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HQ 967413




NOVEMBER 19, 2004

CLA-2 RR:CR:GC 967413 JAS

CATEGORY: CLASSIFICATION

TARIFF NO.: 9013.20.0000

Fred A. Durand, President
Durand-Wayland, Inc.
P.O. Box 1404
Lagrange GA 30241-1404

RE: Produce Coding Laser; NY K85700 Affirmed

Dear Mr. Durand:

In NY K85700, which the Director, National Commodity Specialist Division, U.S. Customs and Border Protection (CBP), New York, issued to you on May 27, 2004, certain produce coding lasers were held to be classifiable as lasers, other than laser diodes, in subheading 9013.20.0000, Harmonized Tariff Schedule of the United States Annotated (HTSUSA). In addition, NY K85700 stated that subheading 9817.00.5000, HTSUSA, the duty-free provision for machinery, equipment and implements to be used for agricultural or horticultural purposes, did not apply in this case because the coding or other marking of produce was not an agricultural or horticultural pursuit as those terms are commonly understood.

In accordance with section 177.2(b)(2)(ii)(C), CBP Regulations (19 CFR 177.2(b)(2)(ii)(C)), we have had occasion to review NY K85700 as it relates to subheading 9817.00.5000. For reasons that follow, we find that the produce coding lasers at issue do not qualify for treatment under that provision.

FACTS:

The articles at issue are CO2 lasers, designated the 6-8757 Horizontal Produce Coding Laser and the 6-8413 Vertical Produce Coding Laser. Both are imported without material handling equipment. They are used by growers and packinghouses to imprint on fresh fruit and produce such identifying information as
product look-up codes, country of origin labeling, grower lot numbers, and other requested security information. The laser technology does not penetrate the surface or skin of the product and, thus, does not promote decay.

ISSUE:

Whether the lasers qualify for treatment under subheading 9817.00.5000, HTSUSA.

LAW AND ANALYSIS:

Under General Rule of Interpretation (GRI) 1, Harmonized Tariff Schedule of the United States (HTSUS), goods are to be classified according to the terms of the headings and any relative section or chapter notes and, provided the headings or notes do not require otherwise, according to GRIs 2 through 6.

In accordance with Chapter 98, U.S. Note 1, HTSUSA, articles which meet the description in subheading 9817.00.5000, are eligible for classification under that provision provided the conditions and requirements thereof and any applicable regulations are met. In your ruling request of April 20, 2004, you specifically inquired as to the applicability of subheading 9817.00.5000, noting that, in your opinion, the Produce Coding Lasers meet the three-part test for inclusion in that provision, i.e., they are not among the list of articles expressly excluded from subheading 9817.00.5000, they are machinery, equipment or implements used for agricultural or horticultural purposes and, there will be compliance with the actual use regulations found in sections 10.131 through and including 10.139, CBP Regulations.

It is the second element of the three-part test above which is at issue here, that is, whether the Produce Coding Lasers can be said to perform a legitimate agricultural or horticultural pursuit. We believe they do not. In The United States v. Norman G. Jensen, Inc., 64 CCPA 51, 550 F. 2d 662 (1977), the appellate court upheld a lower court decision which held that the harvesting of a timber crop on tree farms was an agricultural pursuit and, more specifically, that the “skidding” of logs, i.e., the use of tractors to transport felled timber from the cutting site to an exterior landing area where it could be trucked to the sawmill, was a part of that harvesting. The court relied on the common and commercial meaning of the term agriculture which it found to include the cultivation of the soil for food-products or any other useful or valuable growth of the field or garden; tillage, husbandry, also, by extension, farming, including any industry practiced by a cultivator of the soil in connection with such cultivation, as
forestry, fruit raising, breeding and rearing of animals useful to man, dairy[ing], market-gardening, etc. The Court noted such meaning to include “harvesting of crops” and the “production of plants” which includes trees. It is noteworthy that the Jensen Court did not limit the agricultural nature of harvesting a timber crop to the mere cutting of trees, but included the subsequent step of dragging or “skidding” the logs to a landing area for subsequent transport to the sawmill. The Court noted with approval witness testimony to the effect that the harvesting of a timber crop is an agricultural pursuit and remains so until [the crop] leaves the forest. Implicit in this holding was the need to clear the forest floor to permit reforestation by the planting of seedlings in furtherance of a clearly expressed Congressional intent to establish, renew and protect forest growth. In similar fashion, HQ 952995, dated March 10, 1993, continued Customs longstanding position in respect of similar merchandise by holding that evaporating equipment used on farms to produce maple syrup from the sap of the sugar maple tree was not used in an agricultural pursuit. The rationale of this decision was that while the extraction of maple sap was a legitimate agricultural endeavor, to repeatedly circulate the maple sap through evaporating pans in order to boil off excess water to produce maple syrup, converts an agricultural product, maple sap, into a commercial product, maple syrup.

Consistent with these and related cases, CBP has established and maintained a distinction between pursuits or activities which relate directly to the growth or production and harvesting of crops, to include trees, and those pursuits or activities which occur after the crop is harvested or prepared for market, the latter of which we consider non-agricultural or marketing pursuits. This distinction has been uniformly and consistently applied over an extended period of time. For example, under the facts in Jensen, machinery for processing the logs after they reach the landing area, or for loading them onto trucks for transport to the sawmill, would be considered engaged in post-agricultural pursuits.

Based on the above analysis, it is our opinion that the produce coding lasers at issue here, used by growers and packinghouses to imprint on fresh fruit and produce product look-up codes, country of origin labeling, grower lot numbers, and other requested security information perform a function that does not relate directly to the growth or production or harvesting of crops but, rather, to an activity that occurs after the agricultural pursuit is completed.

HOLDING:

Under the authority of GRI 1, the 6-8757 Horizontal Produce Coding Laser and the 6-8413 Vertical Produce Coding Laser are provided for in heading 9013. They are classifiable in subheading 9013.20.0000, HTSUSA. For the stated reasons, they do not qualify for duty-free treatment under subheading 9817.00.5000, HTSUSA.

NY K85700, dated May 27, 2004, is affirmed.

Sincerely,

Myles B. Harmon, Director
Commercial Rulings Division


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