Tube Mills Classified as 'Machine Tools' Despite Use of Rollers, CBP Says
A direct forming hollow section line or “tube mill" is correctly classified under Harmonized Tariff Schedule of the U.S. heading 8462 as a machine tool rather than under heading 8455 as a metal-rolling mill, according to a recently released CBP ruling. The ruling came in response to an application for further review of a denied protest filed by Dundee Products.
CBP described the tube mill as consisting of a series of connected components that form strip steel into a square or rectangular tube. The tube mill uses a series of rollers to crease and fold steel into the desired shape. Each set of rollers in the mill is angled to bend the strip incrementally.
The full machine is 300 feet long, and comprises a strip uncoiler and accumulator, a direct flexible cold forming line, a tube welding section, an FCF tube sizing section, a cut off, a finishing line, and integrated control electronics. Although the tube mill was incomplete and disassembled at the time of importation, CBP said that it retained the essential characteristics of a finished tube mill and was therefore classified as a completed machine.
CBP initially liquidated the tube mill under subheading 8462.21.00 as “Machine tools (including presses) for working metal by forging, hammering or die-stamping; machine tools (including presses) for working metal by bending, folding, straightening, flattening, shearing, punching or notching; presses for working metal or metal carbides, not specified above: Bending, folding, straightening or flattening machines (including presses): Numerically controlled," dutiable at 4.4% along with an additional 25% Section 301 tariff as a product of China.
Dundee argued that the tube mill is a “roll forming” machine rather than a bending machine as understood by the steel industry, and that heading 8455 refers to machines used by tube producers and heading 8462 covers only machines used by tube fabricators.
CBP said that those points were "semantic distinctions," which did not overcome the legal text of headings 8455 and 8462. CBP noted that the courts have ruled industry definitions are determinative "only when the textual language of the HTSUS is unclear," which the agency said wasn't the case here.
On the issue of the rollers, CBP noted that while rollers are used in the reshaping procedure, they are used for a different purpose than the "rolling machines" of heading 8455. While rollers are used to work the metal and form tubes, "the mere presence of rollers does not necessitate classification as a 'rolling machine' of heading 8455," CBP said. The explanatory note to heading 8455 distinguishes between rolling machines of 8455 and machines that may happen to be outfitted with rollers but are classified elsewhere. Rolling machines of 8455 are used to improve the grain structure and quality of the metal. Therefore, the purpose of the tube mill becomes relevant to our analysis, CBP said, not merely how the mill operates and that there are rollers present.
Dundee also argued that the tube mill can't be classified in heading 8462 because it doesn't operate by "bending, folding, straightening or flattening the strip metal." While the machine uses rollers to bend and fold metal, it "undeniably is used to work the metal and bend it into the desired shape," CBP said. Regardless of whether the tube mill forms or bends metal into tubes, CBP said that it couldn't ignore that the tube mill works the metal and reshapes it, a process that "is easily distinguishable from rolling to improve grain structure and quality," CBP said.