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HQ 088648

September 4, 1991

CLA-2 CO:R:C:M 088648 DWS


TARIFF NO.: 8504.21.00; 8543.90.80

District Director of Customs
Federal Building, Room 198
N.W. Broadway and Glisan Streets
Portland, OR 97209

RE: Capacitor Voltage Transformer; Protest No. 2904-0-000003

Dear Sir:

This is our decision on Application for Further Review of Protest No. 2904-0-000003, dated January 11, 1990, concerning your action in classifying and assessing duty on capacitor voltage transformers under the Harmonized Tariff Schedule of the United States Annotated (HTSUSA).


The subject merchandise consists of capacitor voltage transformers imported from Switzerland. The transformer is composed of a capacitor voltage divider (CVD) and a transformer unit. The transformer unit includes a transformer, a tuning reactor, and a damping burden for ferroresonance suppression. The inductance of the tuning reactor is adjusted at the factory to resonate with the equivalent capacitance of the capacitor voltage divider at the rated frequency to obtain a correct phase and ratio relationship between the primary voltage and the secondary voltage. The capacitor voltage transformer is used in place of inductive transformers in very high voltage situations for metering, protection relaying and synchronizing, and for power line coupling applications.


What is the proper classification of the capacitor voltage transformer under the HTSUSA?


Classification of merchandise under the HTSUSA is in accordance with the General Rules of Interpretation (GRI's), taken in order. GRI 1 provides that classification is determined according to the terms of the headings and any relative chapter or section notes.

The merchandise was entered under subheading 8504.21.00, HTSUSA, which provides for: "[l]iquid dielectric transformers: [h]aving a power handling capacity not exceeding 650 kVA." However, the merchandise was liquidated under subheading 8543.90.80, HTSUSA, which provides for: "[e]lectrical machines and apparatus, having individual functions, not specified or included elsewhere in this chapter; parts thereof: [p]arts:

Webster's Third New International Dictionary, Merriam- Webster Inc., Springfield, Mass., 1986, defines the following terms:

Transformer: A device employing the principle of mutual induction to convert variations of current in a primary circuit into variations of voltage and current in a secondary circuit and typically consisting of two separate coils usually with different numbers of turns wound on the same closed laminated iron core.

Capacitor: A device giving large capacitance or desired values of capacitance usually consisting of conducting plates or foils separated by thin layers of dielectric (as air, paraffin paper, or mica), the plates on opposite sides of the dielectric layers being oppositely charged by a source of voltage and the electrical energy of the charged system being stored in the polarized dielectric with the capacitance proportional to the area and dielectric constant of the dielectric layer and inversely proportional to its thickness - called also condenser.

Capacitance: The property of an electric nonconductor that permits the storage of energy as a result of electric displacement when opposite surfaces of the nonconductor are maintained at a difference of potential (as in a capacitor), its measure being the ratio of the charge on either surface to the potential difference between the surfaces and its value for a capacitor being the sum of the combined values of its several dielectric plates - called also capacity.

The protestant claims that the capacitor voltage transformer is classifiable as a transformer under the HTSUSA. It is argued that for GRI 3(b) purposes, the essential character of the merchandise is the transformer unit, not the capacitor voltage divider. We agree with this analysis. GRI 3(b) provides:

Mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, which cannot be classified by reference to 3(a), shall be classified as if they consisted of the material or component which gives them their essential character, insofar as this criterion is applicable.

We agree with the argument that the essential character of the merchandise is the transformer unit. In fact, the merchandise is called a capacitor voltage transformer. Also, as the protestant points out, the term "dielectric" is included in subheading 8504.21.00, HTSUSA. It is our position that, because of the inclusion of that term in the subheading, the tariff schedule anticipates the incorporation of the capacitor function with the transformer unit.

We have been advised by our technical staff that the article is an instrument transformer. According to the staff, an instrument transformer is one that is "used to sense voltage or current in both electronic circuits and power systems. There are two types, potential transformers and current transformers." The staff further stated that "[t]he fact that this particular transformer has a voltage divider which is a resistor connected across a voltage source in order to obtain a fraction of the total voltage does not mitigate the fact that it is a type of transformer. Its only purpose is to reduce the voltage to a level where it can be handled by the magnetic unit to the appropriate secondary voltage(s)."

In understanding the language of heading 8504, HTSUSA, the Explanatory Notes may be utilized. The Explanatory Notes, although not dispositive, are to be used to determine the proper interpretation of the HTSUSA. 54 Fed. Reg. 35127, 35128 (August 23, 1989). Explanatory Note 85.04(I) (p.1338) provides that:

Certain transformers are designed for particular purposes, e.g., matching transformers for matching impedance of one circuit with that of another, and instrument transformers (current or voltage transformers, combined instrument transformers) used to step down or step up voltages or currents to the level of the connected equipment, e.g., measuring instruments, electricity meters or protective relays.

As both the laboratory report and the Explanatory Note point out, the subject capacitor voltage transformer is an instrument transformer for classification purposes. It is used to regulate and reduce the amount of voltage from the primary voltage to the secondary voltage.

You claim that the merchandise is classifiable as a part under subheading 8543.90.80, HTSUSA. However, it is stated in Note 2(a) to Section XVI that "[p]arts which are goods included in any of the headings of chapters 84 and 85 (other than headings 8485 and 8548) are in all cases to be classified in their respective headings." It has also been claimed that the merchandise is classifiable under subheading 9030.90.80, HTSUSA, which provides for: "[o]ther instruments and apparatus for measuring or checking electrical quantities; parts thereof: [p]arts and accessories: [o]ther." Again, as applies to heading 8543, HTSUSA, Note 2(a) to Chapter 90 states that "[p]arts and accessories which are goods included in any of the headings of this chapter or of chapter 84, 85 or 91 (other than heading 8485, 8548 or 9033) are in all cases to be classified in their respective headings." It is our position that if the merchandise is considered to be a part, then under the above cited notes, it is classifiable in its respective heading, which is heading 8504, HTSUSA.


The subject capacitor voltage transformers are classifiable under subheading 8504.21.00, HTSUSA, which provides for: "[l]iquid dielectric transformers: [h]aving a power handling capacity not exceeding 650 kVA." The protest should be granted. A copy of this decision should be attached to the Customs Form 19 and mailed to the protestant as part of the notice of action on the protest.


John Durant, Director
Commercial Rulings Division

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