HQ 089935
November 6, 1991
CLA-2 CO:R:C:M 089935 KCC
CATEGORY: Classification
TARIFF NO.: 8454.30.00
Mr. Karl H. Quast
Quast & Co. Inc.
332 South Michigan Avenue
Chicago, Illinois 60604
RE: Thin Strip Casting Machine; casting unit; cooling
section; shear; coiler; composite machine; Note 3,
Section XVI; General EN 3, Section XVI; 087740; 086736;
functional unit; Note 4, Section XVI
Dear Mr. Quast:
This is in response to your letter dated July 18, 1991,
concerning the tariff classification under the Harmonized Tariff
Schedule of the United States Annotated (HTSUSA), of a thin strip
casting machine.
FACTS:
The thin strip casting machine is a continuous caster which
consists of a casting unit, a cooling section, a shear and a
coiler. The continuous caster produces a thin strip or sheet
with a thickness ranging from 1 - 3 mm. This process does not
use hot or cold rolling mill equipment.
You state that the thin strip casting machine will be
imported into the U.S. in one shipment, dissembled. You maintain
that the components are to be regarded as a composite machine for
tariff purposes pursuant to Note 3, Section XVI, HTSUSA. You
conclude that the proper tariff classification is under
subheading 8454.30.0090, HTSUSA, which provides for other casting
machines of a kind used in metallurgy or in metal foundries.
ISSUE:
What is the proper tariff classification of the thin strip
casting machine under the HTSUSA?
LAW AND ANALYSIS:
The classification of merchandise under the HTSUSA is
governed by the General Rules of Interpretation (GRI's). GRI 1,
HTSUSA, 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...."
For purposes of Note 3, Section XVI, HTSUSA, a composite
machine consists of two or more machines or appliances of
different kinds, fitted together to form a whole, consecutively
or simultaneously performing separate functions which are
generally complementary and are described in different headings
of section XVI. A composite machine is classified according to
its principal function.
General Explanatory Note (EN) 3 to Section XVI of the
Harmonized Commodity and Description Coding System (HCDCS),
states that for the purposes of [the provisions relating to
composite machines and multi-function machines], machines of
different kinds are taken to be fitted together to form a whole
when (1) incorporated one in the other or (2) mounted one on the
other, or (3) mounted on a common base or frame or in a common
housing (emphasis original). Additionally, General EN 3 to
Section XVI states that floors, concrete bases, walls,
partitions, ceilings, etc., even if specially fitted out to
accommodate machines or appliances, should not be regarded as a
common base joining such machines or appliances to form a whole.
HCDCS, Vol. 3, p. 1133. The Explanatory Notes, although not
dispositive, are to be looked to for the proper interpretation
of the HTSUSA. 54 Fed. Reg. 35127, 35128 (August 23, 1989).
We have held in Headquarters Ruling Letter (HRL) 087740
dated August 20, 1990, that a continuous casting plant
consisting of a tundish/caster, shears, reduction group, edge
trimmer, coilers, conveyor, hydraulics, programmable controlling
apparatus and steel framework constituted a composite machine and
was classifiable under subheading 8454.30.0090, HTSUSA. However,
the submitted data in this case does not show that the described
components are to be fitted together to form a whole within the
meaning of the ENs. These components, therefore, are not
classifiable as a composite machine for tariff purposes.
However, we have previously held in Headquarters Ruling
Letter (HRL) 086736 dated June 7, 1990, that a tundish/melter and
block caster with integral cooling unit constitutes a functional
unit pursuant to Note 4, Section XVI, HTSUSA, which is
classifiable as a casting machine under subheading 8454.30.0090,
HTSUSA. In accordance with Note 4, Section XVI, HTSUSA,
combinations of machines consisting of individual components,
whether separate or interconnected, intended to contribute
together to a clearly defined function covered by one of the
headings in chapter 84 or chapter 85, are to be classified in the
heading appropriate to that function. There is no single heading
either in chapter 84 or chapter 85 which covers the combination
of caster, cooler, shear and coiler (thin strip casting machine)
under consideration.
In this case, the thin strip casting machine consists of
four components (the caster, cooler, shear, and coiler) which are
designed to function together to create a thin strip or sheet of
metal. As the four components function together to create the
thin strip casting machine, we are of the opinion that they
constitute a functional unit pursuant to Note 4, Section XVI,
HTSUSA, classifiable under subheading 8454.30.0090, HTSUSA, which
provides for "Converters, ladles, ingot molds and casting
machines, of a kind used in metallurgy or in metal foundries, and
parts thereof...Casting machines...Die casting machines."
HOLDING:
The thin strip casting machine constitutes a functional unit
pursuant to section XVI, Note 4, HTSUSA, which is classifiable
under subheading 8454.30.00, HTSUSA, as "...casting machines, of
a kind used in metallurgy or in metal foundries, and parts
thereof...Casting machines...Die casting machines."
Sincerely,
John Durant, Director
Commercial Rulings Division