Glass Content Capped at 50 Percent for Classification as Machinery Parts, Says CIT
Products containing glass must be mostly made of other materials, or include mechanical components, to be classified as machinery under chapter 84, said the Court of International Trade in a July 10 decision (here). Although the note excluding articles of glass from classification in chapter 84 is silent as to what “of glass” means, CIT looked to the history of the World Customs Organization’s Harmonized System tariff schedule to find the international body intended it to mean products that are not “mainly of other materials.”
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At issue in the case are glass bulbs imported from Germany by Tyco Fire Products for use as parts in fire sprinkler systems and water heaters. The bulbs are filled with a liquid that expands and breaks the bulb when heated. In the sprinkler systems, the bulb holds closed a valve; in the case of a fire, the heat breaks the bulb, allowing the valve to open and water to flow. In the water heaters, the bulb holds open a door supplying air to the combustion chamber; when it gets too hot, the bulb explodes, allowing the door to close and preventing an explosion. CBP classified the bulbs as articles of glass under heading 7020. Tyco filed suit, arguing they should have been classified as parts of machinery under chapter 84.
U.S. Note 1(c) to chapter 84 excludes “articles for technical uses or parts thereof, of glass (heading 7019 or 7020).” As explained by the WCO’s explanatory notes to chapter 84, an item “ceases to be ‘of glass’ when it is combined with a ‘high proportion of other materials or when static components of glass are combined with ‘mechanical components’ of other materials, such as a motor or pump,” said CIT. Tyco argued the bulbs’ liquid content, 16 to 31 percent by weight depending on the bulb, constitutes a “high proportion” of other materials, and the bulbs are not articles “of glass” excluded by Note 1(c).
Examining the circumstances under which the WCO drafted the relevant explanatory notes, CIT ruled that a “high proportion” means a majority for the purposes of Note 1(c). In 1970, while considering how to interpret “of glass” in chapter 84, the WCO looked for guidance to another explanatory note on chapter 90.25, which says “instruments normally cease to have the essential character of glassware when they consist partly of glass but are mainly of other materials.” Although the WCO eventually adopted the “high proportion language,” it “intended to apply a criterion for excluding glassware from chapter 84 similar to that contained” in chapter 90.
With only 16 to 31 percent liquid content, and the rest glass, CIT found that Tyco’s bulbs are not “mainly of other materials,” and are therefore articles “of glass” excluded from classification under chapter 84. Nor are the bulbs mechanical, because the shattering of a bulb similar to machinery. Finally, the court held that Tyco’s bulbs have the essential character of glass, rather than liquid, and are classifiable under heading 7020.
(Tyco Fire Products L.P., Slip Op. 15-74, CIT # 08-00190, dated 07/10/15, Judge Restani)
(Attorneys: Michael Roll of Pisani & Roll for plaintiff Tyco Fire Products; Amy Rubin for defendant U.S. government)