CIT Rules for Industrial Shredder Importer in Classification Case
The Court of International Trade ruled Dec. 11 that imported industrial shredders that use blades to break up material carry no duties because they are classifiable as crushing and grinding machines.
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The case involved a dispute over whether the large blades of importer Vecoplan's recycling machines barred them from classification as machines whose purpose is “crushing, grinding, or screening,” covered by the duty-free subheading 8479.82 of the Harmonized Tariff Schedule. CBP instead liquidated the products under subheading 8479.89 for “other” machines, carrying a 2.5% duty.
Vecoplan, an importer of German industrial shredders that cut down and compress material to be recycled, sought summary judgment Nov. 14 in a proceeding designated as a test case for several of the company’s other classification challenges (see 2211150036).
DOJ argued Vecoplan’s machines primarily “shred and cut” (see 2301260039). It said “crushing” and “grinding” both require affected materials be reduced to particles.
Presiding Judge Richard Eaton likened the machines to coffee or meat grinders. He called CBP’s classification of them "more inventive than legal,” concluding that the machines both crush and grind, making them classifiable in subheading 8479.82.
“Crushing” has a two-part definition, the judge said. First, a material is pressed very hard. Second, that material is broken apart or destroyed. This happens twice within Vecoplan’s machines, he said, because the materials that go through the machine are pressed against spinning, then stationary, blades.
One definition of "grinding," he said, is to “chop into small pieces or fine particles by means of sharp metal blades.” This occurs in Vecoplan’s machines simultaneous with the crushing, he said, likening the machines to a coffee grinder.
Eaton disagreed with CBP’s analysis, calling it surprising. He said CBP inverted the proper classification method when it made its determination that Vecoplan’s products fell under the residual “other” subheading.
In classifying a product, he said, CBP should first look to the rules of tariff classification, then decide whether or not a product fits in a particular category.
“Customs would have the court find that GRI 6 should be applied in the following way,” he said. “First, determine the function of the machines as being “cutting or shredding” and nothing more; then, search terms of the subheadings under heading 8479 for those words, and those words only; and hold that since those words are not found in any subheading, the machines must necessarily be classified under the basket category.”
(Vecoplan, LLC v. United States, Slip Op. 23-173, CIT # 20-00126, dated 12/11/23; Judge: Richard Eaton; Attorneys: Lawrence Friedman of Barnes, Richardson for plaintiff Vecoplan; Monica Triana for defendant U.S. government)