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HQ 082090

June 10, 1988

CLA-2:CO:R:C:G 082090 JAS


TARIFF NO.: 7308.90.90

Mr. James R. Allen
Research Products Company
P.O. Box 1460
Salina, Kansas 67402-1460

RE: Prefabricated grain storage units

Dear Mr. Allen:

In your letter of February 19, 1988, you inquire as to the tariff classification of prefabricated grain storage units from Brazil. You forwarded more detailed information on April 29, 1988.

Submitted literature describes the AGRAPORT self- supporting warehouse. It is advertised as a grain storage warehouse and as a bulk storage facility which costs less to build and operate than conventional flat bulk storage units of the same capacity.

The AGRAPORT is a quonset-style structure consisting of a semicircular arched roof of self-supporting corrugated steel panels, joined side by side into rigid arches with a maximum width of 121 ft. 3 in. Large sliding doors provide access. The AGRAPORT can rest on a concrete slab (not a part of the importation) or on compacted earth with only concrete consoles at each end in which anchor plates are set. It has louvered end panels for ventilation, fiberglass panels for illumina- tion, and steel beam structures at each end to support the end panels.

Inloading and outloading are accomplished by overhead and underground conveyors. As probes with thermocouples suspended from the ceiling sense hot spots on the floor, the end panels are opened or closed either by computer or manually by the warehouse operator. When completed, the AGRAPORT has a grain capacity of 10,000-20,000 metric tons (365,000-730,000 bushels). You indicate these units will be marketed to U.S. grain handlers.

Bulk storage facilities such as the AGRAPORT are classifiable under the provision for other structures and parts of structures, of base metal, in item 653.00, Tariff Schedules of the United States (TSUS), dutiable at the rate of 5.7 percent ad valorem.

Item 870.40, TSUS, is a duty-free provision covering machinery, equipment, and implements to be used for agricul- tural or horticultural purposes. Structures ordinarily classifiable in item 653.00, TSUS, would be eligible for duty- free entry under item 870.40, TSUS, provided they are actually used by a farmer on a farm, and relate directly to the production or preservation of an agricultural product, or as shelters for farm animals.

Item 870.40 does not apply, for example, to structures such as tool shops or vehicle maintenance buildings which may be used on the farm but have no direct relationship to the production of food or the raising of animals. Item 870.40 also does not apply to articles used by a co-op or similar non-farm user.

Item 870.40, TSUS, would apply to the AGRAPORT bulk storage facility only if satisfactory evidence is given that it is actually used in the manner indicated. In the absence of such actual use evidence, the AGRAPORT would be classifi- able in item 653.00, TSUS. Copies of our actual use regulations are enclosed for your reference.

The Harmonized Tariff Schedule of the United States Annotated (HTSUSA), is scheduled to replace the TSUS as the tariff code of the United States. The HTSUSA provision for the AGRAPORT bulk storage facility is 7308.90.90, Structures and parts of structures of iron or steel, other. The HTSUSA equivalent of item 870.40, TSUS, is 9817.00.50, Machinery, equipment and implements to be used for agricultural or horticultural purposes. The same actual use requirements apply. However, certain administrative errors in the current HTSUSA make Subheading 9817.00.50 inapplicable to the AGRAPORT. Customs has brought these errors to the attention of the responsible agency and we expect them to be corrected before the next HTSUSA supplement is issued in the Fall.

This represents the present position of the Customs Service on the classification of this merchandise. However, if there are changes in these provisions prior to enactment of the HTSUSA, this advice may not continue to apply.


John Durant, Director,

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