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HQ 964999




FEBRUARY 20, 2002

CLA-2 RR:CR:GC 964999 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: Various

Port Director of Customs
1001 Bishop Street
Honolulu, HI 96813

RE: Protest 3201-01-100002; Machinery for Producing Fiber Building Boards

Dear Port Director:

This is our decision on Protest 3201-01-100002, filed by counsel on behalf of Hawaiian Commercial & Sugar Co., against your classification, under the Harmonized Tariff Schedule of the United States (HTSUS), of machinery, components and articles for producing fiber building boards from sugar cane stalks. The entries were liquidated on October 6, 2000, and this protest timely filed on January 3, 2001. Counsel for the protestant presented additional facts and legal arguments in a memorandum, dated February 11, 2002.

FACTS:

The merchandise at issue constitutes various articles, including machinery and discrete groupings of machines, used in the assembly of two plants for producing fiber building boards from bagasse, the stalks and other residue of processed sugar cane. These building boards are used in furniture and in the construction industry for walls, partitions and the like. The articles were imported in a number of individual shipments over several months, but are covered in three entries, the subject of this protest. The classification of machines and machinery in entries 427-2***162-5 and 427-2***161-7 are not being contested in this protest.

The machines and machinery in entry 427-2***244-2 are at issue here. The bulk of this merchandise was classified at liquidation under a provision of heading 8479, HTSUS, as other machinery and mechanical appliances, while one component was classified in heading 8537, HTSUS, as a board, panel or other
base for electric control or the distribution of electricity. Counsel proposes to classify two of the components under alternative subheadings of heading 8479, and the remaining five components under provisions other than heading 8479 claimed to be more specific.

Briefly, a complete fiberboard production plant processes bagasse in the following manner. The bagasse is first chopped or granulated, then moved by conveyor to a hopper where it is weighed, mixed with polyurethane binder resin, and spread onto a metal plate called a caul plate, typically 12 feet long and between 6 and 8 feet wide. When dried, this mixture is pre-pressed, collated in the in-feed stacker, then steam heated in hydraulic presses under pressure into boards. The fiber boards are saw-trimmed on all four edges to final dimensions, sanded, then packaged for shipment.

The machinery in entry 427-2***244-2 consists of the following machines or machinery, which we will discuss individually: (1) a hammer mill, erroneously referred to as a chopping system, located outside the plant parameters which is said to crush or grind the bagasse and, through separate apparatus not under protest here, blows it through ducts into (2) bulk storage hoppers located in the plant; (3) tower frame and access platforms of iron or steel, used as framing and support for the various machines and machinery for fiberboard production, and to permit worker access; (4) batch weighing hoppers with load cells for weighing the bagasse particles so as to determine the amount of binder resin to be added; (5) two resinator/blenders with water sprayer, systems which function to mix resin and bagasse; (6) machinery for “laying” the bagasse/resin mixture onto the metal caul plates, and finally (7) iron or steel components of air-conditioned operator’s cabins, process controllers, connecting cables but excluding power distribution cables.

The HTSUS provisions under consideration are as follows:

7308 Structures and parts of structures, of iron or steel

Reservoirs, tanks, vats and other containersof iron or steel, of a capacity exceeding 300 litersbut not fitted with mechanical or thermal equipment

8423 Weighing machinery

8424 Mechanical appliances for projecting, dispersing or spraying liquids or powders

Other lifting, handling, loading or unloading machinery

Other machines and mechanical appliances having individual functions

Boards, panels and other basesfor electric control or the distribution of electricity

ISSUE:

Whether goods described in groupings (1) through (7) are classified as liquidated or as claimed.

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 2(a) states in part that incomplete or unfinished articles are to be classified as if complete or finished provided they have the essential character of the complete or finished article.

The submitted materials indicate that most of the goods described in groupings (1) through (7) were imported incomplete or unfinished, with varying numbers of components necessary for their completion imported in other shipments covered by the entries not being contested in this protest. For purposes of analysis, however, we will regard each grouping of machines as complete or finished.

Grouping (1), the hammer mill, was classified in liquidation under subheading 8479.89.97, HTSUS, as other machines and mechanical appliances having individual functions, not specified or included elsewhere in [chapter 84]. Counsel maintains that subheading 8479.82.00, mechanical appliances for crushing, grindingemulsifying or stirring represents the correct classification. Counsel abandons the original claim as a composite machine under Section XVI, Note 3, HTSUS, and states that the hammer mill is one machine whose principal function is to “crush” the bagasse. The cited authority is NY 869355, dated December 17, 1991, regarding the classification of tire recycling machines and NY 810386, dated June 6, 1995, regarding the classification of a waste reduction mill. Both rulings classified the machines in subheading 8479.82.00 on the basis that combinations of knives and “wearbars” in the first ruling and knives and “counterblades” in the second ruling both produced a “grinding” action. In this protest, the record does not describe the process by which the hammer mill reduces bagasse to fiber particles. The only evidence of record is the pro forma invoice which describes a “’chopping’ and ‘milling’” system, terms which counsel now concedes are inaccurate. While the term “milling” has often been associated with grinding, the term “chopping”
does not appear in the text of subheading 8479.82.00, HTSUS. As the record does not clearly indicate whether the hammer mill performs in a manner similar to the machines in the two cited rulings, classification under subheading 8479.82.00, HTSUS, is not properly documented.

Grouping (2) consists of iron or steel bulk storage hoppers of 380 ft3 capacity, with inlet cyclone and rotary valve. Also in this grouping are handrails, ladders, fan, and screw conveyor. They were classified in liquidation under subheading 8479.89.97, HTSUS. Counsel claims that subheading 8479.90.95, HTSUS, parts of machines of heading 8479, applies. The storage hoppers are said to be parts of the hammer mill of grouping (1). Alternatively, the claim is under subheading 7309.00.00, HTSUS, as reservoirs, tanks, vats and similar containers, of any material, exceeding 300 litersnot fitted with mechanical or thermal equipment. As the storage hoppers appear merely to receive the processed bagasse from the hammer mill, and are not integral to the actual function the mill performs, they do not qualify as “parts” under any recognized principal of tariff classification. Certainly, if the hammer mill were to be a composite machine, Section XVI, Note 3, HTSUS, does not provide for parts of composite machines. The alternative claim under heading 7309 is without merit as grouping (2) includes cyclones and a screw conveyor. The 7309 heading text expressly excludes such mechanical components.

Grouping (3) consists of tower frame and access platforms with handrails, ladders and steps. These are not machinery but structural materials and components. They were classified in liquidation under subheading 8479.89.97, HTSUS. The claim is under subheading 7308.90.95, HTSUS, as other structures and parts of structures, of iron or steel. We agree that the components of grouping (3) do not qualify as machines and mechanical appliances of heading 8479. Moreover, substantially similar stairways, ladders and platforms of iron or steel have been classified in subheading 7308.90.95, HTSUS. See HQ 956922, dated November 21, 1994, and NY F84570, dated April 14, 2000.

Grouping (4) consists of two batch weighing hoppers suspended on photocells. Their function is to weigh the amount of bagasse to determine how much binder resin is required for a proper blend. The hoppers were classified in liquidation under subheading 8479.89.97, HTSUS. Counsel claims this merchandise constitutes weighing machinery classifiable in subheading 8423.30.00, HTSUS. We agree. Bagging scales that weigh out the precise amount of material to be packaged are classifiable in subheading 8423.30.00, HTSUS. See NY 864565, dated July 19, 1991, and NY 810729, dated June 14, 1995.

Grouping (5), constitutes two resonators or blenders with a water and resin spraying function, designed to mix the bagasse with resin. They were classified in liquidation in subheading 8479.89.97, HTSUS. Counsel maintains that subheading 8424.89.70, HTSUS, mechanical appliances for spraying liquids or powders, is the appropriate classification. While this unit is essentially a mixer, no heading describes mixing machines of this type. But, the available information suggests that the actual mixing is accomplished by spraying water/resin into the bagasse. On this basis, we agree that heading 8424 best describes the function of the machinery of grouping (5).

Grouping (6) consists of two “formers” or mat layers and material recovery systems. They were classified in liquidation under subheading 8479.89.97, HTSUS. Counsel now clarifies that no actual forming of loose fibers into mats of particular density or thickness occurs. Rather, this merchandise “loads” the resin/bagasse mix onto the caul plates. It therefore qualifies as loading or material handling machinery described in subheading 8428.90.00, HTSUS. Counsel cites NY B86855, dated July 8, 1997, as support for this classification. However, that ruling, among other things, classified a machine for lifting and stacking products onto a pallet in heading 8428. As there is no indication that the machinery of grouping (6) bears any demonstrated similarity to machines that lift and stack, the cited ruling does not apply, and the claim under heading 8428 is undocumented.

Finally, grouping (7) consists of iron or steel structural components for air conditioned operators’ cabins (presumably without the air conditioning components), electrical controllers, connecting cables, exclusive of power distribution cables. These components were all classified in liquidation under heading 8537, HTSUS, as boards and panels for electric control or the distribution of electricity. Counsel concedes the electrical components were properly classified in heading 8537, but maintains the structural components are akin to those in grouping (3), and that subheading 7308.90.95, HTSUS, is the appropriate classification. We agree that the rulings cited in connection with grouping (3) govern the classification of the structural components in this grouping.

HOLDING:

Under the authority of GRI 1, the merchandise is classifiable as follows:

Grouping (1) is classifiable in subheading 8479.89.97, HTSUS, as liquidated. The protest should be DENIED as to this merchandise;

Grouping (2) is classifiable in subheading 8479.89.97, HTSUS, as liquidated. The protest should be DENIED as to this merchandise;

Grouping (3) is classifiable in subheading 7308.90.95, HTSUS, as claimed. The protest should be ALLOWED as to this merchandise;

Grouping (4) is classifiable in subheading 8423.30.00, HTSUS, as claimed. The protest should be ALLOWED as to this merchandise;

Grouping (5) is classifiable in subheading 8424.89.70, HTSUS. The protest should be ALLOWED as to this merchandise;

Grouping (6) is classifiable in subheading 8479.89.97, HTSUS. The protest should be DENIED as to this merchandise;

The structural components in Grouping (7) are classifiable in subheading 7308.90.95, HTSUS, and the controllers and other electrical components in subheading 8537.10.90, HTSUS. The protest should be ALLOWED as to merchandise classified in the former provision and DENIED as to merchandise classified in the latter provision.

The machines and machinery in entries 427-2***162-5 and 427-2***161-7 are classifiable as liquidated. The protest should be DENIED as to this merchandise.

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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