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HQ 966621




February 18, 2004

CLA-2 RR:CR:GC 966621 DBS

CATEGORY: CLASSIFICATION

TARIFF NO.: 8465.93.00

Port Director
U.S. Customs and Border Protection
610 S. Canal Street, Room 306
Chicago, IL 60607

RE: Protest #3901-03-101004; LOH V-Pro lens generator; machine tool

Dear Port Director:

This is our decision on Protest 3901-03-101004 filed against your classification under the Harmonized Tariff Schedule of the United States (HTSUS), of a lens generator that machines plastic, glass, aluminum and other materials. The entries were liquidated on March 7, 2003, and the protest was timely filed on June 5, 2003.

FACTS:

The merchandise at issue is the LOH V-Pro lens generator ("V-Pro generator), imported by LOH Optical Machinery, Inc. ("LOH"). The operation manual for the LOH V-Pro states that it is a grinding/milling machine used primarily for machining ophthalmic lenses and for making tools for grinding and polishing. The machine has interchangeable cutting tools with varying diamond pads, shapes and positions of the cutting edge for the various materials it processes. These materials are CR-39 resin (a plastic), polycarbonate, high index materials, mineral glass, other ophthalmic materials, aluminum tools, plastic tools and ceramics.

The V-Pro generator has a single workstation. It performs multiple operations of generating and turning with a single cutting tool. The V-Pro combines high-speed disc cutting and single point lens turning. An engineer for LOH described to a Customs National Import Specialist that the cutting wheel for working plastic has eight (8) generating bits and four (4) turning bits. During the lens generating process the cutting wheel and the lens blank (also referred to as a workpiece) both rotate so that the generating bits can cut away at the material. The individual bits do not rotate. During the turning process, only the workpiece rotates while the turning bits are fed into it to remove material similarly to a lathe. (A lathe is a machine for shaping a piece of material, such as wood or metal, by rotating it rapidly along its axis while pressing against a fixed cutting or abrading tool. Dictionary.com, http://dictionary.reference.com/search?q=lathe.). When the operator manually switches to working glass, he removes this wheel and replaces it with a wheel coated with diamond bond material. The descriptive literature states that the machining leaves the lenses with a ready-to-polish surface.

Additional information provided by counsel for the protestant on February 6, 2004 explains that the V-Pro generator performs milling, lathing or grinding functions of semi-finished blanks. The grinding process is used on glass, plastic, polycarbonate and other high index materials using special galvanic wheels. However, the generator cannot mill or lathe glass (as it does plastic).

You classified the V-Pro generator in subheading 8465.93.00, HTSUS, which provides, in relevant part, for machine tools for grinding, sanding and polishing hard plastic. The protestant claims the generator is classified in subheading 8464.20.50, HTSUS, which provides, in part, for machine tools for grinding glass.

ISSUE:

Whether the LOH V-Pro lens generator is classified as a machine tool for working glass under heading 8464, HTSUS, or as a machine tool for working plastic under heading 8465, HTSUS.

LAW AND ANALYSIS:

Classification under the HTSUS is made in accordance with the General Rules of Interpretation (GRIs). GRI 1 provides that the classification of goods shall be determined according to the terms of the headings of the tariff schedule and any relative Section or Chapter Notes. In the event that the goods cannot be classified solely on the basis of GRI 1, and if the headings and legal notes do not otherwise require, the remaining GRIs may then be applied.

In understanding the language of the HTSUS, the Harmonized Commodity Description and Coding System Explanatory Notes (ENs) may be utilized. ENs, though not dispositive or legally binding, provide commentary on the scope of each heading of the HTSUS, and are the official interpretation of the Harmonized System at the international level. Customs believes the ENs should always be consulted. See T.D. 89-80, 54 Fed. Reg. 35127, 35128 (August 23, 1989).

The HTSUS provisions under consideration are as follows:

8464 Machine tools for working stone, ceramics, concrete, asbestos-cement or like mineral materials or for cold working glass:

8464.20 Grinding or polishing machines:

8464.20.50 Other

8465 Machine tools (including machines for nailing, stapling, glueing or otherwise assembling) for working wood, cork, bone, hard rubber, hard plastics or similar hard materials:

8465.10.00 Machines which can carry out different types of machining operations without tool change between operations.

Other:

8465.92.00 Planing, milling or molding (by cutting) machines

8465.93.00 Grinding, sanding or polishing machines

Counsel for the protestant argues that the V-Pro generator is more specifically provided for in heading 8464, HTSUS, than in heading 8465, HTSUS, according to the relative specificity requirement of GRI 3(a). Counsel also argues that the machine was originally designed and used for cutting glass, and thus that working glass remains its principal use.

As stated above, we must first apply GRI 1. Only if we determine that a good cannot be classified solely on the basis of GRI 1 do we apply the remaining GRIs. See Informed Compliance Publication of the United States Customs Service," What Every Member of the Trade Community Should Know About Tariff Classification" (February 2001) ("GRI 1 takes precedence over the remaining rules")). Therefore, counsel's arguments regarding GRI 3(a) and relative specificity are premature.

The V-Pro generator grinds and mills various materials and tools with interchangeable wheels. Applying GRI 1, we turn first to Section XVI, Note 3, which provides:

Unless the context otherwise requires, composite machines consisting of two or more machines fitted together to form a whole and other machines designed for the purpose of performing two or more complementary or alternative functions are to be classified as if consisting only of that component or as being that machine which performs the principal function.

Section XVI, Note 5, HTSUS, provides that, for the purposes of the section notes, the term machine means any machine, machinery, apparatus and the like cited in Chapters 84 and 85, HTSUS. Therefore, we may substitute the term machine tool for machine for the purpose of Note 3.

The General EN (VI) to Section XVI, HTSUS, which explains the scope of Note 3, provides, in pertinent part, as follows:

Multi-function machines are, for example, machine-tools for working metal using interchangeable tools, which enable them to carry out different machining operations (e.g., milling, boring, lapping).

It should be noted that multi-purpose machines (e.g., machine tools capable of working metals and other materials) are to be classified according to the provisions of Note 7 to Chapter 84.

Note 7 to Chapter 84, HTSUS, provides, in part, that "[a] machine which is used for more than one purpose is, for the purposes of classification, to be treated as if its principal purpose were its sole purpose." Regarding machines governed by Note 7, General EN (D) to Chapter 84 states, in relevant part, that "[m]achines which fall in two or more headings, none of which is within headings 84.01 to 84.24, are classified in that heading which provides the most specific description of the goods, or according to the principal use of the machine."

Heading 8464, HTSUS, provides, in part, for machine tools for cold working glass. EN 84.64 (II) states, in part, that these machine tools may be for specialized work, such as optical or watch-making. They include glass-cutting machines of the wheel or diamond type, among others. This heading also provides for optical finishing and polishing machine tools.

Heading 8465, HTSUS, provides, in relevant part, for machine tools for working hard plastics and similar hard materials. EN 84.65 states that the heading includes machine tools for shaping or surface working hard materials. EN 84.65 (A) describes a variety of tools not normally specialised for a particular industry. Included in the list are:

(3) Machines for moulding and milling, which shape the workpiece using profiled rotating tools which remove chips of material. and
(4) Grinding, sanding and polishing machines. Grinding machines which use grindstones are principally used for hard products such as corozo, hard rubber, horn and ivory. and
(10) Lathes, which are used to fashion a workpiece by a motion about its own axis, the tool not turning.

The V-Pro generator is designed to grind glass lens blanks with a diamond-coated wheel by rotating the wheel and the workpiece, and is specialized for optical use. Therefore, it performs the function of a wheel-type glasscutter that is covered by heading 8464, HTSUS. The generator operates in the same manner to mill and grind plastic and other hard materials but using different tools. The generating and turning functions are performed with the same tool (wheel) but with a change in the operation of the machine (e.g., for turning, only the workpiece rotates). However, the operator must change the tool when changing the material upon which the machine is working. These functions are described in the ENs above for machines that work hard plastic. Thus, it also performs the functions of machines covered by heading 8465, HTSUS.

The instant machine performs alternative machining functions, depending upon the material of the workpiece, with interchangeable tools. As this mirrors the description EN(VI) to Section XVI for a multifunction machine, this machine is governed by Section XVI, Note 3, at GRI 1. However, the machine is capable of working several materials. Based in the description in the ENs, it is also multi-purpose machine. Note 3 to Section XVI, HTSUS, as per General EN (VI) to Section XVI, directs that the classification of such machines is determined according to Note 7 to Chapter 84, HTSUS. General EN (D) to Chapter 84 states that a machine provided for in two or more headings (not 8401 to 8424) is classified according to the most specific description of the goods, or according to the principal use of the machine.

Though the generator is also capable of machining aluminum, plastic and ceramic lap tools, the primary purpose of the generator is to work lenses, and thus the machining of lap tools is auxiliary. In light of the governing legal note, the provisions covering the machine tools for these materials (aluminum, plastic and ceramic lap tools) do not merit consideration for determining the classification of the generator.

Heading 8464 vs. Heading 8465

Neither heading at issue provides a more specific description of the machine tool. Therefore, we must determine the machine's principal use. Under the GRIs, it is the principal use of the class or kind of goods to which the imports belong at or immediately prior to the time of importation and not the principal use of the specific import that is controlling. See Group Italglass U.S.A., Inc. v. United States, 17 C.I.T. 1177, 1177, 839 F. Supp. 866, 867 (1993); see also Additional U.S. Rule of Interpretation 1(a), HTSUS ("ARI 1(a)").

To determine the class or kind to which a good belongs, the courts have provided factors, which are indicative but not conclusive. These factors are set forth in United States v. Carborundum Co., 63 CCPA 98, C.A.D. 1172, 536 F. 2d 373 (1976), cert. denied, 429 U.S. 979 (hereinafter Carborundum). They include the general physical characteristics of the article, the expectation of the ultimate purchaser, channels of trade, environment of sale (accompanying accessories, manner of advertisement and display), use in the same manner as merchandise which defines the class, economic practicality of so using the import, and recognition in the trade of this use.

The general physical characteristics of the V-Pro generator include interchangeable machine tools for grinding glass (sintered tool) or milling plastic (PCD tool) or grinding plastic (galvanic tool). Counsel for the protestant submitted that the V-Pro generator is purchased by central processing laboratories and not on-site lens makers because on-site lens makers generate only plastic lenses. The descriptive literature accompanying the protest demonstrates that the machine is advertised for use on plastic and glass lenses equally. The protestant's patent information also focuses on both grinding glass and milling plastic. See US Patent No. 6,227,952 B1, May 8, 2001. Counsel for the protestant submitted patent information on a competitor's lens generator, which is designed only for generating plastic lenses.

Additional research by this office indicates that several manufacturers' machines are designed solely for generating plastic lenses, though some are multi-purpose. Some lens generating machines that machine only plastics cost significantly less than the instant machine, indicating that it would not be economically practical for an optical laboratory to purchase or use this import solely to make plastic lenses. However, we note that although spectacle lenses were originally glass, the majority of lenses generated currently in the United States are plastic. See, e.g., "How to Make Corrective Lenses," http://science.howstuffworks.com/lens.htm/. That is, plastics have dominated the ophthalmic lens industry for many years, which counsel for the protestant acknowledges. That notwithstanding, counsel argues that because LOH's lens generating machines were originally designed for cutting glass, the principal use remains to be cutting glass.

We disagree. As ARI 1(a) requires that classification is to be determined in accordance with the use in the United States at, or immediately prior to, the date of importation, of goods of that class or kind to which the imported goods belong, principal use can change. The prevalence of plastic materials in the ophthalmic lens industry supports that the principal use of lens generating machines is machining plastic or other high index materials. We are not persuaded by the fact that the ultimate purchaser is the type of laboratory that makes glass lenses because one would not purchase a multi-purpose machine unless it generated a variety of lenses. Therefore, counsel has not proven that this machine does not belong to the class of lens generators which predominantly work plastic, given the ophthalmic lens market in the U.S. Accordingly, the principal use is machining plastics.

Note 7 requires that a machine which is used for more than one purpose be treated as if its principal purpose were its sole purpose. Thus, the instant machine tool falls to be classified in heading 8465, HTSUS, notwithstanding that it is designed and marketed to work glass, as well.

One-dash subheading level

To determine in which subheading the machine falls to be classified, we turn to GRI 6, which permits the comparison of same-level subheadings within a heading, by the terms of the subheading and any subheading notes, as well as the application of Rules 1 through 5, applied by the appropriate substitution of terms, unless the context otherwise requires.

As the GRI's may only be applied to compare same-level provisions, we must first consider the one-dash subheading level. The machine performs two functions, generating and turning, without a tool change. Thus it appears to be covered by the terms of subheading 8465.10, HTSUS, which provides for machine tools that carry out different operations without a tool change. However, the V-Pro generator exceeds the scope of subheading 8465.10, HTSUS, because it requires manual assistance to change the tools to work on different materials, and to switch from milling to grinding.

In the event that merchandise is not found to be classifiable under a specific subheading, it is then classified as "other." The "other," or "basket," provision of a subheading should be used only if there is no tariff category that more specifically covers the merchandise. See Rollerblade, Inc. v. United States, 116 F. Supp. 2d 1247, 1251 (C.I.T. 2000) (citing EM Industries, Inc. v. United States, 999 F. Supp. 1473, 1480 (C.I.T. 1998)); see also GRI 3(a) ("The heading which provides the most specific description shall be preferred to headings providing a more general description."). As this machine is not specifically covered in subheading 8465.10, HTSUS, it falls to be classified under the basket provision at the one-dash subheading level, which is not assigned a six-digit tariff number.

Two-dash subheading level (8-digit):

Turning now to the next subheading level, we find that the instant machine mills plastics and other high index materials, which is provided for in subheading 8465.92.00, HTSUS, and it grinds those materials, which is covered by subheading 8465.93.00, HTSUS. Applying GRI 1, via GRI 6, we again have a multifunction machine governed by Note 3 to Section XVI, HTSUS. However, unlike at the heading level, we need only determine which of the two subheadings imparts the principal function.

The machine is designed to accommodate cutting wheels that perform milling and grinding functions. According to the descriptive literature, the V-Pro generator's machining leaves the material with a ready-to-polish surface. The precision of the machining suggests that both functions are equally important to achieving the end result: a generated plastic/high index lens. Therefore, we cannot determine which function prevails over the other within heading 8465, HTSUS.

General EN (VI) to Section XVI provides that, “[w]here it is not possible to determine the principal function, and where as provided in Note 3 to the Section, the context does not otherwise require, it is necessary to apply General Interpretative Rule 3(c).” GRI 3(c) provides, in relevant part, that goods that cannot be classified otherwise "shall be classified under the heading which occurs last in numerical order among those which equally merit consideration." Applying GRI 3(c), the LOH V-Pro Generator is classified in subheading 8465.93.00, HTSUS, which occurs last in numerical order.

HOLDING:

The LOH V-Pro Generator is classified in subheading 8465.93.00, HTSUS, which provides for "Machine tools (including machines for nailing, stapling, glueing or otherwise assembling) for working wood, cork, bone, hard rubber, hard plastics or similar hard materials: Other: Grinding, sanding or polishing machines."

You are instructed to DENY the protest in full.

In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), 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 in accordance with the decision must be accomplished prior to mailing of the decision.

Sixty days from the date of the decision the Office of Regulations and Rulings will make the decision available to CBP personnel, and to the public on the Bureau of Customs and Border Protection Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles B. Harmon, Director
Commercial Rulings Division


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