiable under heading 7308, HTSUS, as a structure of steel, or under heading 8503, HTSUS, as a part of such equipment, or goods or parts of goods of another heading in chapter 84 or 85?

LAW AND ANALYSIS:

Merchandise is classifiable under the HTSUS, in accordance with the General Rules of Interpretation (GRIs). GRI 1 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, and provided the headings or notes do not require otherwise, according to GRIs 2 through 6.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes may be utilized. The Explanatory Notes (ENs), although not dispositive or legally binding, provide a commentary on the scope of each heading of the HTSUS, and are generally indicative of the proper interpretation of these headings. Customs believes the ENs should always be consulted. See T.D. 98-80, 54 Fed. Reg. 35127, 35128 (Aug. 23, 1989).

The HTSUS provisions under consideration are as follows:

Structures (excluding prefabricated buildings of heading 9406) and parts of structures (for example, bridges and bridge sections, lock gates, towers, lattice masts, roofs, roofing frameworks, doors and windows and their frames and thresholds for doors, shutters, balustrades, pillars and columns) of iron or steel; plates, rods, angles, shapes, sections, tubes and the like, prepared for use in structures, of iron or steel:

Towers and lattice masts . . . . . . . . . .

Electric generating sets and rotary converters:

8503.00 Parts suitable for use solely or principally with the machines of heading 8501 or 8502:

8503.00.95 Other . . . . . . . . . .

In NY E82319, Customs determined that the steel towers were specifically designed to support wind-driven turbine electric generators, and that they were classifiable in subheading 8503.00.9545, HTSUS, which provides for “parts suitable for use solely or principally with the machines of heading 8501 and 8502, HTSUS, “other[,] other, parts of generators.”

You maintain that these towers are not structures of iron or steel, provided for in heading 7308 but, based on a decision of the Court of Appeals for the Federal Circuit, are “parts” of an electric motor. You note that the towers are generally designed by the individual turbine manufacturer since the entire wind-driven turbine has to be approved as a unit, and that even if manufactured by independent producers, the towers conform to industry engineering standards. From this, you conclude that if a tower is designed specifically for an electric generator of Section XVI, and the alternative heading is outside Section XVI, the tower must be classified in the same heading as the electric generator.

Pursuant to the case you cite, Nidec Corporation v. United States, 861 F. Supp. 136, aff’d, 68 F.3d 1333 (1995), goods that are identifiable as parts of machines or apparatus of Chapter 84 or Chapter 85 are in all cases to be classified in accordance with Section XVI, Note 2, HTSUS. Note 2(a) requires that parts which are goods included in any heading of either Chapter are to be classified in their respective headings. Note 2(b) requires, among other things, that other parts are to be classified with the machines with which they are solely or principally used.

We agree that Section XVI, Note 2 controls the classification here, but we do not agree with the conclusion you reach. Not every article used with another article is necessarily a part of that other article in a tariff sense. Parts, for tariff purposes, are integral, constituent components of another article, necessary to the completion of that article, and which enable that article to function in the manner for which it was designed. We understand and accept that structurally, an individual tower and its turbine generator must be a mated pair, with each tower specially manufactured according to the size, weight and other specifications of the turbine generator. Nevertheless, the towers are not working parts of the turbine generator and provide no operational or mechanical interaction with it. A combination turbine and electric generator is a complete, fully functional article of commerce in and of itself, and does not rely on a tower for its completeness or operational readiness. The towers do not qualify as parts under any recognized principle of tariff classification.

Insofar as EN 85.02, states that the “expression ‘generating sets’ applies to the combination of an electric generator and any prime mover other than an electric motor (e.g., hydraulic turbines, steam turbines, wind engines, reciprocating steam engines . . .),” there is no indication that this description affirmatively includes an external structure classifiable elsewhere in the HTSUS, and imported separately.

The description of electric generating sets, in EN 85.02(I), provides that, “generating sets” consist of the generator and its prime mover which are mounted (or designed to be mounted) together as one unit or on a common base (see the General Explanatory Note to Section XVI). These goods are classified in chapter 85 provided they are presented together (even if packed separately for convenience of transport). The EN does not state that such a “common base” must be, or even, should be included. Further, the ENs do not provide that such a common base is, or should be regarded as, “a part.” Insofar as, only a wind engine and its prime mover presented together, would be considered a “generating set,” the subject merchandise, imported separately from the electric turbine, and absent any evidence of the presence of how a steel tower may be considered a “prime mover,” is not classifiable under heading 8503, HTSUS, as a “part” of a generating set in heading 8502, HTSUS.

Significantly, EN 73.08, states that the heading covers “complete or incomplete metal structures, as well as parts of structures. Moreover, for the purpose of the heading, the EN states that the “structures are characterised by the fact that once they are put in position, they generally remain in that position[,]” and that such structures “are usually made up from bars, rods, tubes, angles, shapes, sections, sheets, plates, . . . and parts of structures include clamps and other devices specially designed for assembling metal structural elements of round cross-section (tubular or other).” The ENs also notes that, the heading also includes products such as: [p]it head frames and superstructures; adjustable or telescopic props, tubular props, extensible coffering beams, tubular scaffolding and similar equipment; . . .[and] masts, . . ..” The steel towers meet all of these criteria. Thus, the towers must be treated in a manner similar to the merchandise in HQ 962476, in its condition as entered.

Customs has classified similar goods in the past. It is relevant to note Customs determination in HQ 082655, dated July 17, 1989, where Customs held that a lattice tower constructed from 19 and 38 foot long welded steel lattice towers and supported a crane structure was classifiable under heading 7308, HTSUS. In HQ 084140, dated July 18, 1989, Customs determined that a “pit liner pedestal,” which served as a platform-like top upon which a generator and the rotating parts of its turbine, were placed, was also classifiable in subheading 7308, HTSUS, as a metal structure. In the latter decision, Customs specifically held that the pit liner pedestal and a walkway were neither considered parts classifiable in chapters 84 or 85, nor were they classifiable elsewhere in section XVI, HTSUS.

The towers must be classified as they existed upon entry, in consideration of their construction, function and use, and not on the basis of an intended purpose.

We find that the merchandise may be classified at GRI 1, because it is prima facie, and specifically classifiable at heading 7308, HTSUS, an eo nomine provision, and is not a “part” under Section XVI or under heading 8503, HTSUS, as a part of such equipment, or goods or parts of goods of another heading in chapter 84 or 85, HTSUS.

Accordingly, NY E82319 must be revoked.

HOLDING:

The steel tower is classifiable at GRI 1, in subheading 7308.20.00, HTSUS, as:. a, “[s]tructure (excluding prefabricated buildings of heading 9406) and parts of structures (for example, bridges and bridge sections, lock gates, towers, lattice masts, roofs, roofing frameworks, doors and windows and their frames and thresholds for doors, shutters, balustrades, pillars and columns) of iron or steel; plates, rods, angles, shapes, sections, tubes and the like, prepared for use in structures, of iron or steel: Towers and lattice masts[.]”

EFFECT ON OTHER RULINGS:

NY E82319, dated June 3, 1999, is revoked. In accordance with 19 U.S.C. 1625(c) this ruling will become effective 60 days after its publication in the Customs Bulletin.

Sincerely,

John Durant, Director
Commercial Rulings Division

Previous Ruling Next Ruling

See also: