Application for further review of protest number 3901-10-100286; Classification of a chassis used in automatic paper towel dispensers

HQ H117030 March 21, 2011 CLA-2:OT:RR:CTF:TCM H117030 JRB CATEGORY: Classification Tariff No.: 8479.89.65 Port Director Port of Chicago 9915 Bryn Mawr Rosemont, Illinois 60018 Attn: Jason Bucatch, Senior Import Specialist RE: Application for further review of protest number 3901-10-100286; Classification of a chassis used in automatic paper towel dispensers Dear Port Director: This letter is our decision on protest and Application for Further Review (AFR) number 3901-10-100286, filed by a licensed customs broker on behalf of New Product Innovations, Inc. (protestant). The protest is against U.S. Customs and Border Protection’s (CBP) classification of an electronic feed chassis used in automatic paper towel dispensers, under the Harmonized Tariff Schedule of the United States (HTSUS). FACTS: The subject merchandise was entered through the Port of Chicago on December 8, 2009 under subheading 8479.90.9496 of the Harmonized Tariff Schedule of the United States Annotated (HTSUSA), which provides for “[m]achines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: [p]arts: [o]ther… [o]ther: [o]ther…”. On December 21, 2009 your port issued a Notice of Action (CBP Form 29) advising the protestant that you were rate advancing the entry and that the appropriate subheading for the merchandise is subheading 8479.89.65, HTSUS, which provides for “[m]achines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: [o]ther machines and mechanical appliances: [o]ther: [e]lectromechanical appliances with self-contained electric motor: [o]ther…”. The entry then liquidated on February 26, 2010 and the instant protest was filed on March 26, 2010. The instant merchandise is an electronic feed chassis that is used in automatic paper towel dispensers. It is a battery operated unit that consists of one roller and a small electric motor with a gear drive that feeds paper towels when the infrared sensor on the imported unit is activated. A picture of the chassis and the complete paper towel dispenser are pictured below. A picture of the merchandise in its imported condition:
 A picture of the completed paper towel dispenser:
ISSUE: Whether the electronic feed chassis is classified as an other machine and mechanical appliance in subheading 8479.89, HTSUS, or as a part of a machine in subheading 8479.90, HTSUS? LAW AND ANALYSIS: Initially, we note that this matter is protestable as a classification decision pursuant to 19 U.S.C. §1514(a)(2). The protest was timely filed on March 26, 2010, within 180 days of the liquidation of the first entry giving rise to the protest. See Miscellaneous Trade and Technical Corrections Act of 2004, Pub.L. 108-429, §2103(2)(B) (codified as amended at 19 U.S.C. §1514(c)(3) (2006)). In addition further review of Protest 3901-10-100286 was properly accorded because the protestant has alleged new facts or legal arguments which were not considered in a previously issued ruling letter. See 19 C.F.R. §174.24(c). 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 2 through 6 may then be applied in order. GRI 6 requires that the classification of goods in the subheadings of headings shall be determined according to the terms of those subheadings, and any related subheading notes, and mutatis mutandis to the GRIs 1 through 5. The 2009 HTSUS subheadings under consideration are: 8479 Machines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: Other machines and mechanical appliances: 8479.89 Other: 8479.90 Parts: There is no dispute that the merchandise is classified in heading 8479, HTSUS, as a machine or mechanical appliance having an individual function not specified or included elsewhere in Chapter 84, HTSUS. The only issue is at the subheading level. GRI 6 provides: For legal purposes, the classification of goods in the subheadings of a heading shall be determined according to the terms of those subheadings and any related subheading notes and, mutatis mutandis, to the above rules, on the understanding that only subheadings at the same level are comparable. For the purposes of this rule, the relative section, chapter and subchapter notes also apply, unless the context otherwise requires. The protestant argues that the chassis is different than the complete automatic paper towel dispenser making it distinguishable from New York Ruling Letter (NY) H86562, dated January 10, 2002. CBP agrees with the protestant that the chassis and the completed automatic paper towel dispenser are in fact different products. However, the chassis, despite being imported alone, is still a machine and thus must be classified as such and cannot be considered a part of the automatic paper towel dispenser because of GRI 6 and Note 2(a) to Section XVI, HTSUS. Note 2 to Section XVI (the section in which heading 8479 is located), HTSUS, provides in relevant part: Subject to note 1 to this section, note 1 to chapter 84 and to note 1 to Chapter 85, parts of machines (not being parts of the articles of heading 8484, 8544, 8545, 8546, or 8547) are to be classified according to the following rules: (a) Parts which are goods included in any of the headings of chapter 84 or 85 (other than headings 8409, 8431, 8448, 8466, 8473, 8487, 8503, 8522, 8529, 8538 and 8548) are to be classified in their respective headings… Note 2(a) to Section XVI, HTSUS, provides that parts which are goods that are described by any specific heading should be classified in the specific heading and not as a part. Applying this rule at the subheading level, it would read that a good that is described as a good of a subheading would be classified in that subheading and not as a part in subheading providing for parts. In this case, the subject merchandise features the motor, rollers, sensor and gear drive necessary to turn and dispense paper towels. The plastic housing into which the chassis is installed after importation only holds the roll of paper towels and protects the roll from being torn, etc. Accordingly, we find that the chassis, as imported, is a machine of subheading 8479.89, HTSUS, which provides for other machines and mechanical appliances, since no other subheading of heading 8479, HTSUS, describes the machine. HOLDING: By application of GRI 1, the electronic feed chassis is classified under heading 8479, HTSUS. In accordance with, GRIs 1 and 6 (Note 2 to Section XVI, HTSUS) the chassis is classified in subheading 8479.89.65, HTSUS, which provides for “[m]achines and mechanical appliances having individual functions, not specified or included elsewhere in this chapter; parts thereof: [o]ther machines and mechanical appliances: [o]ther: [e]lectromechanical appliances with self-contained electric motor: [o]ther…”. The 2009 column one, general rate of duty, is 2.8%, ad valorem. You are instructed to DENY the protest in full. In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision, together with the CBP 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 International Trade, Regulations and Rulings, will make the decision available to CBP personnel, and to the public on the CBP 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 and Trade Facilitation Division