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HQ 958018

October 6, 1995

CLA-2 R:C:M 958018 LTO


TARIFF NO.: 8415.82.00; 8415.90.80

Mr. William H. Steere
United Technologies Carrier
Carrier Parkway
P.O. Box 4800
Syracuse, New York 13221

RE: Vertical packaged air conditioning units; GRI 2(a); section XVI, note 2,4; unfinished; functional unit; HQ 087077; HQ 957130 modified

Dear Mr. Steere:

This is in response to your letter of April 19, 1995, to the Customs office in New York, requesting the classification of a Carrier 50 BR BZ vertical packaged air conditioning unit under the Harmonized Tariff Schedule of the United States (HTSUS). Your letter was referred to this office for a response. Pursuant to section 625(c)(1), Tariff Act of 1930 (19 U.S.C. 1625(c)(1)), as amended by section 623 of Title VI (Customs Modernization) of the North American Free Trade Agreement Implementation Act, Pub. L. No. 103-182, 107 Stat. 2057, 2186 (1993), notice of the proposed modification of HQ 957130, issued to you on November 9, 1994, was published on August 30, 1995, in the Customs Bulletin, Volume 29, Number 35.


The vertical packaged air conditioning unit consists of an evaporator fan coil, connecting tubing and compressor. The unit connects to an outdoor air- or water-cooled condenser unit. The indoor unit comprises approximately 70-80 percent of the value of the complete, "split-system" air conditioner, but cannot function without the outdoor unit. The 5 to 15 ton units are used in office buildings, light industrial, restaurant or retail applications. Different control systems are offered. - 2 -


Whether the vertical packaged air conditioning unit, an indoor unit for a split-system air conditioner, is classifiable as a part of an air-conditioning machine under subheading 8415.90.80, HTSUS.


The General Rules of Interpretation (GRI's) to the HTSUS govern the classification of goods in the tariff schedule. GRI 1 states, in pertinent part, that "for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes . . . ."

Note 4 to section XVI, HTSUS, concerns the classification of "functional units" under the tariff schedule. The note provides, in pertinent part, that "[w]here a machine (including a combination of machines) consists of individual components . . . intended to contribute together to a clearly defined function covered by one of the headings in chapter 84 or chapter 85, then the whole falls to be classified in the heading appropriate to that function."

Split-system air conditioners consist of two units that, when imported together, contribute together to a clearly defined function described by heading 8415, HTSUS, which provides for air-conditioning machines, comprising a motor-driven fan and elements for changing the temperature and humidity. Accordingly, split-system air conditioners, which incorporate refrigerating units, are classifiable under subheading 8415.82.00, HTSUS, while those that do not incorporate refrigerating units are classifiable under subheading 8415.83.00, HTSUS

The vertical packaged air conditioning unit, when imported separately, is not described by the terms of heading 8415, HTSUS, as it, by itself, is not capable of "changing the temperature and humidity." Moreover, because complete split-system air conditioners are classifiable as "functional units," neither the indoor, vertical packaged air conditioning unit, nor the outdoor condenser unit, can be classified according to GRI 2(a) as an "unfinished" air-conditioning machine. See HQ 087077, dated March 27, 1991 (wherein we stated that there are no HTSUS legal notes or ENs that provide for "unfinished" functional units). Finally, as the vertical packaged air conditioning unit is not a "good included" in any chapter 84 or 85 heading, it is classifiable as a part of an air-conditioning machine under subheading 8415.90.80, HTSUS. See Section XVI, note 2(a)(b), HTSUS.

In HQ 957130, we considered the classification of air conditioners for buses, imported in various configurations. One of the configurations concerned the - 3 -
importation of self-contained evaporator and condenser units for these air conditioners. These units were classified according to note 4 to section XVI, HTSUS, under subheading 8415.83.00, HTSUS. The evaporator and condenser units are components of a system that is designed to include a compressor, and cannot function without it. As stated above, because complete split-system air conditioners, such as the bus air conditioning system, are classifiable as "functional units," the evaporator and condenser unit, which do not form a complete air conditioning machine, cannot be classified according to GRI 2(a) as an "unfinished" air conditioning machine. Accordingly, both are classifiable, as parts, under subheading 8415.90.80, HTSUS.


The vertical packaged air conditioning unit is classifiable under subheading 8415.90.80, HTSUS, which provides for parts of air-conditioning machines. The corresponding rate of duty for articles of this subheading is 2% ad valorem.

In accordance with 19 U.S.C. 1625(c)(1), this ruling will become effective 60 days after publication in the Customs Bulletin. Publication of rulings or decisions pursuant to 19 U.S.C. 1625(c)(1) does not constitute a change of practice or position in accordance with section 177.10(c)(1), Customs Regulations (19 CFR 177.10(c)(1)).

John Durant, Director

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