In ruling N307400, Customs and Border Protection (CBP) discussed the classification of the iHarvest Hydroponic System (iHarvest). The iHarvest is used to grow fruits and vegetables indoors. It incorporates plastic molds which are assembled to create the hydroponic system shell, pumps and hoses for irrigation, net cups to hold plants in place, LED lights and stands, as well as timers for the irrigation and lighting system. The unit contains five 6-Pot Units. The item measures approximately 60” (H) x 32” (W) x 14” (D). The components are all packaged together for retail sale.
CBP determined that the applicable subheading for the item is 8424.82.0090, HTSUS, which provides for “Mechanical appliances (whether or not hand operated) for projecting, dispersing or spraying liquids or powders; fire extinguishers, whether or not charged; spray guns and similar appliances; steam or sand blasting machines and similar jet projecting machines; parts thereof: Other appliances: Agricultural or horticultural: Other.” The rate of duty is 2.4% ad valorem.
Pursuant to U.S. Note 20 to Subchapter III, Chapter 99, HTSUS, products of China classified under subheading 8424.82.0090, HTSUS, unless specifically excluded, are subject to the List 2 additional 25% ad valorem rate of duty. At the time of importation, 9903.88.02, in addition to subheading 8424.82.0090, HTSUS, must be reported.
CBP also discussed whether the subject merchandise would be considered for duty-free treatment as agricultural or horticultural machinery under subheading 9817.00.50, HTSUS, which provides for Machinery, equipment and implements to be used for agricultural or horticultural purposes. To fall within a special classification, a three-part test must be met.
First, the subject merchandise must not be excluded from the heading under Section XXII, Chapter 98, Subchapter XVII, U.S. Note 2, HTSUS. The subject merchandise is classifiable under the subheading 8424, HTSUS, and this subheading is not excluded from 9817. Second, the terms of the headings must be met in accordance with GRI 1, which provides that classification is determined according to the terms of the headings and any relative section or chapter notes. Third, the article must comply with the actual use regulations under 19 CFR 10.131 through 10.139. Subheading 9817.00.50, HTSUS, as required by GRI 1, states the unit must be “machinery”, “equipment” or “implements” used for “agricultural or horticultural purposes”.
It was CBP’s opinion that the subject merchandise is “equipment” which fulfills the requirement of a horticultural pursuit. Therefore, the iHarvest Hydroponic System is classifiable under subheading 9817.00.50, HTSUS, if the actual use conditions and requirements of Sections 10.131 through and including 10.139, Customs Regulations, are met.
Additional duties imposed by headings 9903.88.01, 9903.88.02, 9903.88.03 and 9903.88.04 do not apply to goods for which entry is properly claimed under a provision of chapter 98 HTSUS, except for goods entered under headings 9802.00.40, 9802.00.50, 9802.00.60, and 9802.00.80.