CIT Rules Honda Oil Bolts are Classified Under 7318 and Not as Auto Parts
In Honda of America Mfg., Inc., v. U.S., the Court of International Trade ruled that certain oil bolts containing cross-sectional holes specially designed to permit the unimpeded flow of brake or transmission fluids are classified under HTS 7318.15.80 (as other screws and bolts) at a rate of duty of 8.5 percent ad valorem and not as a part or accessory of motor vehicle under 8708 or 8714.
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The CIT stated that the General Rules of Interpretation in HTS Chapter 87, Section XVII, Note 2(b) specifically states that parts and parts and accessories cannot be classified in Chapter 87, if they are parts of general use.
In addition, the CIT stated the Explanatory Notes to Section XV, General (C) states that parts imported separately which are of general use are not considered as parts of articles, but are classified in the headings that most appropriately describes them.
HTS heading 7318 covers screws, bolts and similar articles, of iron or steel. Honda agreed that its oil bolts met the definition of a screw, but it argued that the classification conclusions reached by Customs on three specific rulings support its position that these oil bolts should be classified as auto parts.
The CIT reviewed the three rulings, determining that in the first two rulings Customs had, in fact, classified the articles involved as parts and not parts of general use. The CIT noted that neither of the articles in the first two rulings met the general-use definition, thus Customs ruled that they were parts.
On the third ruling, the CIT noted that Customs' classification as vehicle parts in Chapter 87 was based on the brake cables having been cut to a specific length and thickness with special end terminations which dedicated them for use in certain vehicles.
The CIT also noted a number of additional classification decisions issued by Customs in which the bolts or screws, although specially designed to allow oil to flow through them, were not considered parts of vehicles.
The CIT ruled that the term screw defined the oil bolts at issue and also that prior rulings by Customs supported classification under 7318. Thus, the Court concluded that the oil bolts had been correctly classified under subheading 7318.15.80.
Slip Op. 09-51 (dated 06/05/09) available at http://www.cit.uscourts.gov/slip_op/Slip_op09/09-51.pdf